Kerry Chaloner

Succession planning moves up the business agenda

18 Oct 2026

By Kerry Chaloner, regional financial planning manager, Armstrong Watson

For many, succession planning can sit on the list of important jobs to tackle ‘one day’, but Armstrong Watson’s latest Family, Privately Owned and Owner-Managed Business Survey suggests that day is arriving for a growing number of business owners.

As economic uncertainty, tax changes and demographic realities converge, more businesses are being forced to think carefully about what comes next.

Why succession planning matters now

Our survey found more than half (52%) of respondents are aged 55 or over, and 44% expect to leave their business within the next five years.

A further 27% anticipate their exit within five to 10 years.

Against that backdrop, it is encouraging that succession planning is receiving greater attention, with half of respondents stating they have already included exit or succession plans within their business plan.

However, the other half have not, highlighting that many businesses are still without a clear roadmap.

Impact of tax and policy changes

One of the most notable findings from this year’s survey is the impact that changes to Business Property Relief (BPR) and Agricultural Property Relief (APR) are having on decision-making.

The reforms, which limit the scope of Inheritance Tax relief on qualifying business and agricultural assets, are prompting many to reassess how wealth and ownership will be passed to future generations.

More than two in five respondents have already reviewed their succession plans as a result, including 23% who have taken action and 18% who are yet to act on their plans. A further 17% intend to review their position.

The influence of these changes extends beyond a simple review exercise.

More than 40% of respondents say the reforms have influenced decision-making around succession, sale or ownership structures.

While the succession of your business should never be driven solely by tax, changes to reliefs can materially affect the value transferred to the next generation and may prompt you to revisit arrangements that haven’t been reviewed for several years.

Planning for a successful transition

Open communication is often one of the most overlooked aspects of succession planning. If you’re considering passing your business to the next generation, the technical aspects of succession planning are only part of the picture.

Successful transitions also depend on whether your successors are willing, capable and prepared to take on the responsibility.

Just as importantly, succession planning should not be viewed as a single conversation that takes place shortly before retirement.

The most successful transitions are often those that have been years in the making, allowing time to develop leadership skills, transfer knowledge, test governance arrangements and gradually hand over responsibility.

Whether your successor is a family member, management team or external buyer, early planning will create more options and reduce the risk of disruption when the time comes for you to step back.

This is particularly important in family businesses, where commercial objectives and family dynamics are often closely intertwined.

Having clear discussions about roles, expectations and future ownership can help avoid misunderstandings and provide greater certainty for both the business and your family.

Alternative exit routes outside the family

Not every business is destined to remain within the family. Management and employee buyouts continue to appeal, with 11% favouring this route, while 7% are considering a move to an Employee Ownership Trust.

Others would prefer a sale to a third party, either to the highest bidder or to an acquirer who shares the values.

Perhaps most strikingly, 15% expect their business to cease altogether, while 14% admit they have not yet considered how they will exit.

Prepare for successful transition

Whether you plan to step away from your business in two years or 10, succession planning is most effective when it starts early and will put you and your business in a stronger position to adapt, whatever future policy decisions may bring.