Entrepreneurship & Small Business

Should I make my wife a director? Shareholder?

  • Last Updated:
  • Jun 4th, 2018 1:17 am
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Newbie
Apr 1, 2016
37 posts

Should I make my wife a director? Shareholder?

Worried about what might happen if I die. My business is just an ecommerce site... I am mostly worried about ensuring she gets any cash in the corporate bank account if something horrible is too happen
7 replies
Member
Jun 25, 2011
322 posts
109 upvotes
Alberta
Make her a shareholder. Don't forget to include yourself as shareholder as well. Probably keep yourself as a majority shareholder for those unforseen reasons if you get a divorce from your wife and you will retain the control. If in future your company becomes profitable and highly valued and you decide to sell it then you both can take capital gain exemption and get the money up to a limit will be tax free. Being a director won't do much.
Newbie
May 26, 2018
23 posts
2 upvotes
I am also starting a new company and was thinking of making my husband a director as well as 50% share holder. Is there any issue with making your spouse a director ?

Thanks
albertaguy wrote:
May 12th, 2018 10:44 am
Make her a shareholder. Don't forget to include yourself as shareholder as well. Probably keep yourself as a majority shareholder for those unforseen reasons if you get a divorce from your wife and you will retain the control. If in future your company becomes profitable and highly valued and you decide to sell it then you both can take capital gain exemption and get the money up to a limit will be tax free. Being a director won't do much.
Member
Jun 25, 2011
322 posts
109 upvotes
Alberta
Nbrocks wrote:
May 27th, 2018 2:14 am
I am also starting a new company and was thinking of making my husband a director as well as 50% share holder. Is there any issue with making your spouse a director ?

Thanks
There is no issue with your spouse to be a director.
Deal Guru
Aug 2, 2010
12537 posts
3072 upvotes
Here 'n There
Nbrocks wrote:
May 27th, 2018 2:14 am
I am also starting a new company and was thinking of making my husband a director as well as 50% share holder. Is there any issue with making your spouse a director ?

Thanks
Yeah if you divorce
Deal Addict
Aug 28, 2007
1848 posts
242 upvotes
Calgary
Shareholders elect Directors. Their number of votes is based on the % of shares they own or control.
Directors hire Officers (CEO, CFO etc). The Board of Directors has a chairperson and sub-committees. It is usually a specified number of members.
Officers delegate work to the lower level employee structure starting with the President and it ripples on down.

This generality applies to all corporations from mom-and-pop outfits to giant publicly listed companies. In really small businesses the same person covers all the roles, but the responsibility of authority still flows the same.

If you understand that pecking order, it will become self-evident where you can, should, or want to share power with a spouse or child. It all boils down to perceived risk, interpersonal trust and the potential scenarios around inheritance.
Deal Addict
Apr 2, 2008
1125 posts
204 upvotes
WinnipegRedFlager wrote:
May 12th, 2018 12:01 am
Worried about what might happen if I die. My business is just an ecommerce site... I am mostly worried about ensuring she gets any cash in the corporate bank account if something horrible is too happen
All you need is a will....And thank me later...

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