Many business owners often focus on growth and achieving the day-to-day operational demands of their business, failing to recognise the importance of what happens when they are no longer there to lead it. Business succession planning involves identifying successors and preparing for the transfer of leadership and ownership of your business when you retire or cannot continue management.

According to the National Association of Corporate Directors, less than one in four private business owners have a formal succession plan in place. Following recent changes to inheritance tax for businesses in the Autumn Budget 2024, it is a good time to start planning for the long-term survival of your business. A strategic succession plan not only helps to ensure continuity of your company, but will also drive growth, reduce tax and facilitate your retirement.

Wills

Putting a Will in place is the simplest, yet arguably the most important, method of succession planning allowing you legally define the succession of your business. Through a carefully drafted Will, you can specify how you want your assets, including your business, to be distributed on your death. You can choose entrusted executors in your Will who will be responsible for managing and distributing your business assets according to your wishes. You can also include a trust in your Will that will protect your business if you have beneficiaries who are minor and cannot manage finances themselves.

Lasting Powers of Attorney (LPA)

An LPA is another important consideration for business owners which allows you to appoint a trusted individual to manage your financial and business affairs should you lack capacity or are physically unable to do so.

The consequences for you and your business when you do not have a properly executed LPA in place are wide-ranging, particularly for sole business owners. Without an LPA, a costly court application will be required to appoint a Deputy to act on your behalf, who may not understand or carry out your wishes. While partnership agreements may address lack of capacity, an LPA offers a more comprehensive solution by managing all your personal financial matters and providing greater legal protection.

Tax Planning

Recent changes in the Autumn Budget 2024 have capped Business Relief against inheritance tax up to the value of £1million, with any value exceeding such cap being taxed at the rate of 20%. Lifetime gifts and charitable contributions that are appropriately timed and structured can lock in the favourable Business Relief regime and enable transfer of your business to be managed in the most tax efficient way.

Overall, a strategic, long-term approach to business succession planning should be an integral part of your business strategy and operation. Planning ahead will safeguard long-term success of your business and protect your business assets. By seeking further legal advice from our team, we can help you with all aspects of succession planning for your business when it comes to making a Will and Lasting Power of Attorney.

For further advice and assistance please contact our Wills, Trusts and Probate team on 01604 828282 / 01908 660966 or email info@franklins-sols.co.uk

Lasting Powers of Attorney (LPA) allow you to appoint attorneys, people you trust implicitly, to deal with your financial affairs and health and welfare affairs during your lifetime.

The Office of the Public Guardian expect to register 1 million LPA’s in 2023.

Is it easier to prepare them myself?

Making LPA’s can be a cumbersome process due to the amount of paperwork involved. If a mistake is made within the LPA and this has then be submitted to the Office of the Public Guardian, there is a risk that the LPA will not be registered. This can have a detrimental impact on the donor if anything happened to the donor prior to the LPA being registered for example, if they had since lost capacity. In this situation, the donor would be treated as not having LPA’s in place and there loved ones would need to make an application to the Court of Protection to apply to become deputies instead. This is a lengthy and time consuming process.  

How are they safeguarded?

When making LPA’s it is extremely important that you trust your attorneys implicitly. At the moment the Office of the Public Guardian do not have any powers to investigate those making an application for the LPA’s and to stop registration if they have any concerns. They are reliant on third parties to raise concerns. The Office of the Public Guardian have confirmed that it is quite common for certificate providers to sign the LPA’s and then raise concerns with the Office of the Public Guardian when the LPA’s have then been sent of for registration. Often Certificate Providers are friends or neighbours who would not feel comfortable raising their concerns with the donor themselves.

In the case of Public Guardian v RI [2022] EWCOP 22 (07 June 2022) the Court of Protection determined that the donor did not have sufficient capacity when he made his Lasting Powers of Attorney 12 years ago and, therefore, the Office of the Public Guardian were ordered to cancel them.

This case highlights the importance of ensuring that where a donor may lack the capacity to prepare a Lasting Power of Attorney extra precautions are taken. In order to execute a Power of Attorney, a ‘Certificate Provider’ will need to sign the LPA to confirm that they are happy that the donor has the necessary capacity to make the LPA. The Certificate Provider can be someone who has known you for at least 2 years however, it is advised, especially where capacity is a concern, that this Certificate Provider is a solicitor or a medical professional. In this case, the Certificate Provider could not be traced and, therefore, this meant that the capacity of the donor at the time could not be determined.

