Business succession planning arrangements

For intermediaries only

Whether your client's business is a limited company or a partnership, the following interactive flowcharts will walk you through the steps you need to think about when setting up a shareholder or partnership protection arrangement.

Important information – please read

This information is based on our understanding of current taxation law and HM Revenue & Customs (HMRC) practice, which may change, and should not be interpreted as advice.

Aegon UK isn’t permitted to offer taxation and legal advice for regulatory reasons. We accept no responsibility for actions taken or refrained from on the basis of this information.

Trusts establish legal rights and entitlements and might have material financial and tax implications for the settlor, trustees and beneficiaries. Aegon UK isn’t authorised to provide legal advice, so you should take your own legal advice before setting up a trust, to make sure that it meets your clients’ requirements. Our trusts have been drafted for use by UK domiciled individuals.

I want to set up the arrangement for shareholders/limited company.


Do the Articles allow the shareholders to do what they want with their shares if a shareholder dies or becomes critically ill?

No, the Articles don't allow the shareholders to do what they want with their shares if a shareholder dies or becomes critically ill.


Outcome

The Articles can be amended by a solicitor, for example if it’s expressly stated that company buyback isn’t allowed or if they want to change any pre-emption rights.

Yes, the Articles allow the shareholders to do what they want with their shares if a shareholder dies or becomes critically ill.


Do the shareholders have pre-emption rights?

Pre-emption rights give the existing shareholders the rights to buy the shares before anyone else.

Shareholders have own life in business trust pre-emption rights.


Your result

Based on what you told us, we recommend you:

  1. Identify the shareholders.
  2. Establish the value of the company. If not known, refer to the company's accountant.
  3. Download and read our guidance document.

Shareholders have life of another pre-emption rights.


Your result

Based on what you told us, we recommend you:

  1. Identify the shareholders.
  2. Establish the value of the company. If not known, refer to the company's accountant.
  3. Download and read our guidance document.

Shareholders don't have pre-emption rights.


Your result

Based on what you told us, we recommend you:

  1. Identify the shareholders.
  2. Establish the value of the company. If not known, refer to the company's accountant.
  3. Download and read our guidance document.

I want to set up the arrangement for partners/partnership.


Is there a partnership agreement in place?

No, there's no partnership agreement in place.

Outcome

If there's no partnership agreement in place, the Partnership Act 1890 applies. The partnership is automatically dissolved on the death of a partner, with the deceased’s partnership interest passing to their estate.

A partnership agreement can be set up at any time if the partners want a different outcome. A solicitor will be able to advise on this.

Yes, there's a partnership agreement in place.


Does the agreement cater for what each of the partners want to happen to their interests in the event of a death or critical illness of a partner?

No, the agreement doesn't cater for what each of the partners want to happen to their interest in the event they die or become critically ill.


Outcome

The agreement can be amended by a solicitor.

Yes, the agreement caters for what each of the partners want to happen to their interest in the event of a death or critical illness of a partner?


Your result

Based on what you told us, we recommend you:

  1. Identify the partners.
  2. Establish the value of the partnership. If not known, refer to the partnership accountant.
  3. Pick one of the options below.