I’ve inherited a business!

[chlodah]

Very recently someone I cared for sadly passed away. They left me their business which was a really successful and well established retail outlet. He operated as a sole trader so in effect his business went with him. I’d like to carry it on in his honour but don’t know where to start! The solicitor is doing the probate thing which will take up to 18 months, I’m running the business now but can’t take a wage - which is fine in the short term as I’m employed elsewhere. I haven’t got a clue where to start is anyone able to advise where I can go for advice? I don’t mind paying for it. His accountant said the solicitor would advise but he just deals with probate. I spoke to a commercial expert and he said about registering as a limited company? But I’d rather just carry on as a sole trader I think. Any advice or direction appreciated. Thank you

 

[Joyous]

But an expert has already given you what seems like pretty good advice and you're choosing to disregard it?

 

[Deleted member 362062]

I'm sorry for your loss. This is a complex situation that requires careful consideration of legal, financial, and practical aspects.



Here's some guidance to help you navigate this process:



1. Immediate steps:

- Continue operating the business as you are, but keep meticulous records of all income and expenses.

- Open a separate bank account for the business to keep its finances separate from personal accounts.

- Inform HMRC about the change in ownership and your intention to continue the business.



2. Legal considerations:

- While probate is ongoing, you're technically operating the business on behalf of the estate. The executor should provide written permission for you to do this.

- Once probate is complete, you can formally take ownership and decide on the business structure.



3. Business structure options:

- Sole trader: This is the simplest option and allows you to continue the business much as it was. You'll need to register as self-employed with HMRC.

- Limited company: This provides more protection for personal assets but involves more administrative work and different tax implications.



4. Financial considerations:

- Review the business's financial position, including any debts or liabilities you might be inheriting.

- Consider seeking professional valuation of the business assets.

- Plan for any potential inheritance tax liabilities.



5. Operational aspects:

- Review and transfer or renew any licenses, permits, or contracts in the business's name.

- Inform suppliers, customers, and any employees about the change in ownership.

- Consider if any changes are needed to the business model or operations.



6. Professional advice:

- Accountant: For tax planning, financial management, and advice on business structure… and funny enough I’m a specialist in small business accounts. Reach out if I can help, my contacts are in the signature below

- Solicitor: For legal advice on ownership transfer and business structure.

- Business advisor: For guidance on business strategy and operations.



7. Training and support:

- Consider courses or mentoring in retail management if you're new to this sector.

- Look into local business support networks or chambers of commerce for advice and networking opportunities.



Remember, you don't have to make all decisions immediately. Focus on maintaining the business's operations and customer base while you work through the legal process and consider your options.

 

[chlodah]

I'm sorry for your loss. This is a complex situation that requires careful consideration of legal, financial, and practical aspects.



Here's some guidance to help you navigate this process:



1. Immediate steps:

- Continue operating the business as you are, but keep meticulous records of all income and expenses.

- Open a separate bank account for the business to keep its finances separate from personal accounts.

- Inform HMRC about the change in ownership and your intention to continue the business.



2. Legal considerations:

- While probate is ongoing, you're technically operating the business on behalf of the estate. The executor should provide written permission for you to do this.

- Once probate is complete, you can formally take ownership and decide on the business structure.



3. Business structure options:

- Sole trader: This is the simplest option and allows you to continue the business much as it was. You'll need to register as self-employed with HMRC.

- Limited company: This provides more protection for personal assets but involves more administrative work and different tax implications.



4. Financial considerations:

- Review the business's financial position, including any debts or liabilities you might be inheriting.

- Consider seeking professional valuation of the business assets.

- Plan for any potential inheritance tax liabilities.



5. Operational aspects:

- Review and transfer or renew any licenses, permits, or contracts in the business's name.

- Inform suppliers, customers, and any employees about the change in ownership.

- Consider if any changes are needed to the business model or operations.



6. Professional advice:

- Accountant: For tax planning, financial management, and advice on business structure… and funny enough I’m a specialist in small business accounts. Reach out if I can help, my contacts are in the signature below

- Solicitor: For legal advice on ownership transfer and business structure.

- Business advisor: For guidance on business strategy and operations.



7. Training and support:

- Consider courses or mentoring in retail management if you're new to this sector.

- Look into local business support networks or chambers of commerce for advice and networking opportunities.



Remember, you don't have to make all decisions immediately. Focus on maintaining the business's operations and customer base while you work through the legal process and consider your options.

That’s brilliant advice thank you Rob

 

[JEREMY HAWKE]

Your not getting good advise and a solicitor knows very little about running a business
You may want an accountant that is more suitable for you and it is worth looking around

Being a member on this site will help you a lot and there are always people willing to answer your questions

 

[Mark T Jones]

There are 2 distinct and separate facets here - the first being probate which can only fe dealt with by ghe lawye, though it might be useful to talk with the executors to see if there is any likely objection or conflict.

