I have set up a small craft business with a friend, and I know this sounds like a morbid question, but in the event of one of us dying, would the business partner automatically take over full ownership? EMILY SAYS: If there are two of you in partnership, and you haven’t put a formal partnership agreement in place, then if one of you dies, the partnership will die with them. If the surviving partner wants to carry on the business, that person will have to re-register with HMRC as a sole trader. I’d recommend putting a partnership agreement in place to deal with this and any other scenarios – for instance if either of you wants to leave the business, or if you want to bring in a third partner. Contact a solicitor to draw one up for you, or download a partnership agreement template online for free.
Put a partnership agreement in place,
just in case