Trust Service Case Study

Client Background – Mr. Suen & Ms. Suen

• Age: 43 & 41
• Occupation: Mr. Suen is a businessman with different business models. Ms. Suen is a full-time housewife with no financial planning experience
• Number of children: 2
• Assets: Cash, stocks, funds and insurance plans
• Goal: Family immigration in 2 years

Solutions

Mr. Suen’s businesses were all on track, of which he could remotely manage with just a phone. Therefore, for better education opportunities for his children, he planned to immigrate in 2 years. Although he had not yet decided his destination, he was deterred by the high Estate Duty in most of the countries, such as the USA, UK, Australia, Spain, Japan and Korea. In Canada, there was Capital Gains Tax instead of Estate Duty.

Mr. Suen was concerned that if he unfortunately passed away after immigration, his assets would be charged up to 70% for Estate Duty, which meant a drastic reduction of inheritance, or even not sufficient for living for his family. Moreover, he was worried that since Ms. Suen had no knowledge on financial planning, his family would encounter difficulties in living in the future. Therefore, Me. Suen approached us for trust services and we promptly referred his case to a professional consultant.

Our consultant listed out some suggestions for Mr. Suen. He advised that he could integrate his cash, stocks, funds and insurance plans into a trust plan with the following advantages:

1. A trust fund nominally belonged to the trustee, no countries were liable for Estate Duty.

2. Funds could be distributed flexibly to Mr. Suen’s children according to his plan. For example, a fund for 4-year college fees when his children reached 18; another fund for their house down payment when they reached 25; and when they were 30, a fund for their wedding expenses. This could efficiently ensure his successors a good quality of life.

3. A trust could strip inherited assets off from personal assets. Even when a personal business or corporation faced a crisis, personal assets would never be involved unlimitedly.

After acknowledging the suggestions from our consultant,  Mr. Suen was well aware that a trust plan could solve all his concerns for immigration. He decided to take action before he moved.