If your partner is a business owner, are you a director/ shareholder?

[KnobJockey]

I'm not married to my partner, but we have a joint mortgage, a 10 month old, both work and contribute to a joint account. Both of us currently own another property, mine is rented out, his will be sold to fund work on our joint property, at which point we will move my rented house to joint ownership.

DP is now looking at leaving work to become self employed. He will use our joint money to set up, purchase a van, etc, and no doubt things will be slow for a little while. I am a bookkeeper, so will no doubt be involved with invoicing and accounts work, which I expect my time will be paid for.

I'm just mulling over about whether I need a discussion about this me being a director/ shareholder. It is likely to have another partner, so he may want to discuss the situation too.

Anyone been in this position? Are you a partner in the business? Or a b shareholder? Not sure this is the right area to post either.

I haven't discussed this with my DP yet, I have more understanding of this type of stuff, so its usual for me to research first.

I'm a co director in our business and also own 50% of another business.

For our joint business we are 50/50, one share each in a limited company.

I would put this in legal OP. Do you want to be a director and/or a shareholder and do you understand what the rights and obligations of each are?

Whatever you do, have it all documented in articles of association (which govern what directors can do etc) and a shareholders' agreement if you end up with shares. Yes, it will cost a little bit to draw up and yes, you think it isn't necessary because you wil always agree what to do but corporate law case law is littered with fall outs between shareholders of small companies. Get some tax advice as well.

No. My husband is MD of a ltd company. I am not named on anything. No would I wish to be. There is no advantage in it

If he’s using joint money then I think you should be. We were married when my DH set up so it wasn’t an issue for us

You might want to check your employment contract OP as you may need approval from your existing employer to be able to take up a directorship or secretarial role

No, same as a PP. DP is the co-owner of a business and I am not named on anything. No need to be.

Not every business is a limited company and actually if he is just getting started it may be much simpler if he is a sole trader.

Dh has a limited company. I’m not a director, for no reason other than we never got around to it. There are some minor tax advantages. He’s asked me to be and I said sure great, but it’s just the hassle of doing the paperwork. But we have separate personal finances (joint account for joint expenses only) and none of my money has ever been invested in the business. I help out in small ways with chatting to clients or helping with events sometimes, but that’s about it. I have my own very busy career and no real expertise in anything related to the business (other than sometimes there is wine involved and I like wine!).

If it's being set up with joint money then it's a joint venture and I'd want a legal stake in the company. That does mean sharing the risk as well as any reward of course.

I'm a business owner and my husband is neither a shareholder nor a director (we've been together since before the business was established).

Is he setting up a limited company or a partnership?

Have you actually discussed being paid for your time as a bookkeeper or are you just assuming?

My DH has a company. When he set it up we were both made Directors. He was the only shareholder and employee.
I was working at the time, so that was fine.

When I stopped working he added me to the business as an employee and I work very very part time for about £8000 per year.
This means that I still accrue National Insurance credits towards my pension and he can pay into my private pension for me from the company.

I own a business, my SO isn't a director/shareholder. I have my job, they have theirs.

My husband owns 1/3 of a limited company. I have a single B share with no voting rights so he can pay me a dividend. I also occasionally do work through the company for which I get paid an hourly rate.

I'm not a director though.

Have you had legal advice for all these endeavors?
I would do that first.

Is there a reason you're not married?

DH set up his own Ltd busines 10 years ago. I was named as the Company Secretary and had very little involvement with the business beyond that.

Many things changed over the years and 2 years ago I became a director with a 50% shareholding (we have one share between us).

If I was jointly funding the venture, I think I'd insist on being a Director from the outset.

A limited company will protect any assets that you own.

So sorry everyone, I posted this then had a busy couple of days and forgot all about it 🙈

@TheWayOfTheWorld I do understand the rights and responsibilities of the role (my job is office and accounts manager of a group of several small companies, so basically tell the director what needs doing and when!). Tax I'm fairly comfortable with what I know/ what I can find out/ where I can go for help if needs be 😊

My thoughts are around the split of ownership, and if this business succeeds but the worst happens to us, would I be left on a much poorer footing even though we've both grown the business.

@RantyAnty no legal advice yet, getting our thoughts in order before we commit the money.

We're not married yet as DP didn't want to earlier. It is on the cards for the near enough future, but in the meantime we will stay on equal footing financially, so as to not put myself at risk of being shafted. Hence this question!

@NothingIsWrong that's the other option...have DP as the director, me as a B shareholder in order to take the occasional dividend. Just worried I'm being blinded a little.

@Nyclair was the business running before the relationship? Was it set up with family money? If it was wildly successful (not saying it isn't!) and had been funding the family but you split up, would you expect to share that with your DP? What would you say if he asked you to be share holder/ director?

I’d be very wary about selling a property to put money into a new business. Especially one owned and run by someone else that’s set up just before we go into a recession.

Why are you taking a financial risk but getting no benefit ? If it’s such a good deal, let him fund it with his own money.

Do you work full time Or part time ? Who funded your maternity leave and have you paid back your pension ?

I agree you need legal advice before you do anything. Or least do some very hard thinking about the risks you are taking.

Remember that if / when you split, its you left holding the baby. You need to be hard headed here for your child’s sake.

No, I'm not a shareholder or director of DH's limited company.

We are married, so I think that protects me in the event of us splitting.

The company didn't require investment (other than DH quitting his job, so me being the one with a reliable salary).

Being a company director is a serious commitment. If you mess up then it can be a criminal offence and ignorance of your duties is not a defence. I don't want this responsibility with DH's company as any issues could cause me issues with my professional registration.

I’m a director (50:50) in the ltd company that owns the premises but not in the business that DH runs out of it. The business rents from the company that I’m partner in so if we split then I would still expect that income. There is also another tenant. I made a financial contribution and a time contribution to setting up DHs business but I have no idea if I would have a claim on it if we split. He pays himself a wage which is “family money” but I guess he could sell the business or fold it and I’d have no real say.

@user1294625849274
At the minute exploring options, but it would likely be a limited co, joint directors. Not discussed me being paid for the hours, but if he wants to do it himself then fine 😂 in all seriousness, while the company is in growth period, it might not be achievable, but hopefully long term there's enough profit in it to do so.