The following statement of Peano's axioms appears in Fundamentals of Mathematics, Volume 1 Foundations of Mathematics: The Real Number System and Algebra; Edited by H. Behnke, F. Bachmann, K. Fladt, W. Suess and H. Kunle
I. $1$ is a number.
II. To every number $a$ there corresponds a unique number $a^{\prime},$ called its successor.
III. If $a^{\prime}=b^{\prime},$ then $a=b.$
IV. $a^{\prime}\ne1$ for every number $a.$
V. Let $A\left(x\right)$ be a proposition containing the variable $x.$ If $A\left(1\right)$ holds and if $A\left(n^{\prime}\right)$ follows from $A\left(n\right)$ for every number $n,$ then $A\left(x\right)$ holds for every number $x.$
Typically an inductive proof of some proposition $P$ about the natural numbers proceeds as follows: show $P\left(1\right)$; show $P\left(n\right)\implies{P\left(n^\prime\right)}.$
I will say that a number succeeds $1$ if and only if it is the successor of $1$ or it is the successor of a number which succeeds $1$. Given the proposition
$$P\left(x\right):=\text{x does not succeed 1},$$
we have $P\left(1\right)$ is true. If we assume $P\left(n\right)$, then $P\left(n^\prime\right)$ follows. It is easy to show, however, that $P$ does not satisfy Peano's fifth axiom because $P\left(1^\prime\right)$ is not true.
What is it about this particular proposition which requires us to test the special case of $P\left(1^\prime\right)$?
Put differently, given the proposition
$$Q\left(x\right):=x=1\lor\text{x succeeds 1},$$
is it sufficient to show $Q\left(1\right)$ and $Q\left(n\right)\implies{Q\left(n^\prime\right)}$?
Your definition of "succeeds" says (among other things)
This is not the same as your subsequent claim
You have made the converse error.