It is important that you are fully advised on the implications of putting in place LPA’s and the necessary steps are taken to ensure you have capacity and mitigate any challenges a relative may wish to make against the validity of your Lasting Power of Attorney. Whilst LPA’s can be prepared by the donor, if it was ever questioned in the future it would be a challenge to demonstrate the donor did in fact have the required capacity at the time the LPA was prepared and signed.

For further advice and assistance please contact our Wills, Trusts and Probate team on 01604 828282 / 01908 660966 or email info@franklins-sols.co.uk

 

 

Photo by Alex Green from Pexels

Have you ever considered what would happen if you were in an accident or if you were diagnosed with a condition which meant that you could no longer make decisions for yourself?

If only we could see what the future holds? Maybe we would then be in a better position to plan for what is to come. No one has the answer but this doesn’t mean that you can’t plan ahead for some eventualities.

It is a common misconception that your spouse or civil partner would automatically be in a position to deal with matters for you. Some also think that their ‘next of kin’, perhaps a child, parent or sibling, would be able to help instead. Unfortunately, they too do not have the legal right to deal with matters on your behalf.

This leaves many people in a vulnerable position. Family members, may find themselves in the position that they are unable to access information regarding your assets, even in order to keep paying your bills or dealing with your day to day care.

So, what can you do to prepare for your future?

Lasting Powers of Attorney – what are they?

A Lasting Power of Attorney allows one or more people you Trust implicitly – called “Attorneys” – to make decisions on your behalf, known as the “donor”. There are two types of Lasting Powers of Attorney:

Both Lasting Powers of Attorney are a legally binding document recognised by financial institutions, such as banks, plus government bodies which allow you to appoint individuals closest to you to assist you during your lifetime. Guidance and conditions can also be included to ensure that you are protected whilst also providing your appointed Attorneys with some guidance, which will help them to make decisions in the future.

Lasting Powers of Attorney must be registered with the Office of the Public Guardian before it can be used. In the case of Property and Financial Affairs Lasting Power of Attorney, these can be used prior to the donor losing capacity, if the donor wishes at the time of the Lasting Power of Attorney being created.

A Lasting Power of Attorney can therefore best be described as an insurance policy and while it’s hoped it will never need to be used, it’s there just in case.

What if it’s too late and your loved one has already lost capacity without putting a Lasting Power of Attorney in place? – Deputyship

If you don’t have a Lasting Power of Attorney and you lose the ability to manage your own affairs, the alternative is Deputyship. This is a slow and expensive process (usually around 6 – 12 months), involving an application to the Court of Protection.

This therefore makes it extremely difficult for the person looking after you, as they won’t have legal authority to help you until after the authority is granted.

Health and welfare deputyships are uncommonly granted by the Court of Protection and are usually seen as a last resort. Instead, an order may be made to assist with a specific issue rather than delegating full decision-making power. This is because the Court prefers to retain powers in this respect given the sensitive and often complex nature of the decisions to be made.

If you’d like more information about Lasting Powers of Attorney contact our expert Private Client Team on 01908 660966 / 01604 828282 or email PrivateClient@franklins-sols.co.uk.

Kate Garraway’s heart-breaking story of her husband Derek’s year-long battle with Covid has been made even more complicated by the lack of legal protection she and Derek had in place. Kate was unable to access funds to manage her husband’s care or refinance her mortgage. She didn’t even have the legal right to see his medical notes, owing to data protection. 

Research by SFE, shows that 65% of us think our next-of-kin will make medical and care decisions for us if we are no longer able to. In reality, this isn’t the case unless a Health & Welfare Lasting Power of Attorney is in place. Whilst there has been a rise in the number of enquiries made about Lasting Power of Attorneys (LPAs) during the pandemic, only 22% of people in the UK actually have one. 

What is a LPA?

There are two types of Lasting Power of Attorney;

They are legally binding documents, registered by the Office of the Public Guardian, used to protect your interests by nominating people you Trust to act on your behalf, should you become unable to make important decisions about your own welfare or financial decisions.

What if I lose capacity and I don’t have LPAs in place?

Your loved ones would need to begin a lengthy and costly application to the Court of Protection to apply for Deputyship over your finances. The Court of Protection must be satisfied that the appointed Deputy is in the individual’s best interests. When it comes to health and welfare matters it’s often much more difficult for a Deputy to be appointed. That said, there are certain scenarios where the Court of Protection require cases to be brought before them for a decision to be made.

