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SUCCESSION PLANNING FOR BUSINESS OWNERS

Owning a business in Dubai has many challenges and responsibilities. One of those is the continuity of your business in the event of your death or serious illness. Your family, business partners, employees, investors, suppliers and customers all rely on you to meet their needs.

 

By going through the process of preparing a succession or business continuity plan, your business is able to consider its response to the situation. Making carefully thought through decisions without being under pressure will result in better decisions should you come to need to enact the plan. It will provide all parties with a clear understanding of what to expect and what is expected of them.

 

One important aspect of succession planning ensures your family receive the value of your share of the business and not the shares themselves. This separates their financial security from your business. It also enables your business partners to continue the business without the involvement of your family who may not wish to be directly involved.

 

If you would like to know more about business continuity or succession planning for business owners in UAE, please contact us.

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WHAT HAPPENS IF I DO NOT HAVE A WILL?

In England & Wales, where no Will exists the deceased will be treated as having died ‘intestate’. For assets in the UK, married couples with children have a right to all of their deceased spouse’s personal effects as well as the statutory legacy sum (up to £322,000 from 26th July 2023). If the estate is worth more than the statutory legacy sum, 50% of the excess is passed to the surviving spouse and the remaining 50% is distributed equally between the deceased’s children. This can cause problems. For instance, where the main asset is the matrimonial home and one of the children wants their inheritance causing the property to be sold.

Where there are assets in UAE and there is no Will the situation is complex for expatriates, multiple factors such as family structure, type of asset, and the religion of the deceased are taken into consideration when the courts decide how to distribute the deceased’s assets. Recent changes in federal legislation have sought to improve clarity for non-Muslims and time will tell how each Emirate adopts the federal law.

For further information, please contact us.

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