Business assets and a lasting power of attorney

Business assets require separating personal ownership from a company's property. GOV.UK guidance on running a limited company explains the company's separate finances and directors' responsibilities. An owner's LPA should be assessed against that structure. ^[1]

Map the assets and the powers needed List personally owned shares, partnership interests, commercial property and loans to the business. Identify equipment, cash and contracts owned by the company itself. An attorney managing the shareholder's affairs does not thereby own or control every company asset.

Gather the articles, shareholder agreement, partnership deed and banking mandates. Ask which decisions involve ownership rights and which require a director or other authorised officer.

Check restrictions before a crisis Identify consent requirements, transfer restrictions and regulated activities. A personal appointment should not be assumed to delegate a director's office or bypass the company's decision-making rules.

Coordinate business-owner LPA planning with the company's continuity arrangements. Review succession under the will separately, because incapacity planning and death planning operate at different times. The inventory should help advisers identify gaps in authority rather than imply that one document solves every operational issue.

Separate the owner's wealth from the company's balance sheet List assets the individual owns personally, including shares, loans to the business and any property let to it. Then identify equipment, cash, intellectual property and contracts owned by the company itself. Use ownership records rather than a colloquial description that the founder owns everything. This distinction matters when identifying what an attorney may manage for the individual. A valuable shareholding does not mean every asset on the company's balance sheet becomes part of the donor's personal property for the attorney to transfer.

Record assets with mixed or uncertain arrangements. A vehicle may be used by the business but financed personally; premises may belong to several family members; a trade name may be registered in a different entity. Identify the documents needed to resolve each question. The inventory should expose uncertainty rather than conceal it in a combined total. Give advisers enough information to distinguish legal title, economic interest and practical use, since each may point to a different consent or decision process when action is required.

Identify the capacity required for each business decision Distinguish decisions made as shareholder, director, lender, landlord or account signatory. Those roles can overlap in one person during ordinary trading, making the differences easy to overlook until that person cannot act. For each important task, ask which capacity supplies the authority and what document governs it. GOV.UK's directors' guidance emphasises company rules and continuing responsibilities; appointing a personal attorney should not be assumed to transfer a director's office or remove the company's governance requirements. [1]

Use a practical example to test the distinction. Receiving a repayment of the donor's documented loan is different from authorising the company's payment, and exercising a shareholder right is different from signing a new supplier contract for the company. Ask the adviser to identify the route for each side of the transaction. A single individual may previously have performed both roles without difficulty, but a successor cannot assume the same combination of authority arises automatically from the LPA.

Review restrictions attached to the underlying interest Collect the articles, shareholder agreement, partnership deed, loan documents and relevant mandates. Identify transfer restrictions, approval requirements and provisions dealing with incapacity or changes in management. Where the business operates in a regulated field, ask whether professional or regulatory requirements affect who can perform particular functions. Avoid assuming that a broad financial appointment overrides those rules. The LPA is one part of the authority analysis, alongside the documents and law governing the specific asset, office or activity.

Consider third-party dependencies before planning a transaction. A lender, co-owner or contractual counterparty may need to consent to an action involving the donor's interest. Explain the proposed objective and obtain advice on the actual requirement. Do not promise that an attorney can sell or restructure the interest simply because that would provide funds for the donor. An asset may have substantial value while being difficult to realise quickly, and that practical limitation should be understood before it is relied upon in financial planning.

Turn the asset map into a targeted continuity brief For each important interest, record the ownership evidence, governing documents, adviser and unresolved authority question. Keep the brief separate from passwords and operational security information. Identify matters needing action before incapacity, such as clarifying ownership records or obtaining advice on an unsuitable governance arrangement. Avoid adding an informal note that purports to give the attorney powers missing from the legal documents. The brief should help the authorised people find the correct route, not create an appearance of authority through a convenient description.

Review the map after an acquisition, refinancing or change in business structure. A sole trader becoming a company, for example, can materially alter which assets and obligations are personal. Coordinate incapacity planning with the business's governance arrangements and consider death succession separately through the appropriate estate documents. The resulting preparation should make clear what belongs to the donor, which decisions an attorney may lawfully address and where another authorised person or legal process is needed to keep the business functioning.