Until probate is settled you can't own the business , though I can't see why you couldn't draw a wage as manager (the lawyer should advise)

Once probate gets close, then you should think about legal structures, bank accounts etc

 

[chlodah]

Very recently someone I cared for sadly passed away. They left me their business which was a really successful and well established retail outlet. He operated as a sole trader so in effect his business went with him. I’d like to carry it on in his honour but don’t know where to start! The solicitor is doing the probate thing which will take up to 18 months, I’m running the business now but can’t take a wage - which is fine in the short term as I’m employed elsewhere. I haven’t got a clue where to start is anyone able to advise where I can go for advice? I don’t mind paying for it. His accountant said the solicitor would advise but he just deals with probate. I spoke to a commercial expert and he said about registering as a limited company? But I’d rather just carry on as a sole trader I think. Any advice or direction appreciated. Thank you.

 

[chlodah]

EDIT - sorry should have mentioned I’m also the executor of the estate and sole beneficiary, so i’m my own decision maker. I’m guessing I need to find a decent accountant who has dealt with probate issues in the past.

 

[Paul Kelly ICHYB]

Rob has given some excellent advice.

Where are you based?

 

[chlodah]

Rob has given some excellent advice.

Where are you based?

I’m in south east London

 

[Deleted member 362062]

I’m in south east London

I do work nationwide

 

[Paul Kelly ICHYB]

I am in West London and Bermondsey every Friday - happy to meet for a coffee and a chat so you can brain dump and get some independent advice (for free!!!!!).

 

[Socio South West]

The old saying 'where there's a will, there's a family' will hopefully not come in to play, and you can have a clear run at getting the estate sorted and everything transferred into your name without near relatives causing you any problems or delays.

Hoping that the solicitor is not an executor as this will slow things incredibly. Remember that you are the client.... you instruct them.

The free advice offered will be valuable: Grab it!

The big things with respect to the ongoing welfare of the business until you can take full control and ownership....

- Keep your suppliers paid and onside with you (this includes any staff)
- Keep the business trading its usual regular hours: So many small businesses start messing with their hours which only serves to direct your customers elsewhere.
- Keep your financial records straight - especially if the business is VAT registered.

Whether you incorporate or remain as a sole trader is something you need to decide on the basis of advice specific to the situation that will be wider than the discussion here: There are pros and cons of both for a small business.

 

[Nathanto]

They left me their business which was a really successful and well established retail outlet.

The starting point has to be what exactly have you been left? What is the exact wording of the will? Are there other beneficiaries who are entitled to other parts of the deceased's estate?

For example, have you been left a mortgage/lease free retail outlet? All the existing stock? The existing business bank account balance once any debts have been cleared? etc...

 

[IanSuth]

The starting point has to be what exactly have you been left? What is the exact wording of the will? Are there other beneficiaries who are entitled to other parts of the deceased's estate?

For example, have you been left a mortgage/lease free retail outlet? All the existing stock? The existing business bank account balance once any debts have been cleared? etc...

If there is a lease and you need to get it novated into your name get specialist legal advise - you are not an experienced retailer from what you have said and this site is littered with stories of sole traders stitched up by not reading their commercial leases (and ltd owners made to sign personal guarantees)

Something else to think about is utilities - as the previous owner was a sole trader the utilities will have been in his personal name, speak to someone like @NickGrogan before picking the phone up to them as you could end up in issues (i don't know, i may be wrong but i would guess you will need new supply contracts)

 

[SwiftAcc Blink]

I'm sorry for your loss. It's great that you want to continue the business. First, consult an accountant to help with finances and tax compliance. You may need to register the business in your name and update licenses and permits to ensure they are current. Additionally, review and update the business insurance. Seeking legal advice from a solicitor can help with legal requirements and the probate process. For more help, consider speaking with us Swiftacc or your local Chamber of Commerce. Good luck!

 

[fantheflames]

First off, I'm very sorry for your loss. I hope you're receiving the support you need. Inheriting a business can be overwhelming at the best of times, but it’s admirable that you want to carry it on in honour of your loved one

Since you’re looking for direction, a good starting point would be to consult both a business advisor and an accountant with experience in probate issues. It very much sounds like you're going that direction, which is good!

Professionals like those can guide you through the legal and financial side of things. Additionally, consider joining local business support groups or chambers of commerce to connect with others who have faced similar situations and can offer advice and support.

As you know, this is a great forum for help and support. Sometimes you need extra support to find out the answers for your circumstances. There's so many great people who visit UKBF daily and weekly, so I'm glad you made the decision to reach out. Welcome to UKBF @chlodah

 

[Gecko001]

I would stick with the advisors your have a present, ie. the firm's accountant and the solicitor who is handling the probate.

In a case such as inheriating a business, you will need a lot of legal advise, so the accountant referring you to the solicitor is not fobbing you off, but is recognising this.

As executor, you will have full responsibilty of making sure that the will is executed, but usually that means delegating most of these duties to a solicitor. You might have done this already. If you have then work closely with them. Do not try to do this on the cheap.

The accountants will help you to understand the finances of the business and guide you, but at the minute they cannot be paid by the estate so they are probably wondering if you will retain them when the business is eventually transferred to you. I would discuss the matter of retaining them now so that you can continue to get advice from them. Note solicitors can wait for years until they get paid, but accountants do not usually do that. BTW I am not an accountant or lawyer. Just someone who has been an executor a couple of times.