Deputyship also imposes additional duties on the Deputy in terms of filing accounts and supervision from the Court of Protection.

How to avoid an application for Deputyship

To avoid this difficult kind of legal situation it’s important to utilise the expertise of a specialist lawyer to assist in putting in place Lasting Powers of Attorney and support those making these crucial, complex and difficult decisions. According to Which? 22,000 LPAs are rejected every year so it’s essential that you get your legal documents right.  

At Franklins, our expert Private Client team provide clear, practical advice in future planning. For further information Lasting Powers of Attorney, contact the team on 01908 660966 / 01604 828282 or email PrivateClient@franklins-sols.co.uk.

A recent article prepared by my colleague Ellen Stiles highlighted the importance of preparing a Lasting Power of Attorney, especially in light of the current pandemic where they have been invaluable, not only for the vulnerable and elderly, but to a much wider group of people from all sections of society, who have required assistance through lockdown.

Following on from this article, the Office of the Public Guardian (the OPG) have recently unveiled an online platform which now allows an Attorney to create an account whereby they can upload a copy of the registered Lasting Power of Attorney. The Attorney can then get an access code that they can provide to the relevant organisations to prove their authority to act. Prior to this platform, paper copies of the Lasting Power of Attorney needed to be provided, which could then take several weeks to process causing delays for the Attorney(s) who needs the authority on the relevant account to act.

It is important to note that the online forum is only being rolled out for Lasting Powers of Attorney registered from 17th July 2020, although the OPG are looking at extending it to Lasting Powers of Attorney registered before this date.

We do however advise that, although the online service may make the process more convenient for Attorneys and has received good feedback according to the OPG, caution must to be still be taken as, with any online platform, it could be open to abuse and safeguarding the Donor (the person making the Lasting Power of Attorney) must remain paramount.

For more information on Lasting Powers of Attorney, contact our friendly Private Client team today on 01908 660966 / 01604 828282 or email PrivateClient@franklins-sols.co.uk.

During the current Coronavirus outbreak, and with the lockdown in place, you will find a Lasting Power of Attorney invaluable.

A Lasting Power of Attorney (LPA) is a legally binding document whereby you can appoint someone, known as your Attorney, to make decisions and act for you when you are unable to do so for yourself. You must have the necessary mental capacity in order to make an LPA.

Whilst an LPA is most commonly used to support elderly and vulnerable people, it is now even more useful to a much wider group of people from all sections of society. Even the Prime Minister was affected by the Coronavirus, and if he had been incapacitated, his family would have needed an LPA to make personal decisions on his behalf. An LPA is beneficial to more of us now than ever before.

There are two type of LPAs which can be created, these are:

  1. Property and Financial Affairs – covering decisions such as buying and selling property, investing money and managing investments, receiving income and paying liabilities.
  2. Health and Welfare – covering decisions such as medical care you receive, where you live, who visits you, day to day care such as social activities, and what you eat. It also covers decisions in relation to life sustaining treatment.

With the current restrictions in place due to the pandemic, in particular for the vulnerable and elderly (but not limited to them), having an Attorney appointed to assist you with your affairs has never been so helpful. Subject to your preferences, an Attorney under a property and financial affairs LPA can assist you whilst you still have the necessary capacity yourself. However in these circumstances, any decisions made should be made with your consent. If in the unfortunate situation you were to lose the necessary mental capacity to make decisions in relation to your property and financial affairs, you can be reassured that your Attorney can continue to act on your behalf.

An attorney under a health and welfare LPA cannot act until you are unable to make the decision in question due to lack of mental capacity. This can include incapacity due to being in a coma, illnesses and disorders as well as Alzheimer’s and dementia.  During these unprecedented times many people are finding themselves in critical conditions whereby they are unable to make decisions for themselves. By having a health and welfare Attorney appointed you can be reassured that they can safeguard your preferences and wishes during these crucial times.

It is understandably vital that you appoint the correct Attorney. You can technically appoint as many Attorneys as you wish though commonly between 1 and 4 are appointed. You must not only ensure that you Trust your Attorney implicitly but that they are capable of taking on the role. Your Attorney must also agree to being your Attorney. Attorneys cannot simply do whatever they wish and are subjected to the rules that govern Lasting Power of Attorneys as well as any restrictions you choose to place upon them.

