Business LPA: Protecting Your Company

By Matt Cresswell, Founder of Power of Attorney Online and author of
Everything you ever wanted to know about LPAs (but were afraid to ask)

10th August 2026

If you’re searching for Business LPA: Protecting Your Company, there’s a good chance you’ve already thought about what would happen to your family if you became seriously ill. Far fewer business owners stop to consider what would happen to their company.

It is an uncomfortable subject, but an important one. Every year, thousands of business owners experience strokes, serious accidents, dementia, brain injuries and other illnesses that affect their ability to make decisions. For many families, the financial impact isn’t limited to personal finances. Their business can grind to a halt almost overnight.

The surprising part is that many owners already have a personal Lasting Power of Attorney and assume it covers everything. In many cases, it doesn’t.

If your business provides your family’s income, employs staff or has ongoing contractual commitments, planning for loss of capacity should sit alongside tax planning, succession planning and making a Will.

Why business owners face a different risk

Most people think about a Lasting Power of Attorney in terms of paying household bills or making healthcare decisions.

Business owners have another layer of responsibility. There may be employees expecting wages every month. Suppliers need paying. Customer contracts need signing. Tax returns have deadlines. Payroll has to run. Invoices need approving. Banks often require authorised individuals to approve significant payments or changes to accounts.

If nobody has authority to act, these everyday tasks can quickly become major problems.

Unlike death, where directors, executors or shareholders often have established procedures, mental incapacity creates uncertainty. The business still exists, but the person responsible for making decisions suddenly cannot make them. That legal gap is where businesses often run into difficulty.

The scenario most owners never expect

Imagine you own a successful engineering company.

You’re the sole director. You are also the only authorised signatory on the company’s bank account.

One morning you suffer a serious stroke. You survive, but doctors say you no longer have the mental capacity to make financial decisions.

Your spouse knows everything about your personal finances. She even has authority under your Property and Financial Affairs LPA.

Surely she can run the business?

Not necessarily. Your personal LPA relates to your own financial affairs. It doesn’t automatically give authority to act for a limited company.

Meanwhile:

• Staff wages are due.
• VAT payments are approaching.
• Suppliers are waiting.
• Customer contracts need signing.
• Insurance renewals require approval.

Within days, what started as a health crisis can become a business crisis.

Why your personal LPA often isn’t enough

This is probably the biggest misconception business owners have. People understandably assume that because they own the business, their personal attorney can simply take over.

Unfortunately, company law is rarely that straightforward.

A limited company is its own legal entity. The company’s assets belong to the company, not directly to the individual shareholder or director.

That distinction matters.

An attorney appointed under a personal Property and Financial Affairs LPA generally acts on behalf of the individual.

Business authority depends on several factors, including:

• how the business is structured
• what the company’s Articles of Association say
• whether shareholders remain able to appoint directors
• what the bank’s mandate allows
• whether other directors already have authority.

Sometimes a personal attorney can carry out certain tasks. Sometimes they can’t. Sometimes the company’s own governing documents prevent it altogether.

Different business structures create different problems

Not every business faces the same risks.

The legal position changes depending on how the business operates.

Business type	What usually happens if the owner loses capacity
Sole trader	Business decisions effectively stop unless someone has appropriate authority under an LPA.
Partnership	Partnership agreement determines what happens. Remaining partners may continue operating depending on its terms.
LLP	Existing members often continue, but key management responsibilities may still be affected.
Limited company with several directors	Other directors may continue running the business, although certain shareholder decisions can become difficult.
Sole director limited company	Often the highest-risk situation because nobody may have authority to manage company affairs immediately.

This is why there isn’t a one-size-fits-all answer.

The legal documents governing your business matter just as much as the LPA itself.

Sole directors face the greatest risk

Many small businesses across England and Wales are run by one person. That owner is often:

• sole shareholder
• sole director
• only bank signatory
• only person authorised to sign contracts.

Everything works perfectly until something unexpected happens. If capacity is suddenly lost, there may be nobody legally able to carry on running the company.

Even businesses with healthy cash flow can experience immediate disruption simply because nobody has authority to access it.

One delayed payroll can damage staff confidence. Missed supplier payments can affect trading relationships. Unanswered customer enquiries can damage reputation.

The longer uncertainty continues, the harder recovery often becomes.

