What Happens to Your Business If You Die Without a Will? (Including sample Will)
Reframe Legal Blog | Strategic Legal Insights for Business Owners
Running a business demands vision, courage, and relentless problem-solving. But even the most capable founders often overlook one critical question:
What happens to your business if you die without a will?
The answer can be complex—and, for many Australian business owners, deeply uncomfortable. Whether you're a sole trader, in a partnership, or operating a company, dying intestate (without a valid will) can throw your business into chaos, delay operations, and leave your family or staff facing unexpected legal hurdles.
At Reframe Legal, we help business owners proactively plan for these “what ifs” before they become crises. Here's what every entrepreneur should know.
Why Estate Planning Matters for Business Owners
A business is more than just an asset. It's an income stream, a livelihood, and in many cases, a legacy. But unlike a personal bank account or a car, your business doesn’t automatically get passed on to your spouse or children when you die. It depends entirely on how your business is structured—and whether you’ve made legal arrangements to support that transfer.
Without a will, your business may be frozen, sold off, or taken through probate—causing disruption not only to your family, but also to your staff, your clients, and the value you’ve worked so hard to build.
What Actually Happens if You Die Without a Will?
When someone dies without a will, the law of intestacy kicks in. In New South Wales and most other states, this means:
The estate is distributed according to a fixed legal formula,
The courts must appoint an administrator to manage your estate,
Business ownership may be divided among family members who are not equipped to run it,
Your business may need to be wound up or sold quickly to pay debts or finalise the estate.
For sole traders, the business is treated as personal property. If no will exists, your family may not be able to access bank accounts, operate under your ABN, or continue trading legally—especially if your name is tied to supplier accounts, leases, or contracts.
In a company structure, shares form part of your estate. If there’s no will, those shares are distributed according to intestacy rules, which can lead to unqualified or uninterested family members becoming accidental shareholders.
In a partnership, things become even more complex. Your death may automatically dissolve the partnership, triggering the need to sell off assets or renegotiate with surviving partners. If you haven't made a will or outlined succession in a partnership agreement, the result can be legal confusion and financial loss.
The Real-World Impact: Why Timing Matters
Let’s say you're a sole trader running a physiotherapy clinic. You unexpectedly pass away without a will. Your spouse and employees may find they’re locked out of key systems. They may not be able to pay wages, cancel appointments, or communicate with patients. While they wait for a court to appoint an administrator, your reputation suffers, clients leave, and the value of your business plummets.
Even for structured businesses like companies, delays in transferring shares or voting rights can cause conflict or deadlock among remaining directors. Your business could be forced to pause or even shut down permanently if no one has clear authority to step in.
Estate Planning Isn't Just About Assets—It's About Continuity
Business owners often think of estate planning as a personal task—something for their superannuation or family home. But your will is the legal document that determines who has the authority to manage or wind up your business. It tells the court, your family, and your business partners who should step in and how things should be handled.
It also allows you to:
Appoint an executor with business experience or knowledge of your operations,
Nominate who should inherit or control your shares or interest in the business,
Create mechanisms (like buy-sell agreements or testamentary trusts) that keep your business running smoothly even after your death.
If you have minor children or dependents relying on the business income, a properly structured estate plan becomes even more essential.
What Should Business Owners Include in Their Will?
Your will should clearly outline:
Who inherits your business interests or company shares,
Who is authorised to make decisions for the business after your death,
How debts, tax, and liabilities linked to the business should be managed,
Whether your business should be continued, sold, or dissolved.
You should also ensure your estate plan aligns with your business documents, such as your company constitution, trust deed, or partnership agreement. If there are inconsistencies between your will and these documents, it can lead to delays or disputes.
Taking the First Step
It’s never too early to protect what you’ve built. Creating or updating a will may take only a few hours—but the impact can last for generations. At Reframe Legal, we offer thoughtful, strategic estate planning for business owners who want to avoid surprises, empower successors, and leave behind not just assets—but clarity and security.
If you run a business and don’t yet have a valid will, now is the time to act. If you already have a will but haven’t reviewed it since starting or restructuring your business, it’s time for a check-in.
Your business may be one of the most valuable things you ever create. Let’s make sure it’s protected.
We understand how personal and complex a business can be. At Reframe Legal, we work with entrepreneurs, practice owners, and professionals to ensure your business doesn’t get lost in the chaos of intestacy. We’ll help you create a plan that protects your vision, your people, and your family—no matter what comes next.
This blog is for general information only. It does not constitute legal advice. For advice tailored to your business structure and situation, please consult a qualified solicitor.