An LPA is a legal deed and it is therefore important that legal advice and assistance is obtained when you are considering preparing one. Nearly 22,000 LPAs have rejected by the Office of the Public Guardian over the past 12 months and sadly for some of these it may be too late for a further LPA to be prepared due to mental capacity having been lost.

The Government have now issued guidance in relation to the preparation and registration of an LPA during the Coronavirus outbreak. An LPA needs to be signed by all parties, including the appointed attorneys and each signature needs to be witnessed by an independent person. A certificate provider, whose role is to confirm that you understand what the LPA is and that no pressure has been placed upon you to make it, also needs to sign the LPA. It is possible for all parties to sign the LPA and still adhere to the current social distancing rules and we are guiding clients through this process.

A Lasting Power of Attorney can provide you, in these uncertain times, a sense of certainty and is more beneficial to use than ever before.

For more information on Lasting Powers of Attorney, contact our friendly Private Client team today on 01908 660966 / 01604 828282 or email PrivateClient@franklins-sols.co.uk.

In light of current circumstances with COVID-19, the Law Society and Ministry of Justice are currently reviewing the requirements around witnessing wills, in an effort to make is easier for individuals to sign their wills during these uncertain times.

Current legislation provides that your Will must be signed by the testator (the person making the Will) in the presence of two independent witnesses. With the current lockdown, self-distancing and self-isolating provisions it is becoming increasingly difficult to meet such requirements.

Whilst matters are currently up in the air, here at Franklins Solicitors LLP we are trying other methods to meet our clients’ needs, not only with signing their Wills but also when taking instructions.

Initial instructions

Firstly, we are providing our clients with the firms Will Questionnaire by email and requesting that they complete the same so that we have as much information as possible to fully understand their requirements, potential issues and wishes.

Instead of bringing this to our usual face to face meetings, we are currently offering telephone appointments, Skype calls, Zoom and, in some circumstances, even Facetime.

Execution

Various methods for signing your Wills are currently being offered:

  1. The Will can be posted out to the client for signing remotely. Before the Will is posted, a discussion of the Will clause by clause will be provided, together with a discussion as to how the Will needs to be signed and measures to be taken during this period of self-distancing and self-isolation. A briefing note will also accompany the bound Will for ease of reference.
  1. A home visit can be arranged. This is usually offered to our clients but, in current circumstances, we are adapting the way in which such visit is conducted. Firstly, the Will is be bound and placed in an envelope well in advance of the meeting. Using disposable gloves, the Will is then removed from the envelope and placed on the doorstep, or even passed through a window, for the client. Maintaining a safe distance, the testator can sign the Will in the comfort of their own home whilst our staff witness. The will can then be passed back through the window/placed on the doorstep so that the testator can step back keeping a safe distance while the Will is then witnessed in their presence. We are strongly advising client to use their own pens and to wash their hands thoroughly. 

We understand that this is a worrying time for many individuals and wish to continue assisting our clients with the preparation of their Wills as far as possible. If you would like to get in touch with a member of the team to make/review your Wills, please contact the office on 01908 660966 / 01604 828282 or by emailed at wills@franklins-sols.co.uk. 

LPAs and Will WritingSeptember is Alzheimer’s month and provides an opportunity for organisations and individuals to raise awareness of the disease and to do all that we can to support those living with it.

Here at Franklins Solicitors LLP, 71 members of staff have become Dementia Friends by completing some voluntary training to understand how to recognise that a client may be struggling and how to assist those individuals to come to a solution.

Dementia refers to a variety of illnesses and conditions which result in an impairment of brain function and a decline in intellectual functioning. In light of the below statistics published by the Alzheimer’s Society, we constantly advise clients who attend our offices to ensure that their affairs are in order well in advance to assist them, and their loved ones.

Statistics:

Advice:

Although we advise clients to prepare for the future, should you be diagnosed with dementia, this does not automatically mean that you are unable to take any further action. Provided that you still have the necessary capacity to make a Will or Lasting Powers of Attorney, a diagnosis does not prevent you planning for your future, it may just slightly complicate matters and this is where specialist advice is important.

Here at Franklins Solicitors LLP we are dedicated to assist where we can. If you would like to obtain advice or guidance regarding the preparation of a Will, Lasting Powers of Attorney or would like assistance with a Deputyship Application, please contact our Private Client team on privateclient@franklins-sols.co.uk or call our Northampton office on 01604 828282 / Milton Keynes: 01908 660966.