Whether you are a sole trader, a director or a shareholder with voting rights it is important to consider who would deal with your business affairs, should you become incapacitated or unable to do so.
When dealing with the everyday aspects of your business, the last thing you want to be thinking about is what could happen if you became unable to carry out those tasks and run your business effectively.
A business Lasting Power of Attorney is a form of insurance which provides an appointed person (your Attorney) with the authority to keep your business running, sign contracts, buy and sell property and access your bank accounts.
If you were a sole trader and become incapacitated and did not have an attorney appointed, it would not be possible for family members to enter business contracts or access business bank accounts etc. without a valid power of attorney. This can often have a detrimental effect on businesses and can lead to the inability to order stock or pay suppliers which could lead to the winding of up your business.
LPAs are easy to put in place and have a positive effect on the continuity of your business. LPAs only come into force once needed and are not just limited to the loss of mental capacity; they can also be used during temporary periods when you have capacity e.g. holidays or during a period of injury or sickness.
Planning ahead allows you to choose who can act on your behalf, whether it is a business associate, partner or a family member. The key when appointing an Attorney to deal with you business property and affairs is to appoint someone individually or collectively that you not only trust but is familiar you’re your business and has the ability to stand in your shoes and carry out your role.
For more information regarding Business LPAs, please contact our Wills and Estate Planning team.