2 minute read
Advice from Simpson Western
theMillwatermag
Business owners should keep their wills current
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Updating your will is one of those things that is often placed on the ‘to do’ list. If something happens to you and your will isn’t current, or properly considered, there can be huge headaches for everyone left behind – for your spouse or partner, your children, and for your business partners and fellow trustees.
The first step to take when you are updating your will is to list what assets you have. Your will only deals with things that you own in your personal name – not those things that you might have in a trust. If you hold assets in a trust, you should also have an up-to-date memorandum of guidance (also called a memorandum or letter of wishes) that lets your trustees know how, and when, you wish trust assets to be distributed.
You then need to work out to whom you would like to leave your assets, and on what terms. For example, would you want your 20-year-old child to receive control of your assets? Or would you prefer that someone else had control until your child is a bit older? An issue that many business owners fail to address is what would happen to their business assets if they die suddenly whilst they’re still working in the business. If you have a business partner, what would happen if you left your share of the business to your spouse? Would your spouse be able to work alongside your business partner? Would your business partner have the financial means to buy out your spouse? All of these aspects should be considered. Insurance arrangements and shareholder agreements should be revised, to ensure that they are consistent with your wishes set out in your will.
And it’s not only the business aspects of will-planning that you need to think about. If you are in a relationship and have children from an earlier relationship, you’ll need to consider what may be the conflicting interests of your current partner and your children in terms of your assets. It can be very complex to work through these issues but it’s important that you do so, as it can prevent your partner or spouse and children battling each other further down the track.
If you’ve not reviewed your will for a while, get it out of the drawer and have a good look to check if it still reflects your current situation wishes – in your personal relationship and also what’s happening in your business. And do the same with your trust.
KATRINA SIMPSON Solicitor SIMPSON WESTERN
CNR MILLWATER PARKWAY & POLARITY RISE, SILVERDALE DDI: 09 489 0756 P: 09 486 3058 F: 09 486 2235 www.simpsonwestern.co.nz
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