The hidden problem inside your Articles of Association

Many business owners have never looked at their company’s Articles of Association since incorporation.

Yet these documents can have enormous consequences if capacity is lost.

Some Articles automatically terminate a director’s appointment if they lose mental capacity. Others contain restrictions on who may appoint replacement directors.

Some older Articles were never drafted with modern LPAs in mind at all. This can create a legal deadlock.

Your attorney may have authority over your personal affairs.

But the company constitution may prevent them exercising control over the company itself.

It’s one of the reasons specialist advice is often worthwhile for business owners. Reviewing your Articles before a crisis is far easier than trying to untangle them afterwards.

Why banks become another obstacle

Business banking introduces another layer of complexity. Banks have strict obligations around fraud prevention and corporate authority.

Even where an attorney has legal authority, the bank will usually need to verify:

• the registered LPA
• proof of identity
• authority under company documents
• bank mandate requirements.

Until those checks are complete, transactions may be delayed.

If no suitable authority exists, accounts can effectively become frozen for day-to-day business purposes. That can happen even when there is money available to pay wages or suppliers.

Why a Business LPA is different from your personal LPA

This is where things often become confusing.

A standard Property and Financial Affairs Lasting Power of Attorney is designed to allow someone to deal with your personal financial matters. That includes things like managing your bank accounts, paying bills, handling investments or selling your home if necessary.

A Business LPA has a much narrower purpose. Its role is to allow someone to deal specifically with your business interests.

Keeping those responsibilities separate often makes practical sense.

For example, your spouse might be the perfect person to manage your household finances if something happened to you. They know your personal circumstances, understand your wishes and already deal with many day-to-day financial matters.

That doesn’t necessarily mean they’re the right person to negotiate commercial contracts, oversee payroll or make decisions affecting your employees.

Likewise, your business partner may know your company inside out but have no involvement in your personal finances.

Separating the two roles allows each person to focus on what they know best.

For many business owners, that creates a more balanced and practical arrangement.

Choosing the right business attorney

Choosing a business attorney is often more about competence than family relationships. Trust is still essential, but so is commercial understanding.

The person you appoint doesn’t need to know every detail of your business today. They do need to be someone who can make sensible decisions under pressure and act in your best interests.

You might choose:

• a fellow director
• a business partner
• a trusted senior employee
• your accountant
• a long-standing adviser
• a close family member who already understands the business.

There isn’t one correct answer. The best choice depends entirely on how your business operates.

For example, if you’re a sole consultant working from home, your spouse may already understand everything needed to keep the business running.

If you own a manufacturing company employing fifty people, another director may be the obvious choice instead.

The important point is that you are making the decision while you still have capacity, rather than leaving others to solve the problem later.

Should you appoint more than one attorney?

Many business owners ask whether appointing multiple attorneys is safer.

Sometimes it is. Sometimes it creates unnecessary complexity.

If every decision has to be agreed jointly, day-to-day business can slow down considerably.

Imagine trying to approve urgent supplier payments while one attorney is on holiday overseas. Or signing an important contract when everyone has to be physically available.

This is why many business owners choose attorneys who can act jointly and severally, meaning each attorney can usually act independently if needed.

That gives flexibility while still providing oversight.

The exact appointment should always reflect the way your business actually operates.

A small family company has very different needs from a larger organisation with multiple directors and shareholders.

Should your business attorney be different from your personal attorney?

In many cases, yes.

This is one of the biggest advantages of creating separate arrangements. Think about the different decisions involved.

Your personal attorney might need to:

• manage household finances
• pay utility bills
• oversee pensions
• arrange care fees
• deal with your mortgage.

Your business attorney may instead be responsible for:

• approving payroll
• negotiating contracts
• authorising purchases
• speaking with suppliers
• managing cash flow
• overseeing employees.

Those are completely different skill sets.

Separating the appointments allows each person to focus on decisions they feel comfortable making. It can also reduce family tension.

We’ve spoken to many business owners who worry about placing too much responsibility on one individual. Splitting personal and commercial responsibilities often gives everyone greater confidence.

Running personal and business LPAs side by side

One of the most effective planning strategies is to have both. Rather than replacing your personal LPA, a Business LPA complements it.

Together they create a much clearer framework for decision-making.

