Why Business Owners Need a Lasting Power of Attorney:
Why should business owners make a Lasting Power of Attorney? It’s a good question with a very simple answer: to protect their business.
How would your business – and the people working for you – manage if you became mentally incapacitated? Lasting Powers of Attorney (LPAs) allow nominated people to help you should you be unable to deal with financial matters. They are becoming more common as business owners are staring to realise their importance, although they are not yet common enough.
You have to make an LPA while you are well. It acts as another type of insurance for your business. A sudden accident or illness could make business decisions impossible. In the UK, on average, one person is diagnosed as being mentally incapacitated every three minutes. What if you were that person?”
Business (or Commercial) LPAs – Why now?
Hopefully you won’t need an LPA for years – so why set one up now?
- An LPA covering your business is not a ‘nice to have’ – essentially, it’s as vital to your business as having insurance!
- You could have an accident or stroke at any time that might leave you without mental capacity.
- Insure against one of the ‘what ifs’ that none of us like to think about – what if something happens to you and you are no longer well enough to access company money to pay bills, suppliers, employees or sub-contractors?
- Even if the business could continue to run in your absence, that couldn’t happen without access to company money. As soon as someone loses mental capacity all their accounts are frozen. It takes a long, expensive court process before someone is appointed to act on behalf of the person who is ill.
- Business owners often need two LPAs. One for personal finance and one for business, as it may be that you would like different people to be appointed for each aspect. This is particularly likely if you are in business with anyone other than your spouse.
The choice is simple – create an LPA to cover you and your business, or risk losing your business and it costing thousands of pounds in court fees if you suddenly become mentally unwell. The alternative court action can take many months by which time your business may well have had to close.
For your families and work colleagues an LPA gives peace of mind that should anything happen to you, everything is taken care of – and at a worrying time, it would be one less problem for them to have to deal with.
It’s a really easy process too – it will take about 45 minutes of your time to get that valuable protection in place, and it will cost £175 for each document you need (and it is a legitimate business expense for tax purposes).
Call A.R.K. now on 01438 746977 / 07926 339934 if you have any questions, or to make an appointment for one of our advisors to visit you.
Alternatively, please fill out the form below to find out how we can help: