Many small businesses are hugely dependent on one or two people – typically the business founders or principal directors. So what would happen to the company if its key people were unable to perform his or their duties for an extended period – because of a serious accident or ill-health, for example? And what if that person(s) doesn’t even have the capacity to take decisions or issue instructions?
If the worst happens, your business will be in much better shape if you have set up a Lasting Power of Attorney (LPA). This is a legal document that gives power to a named individual(s) who you trust to act on your behalf if you lose the capacity to do so for some reason.
There are two types of LPA: Health and Welfare LPAs empower someone to make decisions about your health and medical treatment if you’re not in a position to do so, while Financial LPAs confer powers over your financial and business affairs. Both documents are important, but from a small business perspective, it’s the second type of LPA that can prove particularly crucial.
Without such a document in place, anyone stepping into the breach to look after your business for a period is likely to find life very difficult. They may find difficulty in dealing with your business’s bank for example. There would also be no one with legal authority to sign important legal documents on your behalf, eg, the Company Accounts. Most other institutions – from the local council to utility providers – are not legally allowed to discuss your affairs with anyone else unless you have an LPA in place. The absence of a Lasting Power of Attorney could rapidly prove disastrous for your business, which may spin into terminal decline simply because no-one is able to take charge of its affairs – even if there are people who can do the work that the business delivers, you need someone with the legal power to run the business.
In theory, it is possible for relatives to apply to the Court of Protection for special powers in the event that you suffer a loss of capacity without having set up an LPA. In practice, however, this takes months to arrange and it is an extremely expensive option.
Too few small business owners have set up LPAs. Any small business owner or operator should think carefully about what would happen to their business if they became unable to make decisions through accident or illness, and what this would mean for them and their employees’ financial future.
Having an LPA also alleviates the stress for family members.
For more information on Lasting Powers of Attorney contact :
Gary Taylor
Director
Progressive Wills Ltd.
Tel: 07543238543
Email: progressivewills@gmail.com
Progressive Wills Ltd makes the process of making a will as convenient and easy as possible. Our experienced consultant is fully trained in Wills Probate Powers Of Attorney Trusts and Court Of…
Post articles and opinions on Professionals UK
to attract new clients and referrals. Feature in newsletters.
Join for free today and upload your articles for new contacts to read and enquire further.
