Advisors are a valuable asset when planning to leave your business.
It’s never too early to start planning for the sale of your business. What you don’t want is to leave it too late.
Whether your company is brand new or well-seasoned, right now could be the best time for you to consider how you will exit it. Early planning means you and your advisors can develop a strategy that ensures the best outcome.
There are many ways to transition ownership of your business. You may want to sell to a large corporation or you may plan to pass control to a family member. What’s important is planning the process carefully.
Start by considering why you want to sell your business. Your plan might be to:
- Take money out of your company
- Reap the rewards of the time and money investment you have made
- Retire completely and pursue personal passions
- Reduce your working hours
- Leave a legacy to your family or community
- Start another business
- Become an angel investor
It’s also important to know when you want to sell your business and what you want from the result.
Ask yourself these questions:
- Do you want to sell within a couple of years or a couple of decades?
- What do you financially need or want from your company?
- Do you want to continue working in the company or consulting with it after the sale?
- Will you start a company in a similar or completely different industry?
There are no right or wrong answers to these questions. Every business owner will different priorities, and it’s important you figure out what yours are.
Assemble your team of advisors
Professional advisors will help you consider your alternatives and make decisions. It’s important to work with advisors because an effective ownership transition plan is complex.
You’ll need tax and legal counsel, personal financial planning, and business valuation expertise.
Scotia is always here to help. Get in touch with a Small Business Advisor today to find out how we can assist your plans.
We can also draw on our industry contacts to help you assemble your advisory team.
Create a financial plan
For business owners, identifying the most tax efficient methods to receive income from a business starts early and continues right up to the date the business is sold.
The expertise of advisors, such as financial planners, accountants, lawyers, and wealth management experts, can have a significant impact on the financial results you achieve personally over your lifetime.
Your financial plan should also address estate planning, insurance, and tax issues such as:
- Creating a will
- Establishing appropriate powers of attorney
- Income and pension splitting
- Trust solutions and holding companies
- Charitable and legacy objectives
Before you take action on any of the information above, we recommend consulting with a qualified business advisor that understands your unique needs and situation for your specific business and/or personal plans.