Personal LPA	Business LPA
Personal bank accounts	Business bank accounts
Household bills	Payroll
Investments	Supplier payments
Pension income	Commercial contracts
Personal property	Company operations
Care funding	Business continuity

When drafted properly, each attorney understands where their responsibilities begin and end.

That clarity can prevent misunderstandings during what is often already a stressful time.

What happens if you don’t have a Business LPA?

The consequences depend on your business structure.

For some businesses, little changes. For others, everything changes.

Let’s look at two examples.

Sarah owns a marketing consultancy

Sarah works alone. Her husband already helps with invoicing and bookkeeping.

If Sarah loses capacity, her personal attorney may be able to continue dealing with many aspects of her affairs, depending on the circumstances.

There are relatively few operational complications.

James owns a construction company

James employs twenty-two staff. He’s the sole director.

Only he can approve payments over £10,000.

He signs every customer contract.

His business account requires his authorisation.

James suffers a severe brain injury.

Within days:

• payroll is delayed
• subcontractors stop work
• customers cannot get contracts signed
• suppliers suspend deliveries
• cash flow begins deteriorating.

The difference isn’t the seriousness of the illness.

It’s the complexity of the business.

Business continuity is about more than money

Many owners understandably focus on turnover and profits. But business continuity affects people too.

Employees rely on wages.

Customers rely on your products or services.

Suppliers rely on long-standing relationships.

A sudden loss of leadership can create uncertainty across the whole organisation.

Planning ahead isn’t simply about protecting your own financial interests. It’s about protecting everyone who depends on the business continuing to operate.

For family-run businesses, that often includes several generations.

A conversation worth having with your accountant

Many accountants spend time discussing tax efficiency, dividends and year-end planning.

Far fewer business owners ask a simple question:

“What would happen if I couldn’t make decisions for six months?”

It’s an incredibly valuable discussion. An accountant can help identify practical issues such as:

• who currently has authority over company finances
• who can authorise payments
• whether bank mandates need updating
• whether your Articles of Association should be reviewed
• how shareholders could be affected.

Those conversations often reveal weaknesses that owners had never considered.

What we’ve seen reviewing business owners’ applications

At Power of Attorney Online, we’ve reviewed thousands of LPA applications.

One pattern appears regularly.

Many business owners carefully choose attorneys for their personal finances but have never considered how their company would continue operating if they suddenly became unable to make decisions.

It’s rarely because they’ve ignored the issue. More often, they’ve assumed their existing LPA automatically covers every aspect of their life.

For many limited company directors, that’s simply not the case.

Identifying that gap before a crisis develops is usually far easier than trying to solve it afterwards.

Business planning and succession planning aren’t the same thing

Many owners already have succession plans. They know who will eventually take over the business.

That doesn’t necessarily solve a temporary loss of capacity. Succession planning usually deals with retirement or death.

A Business LPA helps cover the period when you’re still alive but unable to make decisions yourself.

That distinction is important.

Some people recover from serious illness. Others experience fluctuating capacity.

A Business LPA provides continuity during periods when help is needed without permanently handing over ownership of the business.

What does a Business LPA cost?

One reason many business owners put this off is because they assume it will require expensive legal advice.

In reality, the cost depends on how much support you need. If your business structure is straightforward and you understand who you want to appoint, an online LPA service can often provide everything you need at a fraction of the cost of a traditional solicitor.

More complex arrangements, particularly where bespoke company documentation or Articles of Association need reviewing, may justify taking specialist legal advice alongside creating your LPA.

The important thing is not necessarily choosing the cheapest option.

It’s choosing an approach that gives you confidence the documents are completed correctly and reflect how your business actually operates.

Option	Typical cost	Suitable for
Complete directly through GOV.UK	OPG registration fee only	Confident users comfortable completing legal forms without guidance
Guided online LPA service	Service fee plus OPG registration fee	Most straightforward businesses wanting support and expert checks
Solicitor	Usually several hundred pounds or more, plus OPG registration fee	Complex company structures or bespoke legal advice

Whichever route you choose, the cost is often modest compared with the potential financial impact of your business being unable to operate for weeks or months.

Five practical steps every business owner should take this week

Planning for loss of capacity doesn’t have to become another project that sits on your to-do list for months. Most business owners can make significant progress in an afternoon.

Start by asking yourself five simple questions.

First, who currently has authority to keep the business running if you suddenly couldn’t make decisions tomorrow?

