What happens to sole traders, partnerships, LLPs and company shares, including director replacement, valuation and current Business Relief rules.
This guide is part of ProbateHelp's Estate Assets guide cluster. Estimated reading time: 10 min.
The sole trader and business are not separate legal persons, but that does not mean every trade must stop immediately. Personal representatives may preserve, wind down, sell or temporarily carry on activity where they have authority. Contracts, licences, tax, employees and personal liability need urgent review.
Section 33 of the Partnership Act 1890 says death dissolves a partnership subject to any agreement between the partners. A partnership agreement can provide continuation, valuation and purchase terms, so it must be checked before relying on the default rule.
No. The company remains a separate legal person. Its shares form part of the estate, but directors manage the company. If a sole director dies, the articles and surviving membership determine how a replacement director can be appointed.
Not merely by being executor or shareholder. Share ownership and the office of director are different. A personal representative may exercise transmission or voting rights when recognised under the articles, but management decisions require a properly appointed director.
For deaths on or after 6 April 2026, GOV.UK caps 100% Agricultural and Business Relief at a combined £2.5 million allowance. Qualifying value above it normally receives 50% relief. Unused allowance from a spouse or civil partner can increase the available amount up to £5 million.
No. Ownership period, business activity, asset use, binding sale arrangements and exclusions matter. Investment businesses and assets not needed for future business use can fail or restrict the claim. Report the facts and obtain tax advice rather than applying a percentage automatically.