Family business succession and faraid
A business is often a family’s biggest asset. Without a plan, passing it on can lead to tax problems, disputes and a division that does not follow faraid. We help plan succession in line with faraid and English law, with a tax adviser where tax is involved.
The particular challenge
In a family business, the hardest questions are rarely purely commercial. Who owns what? How are roles decided among relatives? How is profit shared fairly? What happens when the founder steps back or passes away? Handled badly, these questions divide families.
A faith-sensitive approach
We bring together the commercial, the legal and the Islamic. That means ownership and profit structured on Islamic principles, roles and expectations set out clearly, and succession planned in line with faraid, so each person’s position is clear from the start.
Clear written terms are not a sign of mistrust. They help families and businesses avoid misunderstandings later.
Why succession needs planning
When an owner dies without a succession plan, the business can be thrown into uncertainty overnight. Who now owns it? Who runs it? How is it divided among heirs? Without a plan, the result can be a family dispute, and sometimes the loss of the business itself.
Faraid and the family business
Islam sets fixed inheritance shares, faraid, that apply to a business just as they do to other wealth. But a business cannot always be split into neat shares like cash. Planning is what reconciles the two: honouring each heir’s faraid share while keeping the business alive and workable.
Good succession planning aims to respect your heirs’ faraid shares while keeping the business running.
How we help
We help you plan your succession in writing.
- Structuring ownership so the business can pass on smoothly
- Reconciling faraid shares with a workable business structure
- Reducing legal complications for your heirs, with a tax adviser where tax is involved
- Documenting a clear plan properly under English law
- Structuring ownership and profit-share the halal way
- Setting clear roles, terms and expectations among family
- Planning succession in line with faraid
- Resolving disagreements fairly through mediation where needed
All reserved legal work is carried out by our partner solicitors.
Talk to us
Tell us briefly what is happening. We will call you back and explain your options, in your religion and in English law.
- We aim to reply within one working day
- In English, Arabic or Urdu
- No obligation to go further
Prefer to talk? Call 020 3930 1088