Generational changes in companies are often intricate processes. Many decisions have to be made, weighing up and prioritising a multitude of factors.
When transferring a company to a new owner, both the interests of the company and the owner's own wishes for the future play a crucial role. Other key considerations concern the financing of the generational change and any tax implications.
We have extensive experience in advising on generational change. We advise company owners from when they first begin to think about a generational change right through to completion. With our specialist knowledge of business law, tax law and family law, we can steer you safely through all the legal aspects and the whole process from start to finish.
We give courses in generational change to other advisers and act as specialist lawyers in connection with generational change cases. We are sometimes also asked to assist in cases in which a generational change has unfortunately gone wrong because tax rules were overlooked or misinterpreted. In such cases, our mission is to repair or mitigate the negative consequences.
A generational change usually involves certain gift elements. Questions arise in relation to the division of the older generation's assets subsequent to or during the generational change.
Depending on how a generational change is organised, various agreements are needed to manage the legal position of the parties. It is necessary for the parties to clearly define their mutual rights and obligations as well as other terms and conditions.
A generational change often involves a number of transactions that are carried out in succession. Unless the necessary legal documents are prepared, considerable problems may arise if one of the parties suddenly changes their mind and no longer wishes to proceed with the generational change.
There are a number of generational change models to consider in the planning of a generational change. The frameworks for these models are quite dynamic, especially from the point of view of tax law.
A generational change can be carried out in many different ways, depending on the needs of your company. In some cases, a concurrent change of ownership and management is deemed to have too much of an impact on operations.
A generational change may entail a number of different risks relating to the tax implications of such a step, for example regarding the preconditions for applying the various models, the valuation of the company etc.