Second, would your bank allow someone else to operate your business accounts?

Third, have you actually read your company’s Articles of Association, or are you assuming they’ll work as you expect?

Fourth, are the people you’ve appointed to manage your personal affairs also the right people to make commercial decisions?

Finally, if you were admitted to hospital this evening, how long could your business continue operating without you?

If any of those questions leave you uncertain, it’s worth addressing the issue now while you remain in control.

Common mistakes business owners make

After helping thousands of people prepare Lasting Powers of Attorney, we’ve noticed that business owners often make the same assumptions.

The first is believing that a spouse or adult child can simply “step in.”

Legally, that’s often not the case.

The second is assuming a personal Property and Financial Affairs LPA automatically covers company decisions.

Sometimes it helps. Sometimes it doesn’t.

The answer depends on the structure of the business and the company’s governing documents. Another common mistake is appointing attorneys who know very little about the business itself.

Trust matters, but so does capability. Someone who understands your customers, staff, financial commitments and day-to-day operations is usually in a much stronger position to keep things moving.

Finally, many owners simply delay making any arrangements at all.

The irony is that people often spend months planning for retirement while spending almost no time planning for the possibility of temporary incapacity.

Business continuity starts long before an emergency

The best business continuity plans aren’t written during a crisis.

They’re prepared beforehand.

A Business LPA should sit alongside other important planning documents, including:

• your Will
• shareholder agreements
• partnership agreements
• succession plans
• key person insurance
• business protection insurance
• company Articles of Association.

Each document serves a different purpose. Together they provide resilience when life takes an unexpected turn.

Frequently Asked Questions

Can I have both a personal LPA and a Business LPA?

Yes. In fact, many business owners choose this approach. Your personal LPA deals with your own finances and welfare, while a Business LPA focuses on your commercial interests. Different attorneys can be appointed for each if appropriate.

Is a Business LPA a separate legal document?

Not exactly.

A Business LPA isn’t a different type of Lasting Power of Attorney created by the Office of the Public Guardian.

Instead, it is a Property and Financial Affairs LPA that has been prepared specifically to deal with business interests, often alongside appropriate legal advice and consideration of the company’s governing documents.

Can my spouse automatically run my company if I lose capacity?

Not necessarily.

Even if your spouse owns shares or is your personal attorney, company law, banking rules and your Articles of Association may affect what authority they actually have.

What if I already have another director?

Having additional directors may reduce the practical impact if one director loses capacity.

However, it doesn’t automatically solve every issue.

Shareholder decisions, banking arrangements and company constitutional documents may still require review.

Can my accountant be my business attorney?

Potentially, yes.

There’s no rule preventing a professional adviser from acting, provided they’re eligible and willing to accept the responsibility.

Whether that’s the right decision depends on your individual circumstances.

What if I recover?

That’s one of the strengths of a Lasting Power of Attorney.

If you regain the ability to make your own decisions, you simply resume making them yourself.

The attorney’s role is to support you when necessary, not permanently replace you.

Can I change my business attorney later?

Yes.

Provided you still have mental capacity, you can revoke an existing LPA and create a new one if your circumstances or business change.

The real value isn’t the paperwork

It’s easy to think of a Lasting Power of Attorney as another legal document to file away in a drawer.

For business owners, it’s much more than that.

It’s a continuity plan.

It’s protection for your employees.

It’s reassurance for your customers.

It’s confidence for your family.

Most importantly, it allows you to decide who would protect everything you’ve worked so hard to build.

Without that planning, someone else may eventually make those decisions for you, or there may be no one with the authority to act when your business needs it most. The best time to put those arrangements in place is before they’re ever needed.

If you’ve already started thinking about what would happen to your business if you lost capacity, you’re asking exactly the right question. Taking the next step now could save your family, your employees and your company months of uncertainty in the future.

Ready to protect your business and your family?

Whether you complete your Lasting Power of Attorney yourself through GOV.UK, use a guided online service or seek advice from a solicitor, the important thing is not to leave the decision until a crisis forces it.

At Power of Attorney Online, we help people create professionally checked Lasting Powers of Attorney that are clear, accurate and designed to avoid common mistakes that can delay registration. If you’re a business owner and you’re unsure how your company fits into the picture, we’re also happy to explain where a standard LPA ends and where additional business planning may be appropriate.