Planning of business succession
Handing over a business to the next generation or to a successor is a long-term process. Inheritance law, company law and tax matters must be coordinated. We advise business owners on the legal structuring and work closely with tax advisers and notaries.
The key points at a glance
Lifetime transfer and succession
Succession can be arranged during your lifetime by way of anticipated succession or by disposition upon death. In the case of lifetime transfers, the transferor can secure their position, for example, through a usufruct, maintenance payments or rights of reversion.
Alignment with the articles of association
Where interests in partnerships or corporations are concerned, the partnership agreement or articles of association help determine who may become a successor. Succession clauses in the articles of association and testamentary provisions must be consistent, otherwise the intended succession may fail.
Compulsory share risks
Claims to a compulsory share and to its supplementation by relatives who do not take over the business can place a considerable strain on the company's liquidity. Planning tools include notarial waivers of the compulsory share in return for a settlement payment and an early transfer, since gifts carry less weight over time when the compulsory share supplement is calculated.
Safeguards and tax
A business power of attorney or lasting power of attorney ensures that decisions can still be made in the event of illness or accident. Executorship can safeguard the continuation of the business. Inheritance tax law provides relief for business assets under certain conditions, which requires coordination with your tax advisers.
How we proceed
We review the company structure, articles of association, family circumstances and your objectives, and identify where action is needed and what risks exist.
Together with your tax advisers, we develop a coordinated plan comprising lifetime transfers, a will, amendments to the articles of association and powers of attorney.
We draft the necessary agreements and dispositions, accompany discussions with those involved and coordinate the notarial recording with the notary.
Frequently asked questions
When should I start planning my succession?
Ideally several years before the planned handover. This leaves time to train a successor, to reach agreement with family members and to make use of planning options that depend on time.
What happens if no succession has been arranged?
In that case, the statutory rules of succession apply, unless the articles of association provide otherwise. Several heirs form a community of heirs, which can make it more difficult to continue the business.
Your contact
Talk to us.
Gewürzmühlstraße 5 · 80538 Munich