Legacy Planning
Legacy Planning
Legacy is not only about money. Legacy is values, character, and memories that you share with those around you. Legacy planning is the goal of developing a strategy and plans that enable you to preserve and pass on what’s most important to your family or loved ones.
Individual
Financial Planning
- Family Protection Needs (Insurance/Investment/Debt)
- Retirement
- Charitable Giving Goals/Charitable Planning Steps
Legal & Tax
- Wills
- Power of Attorney
- Estate Planning
Corporate
Family Businesses Succession / Ownership Succession / Transition Planning
- Family businesses are the foundation of Asia’s economies and a dynamic force in the economy. The important in business succession planning is survival and continuity of company, founder legacy and reputation. “BS” will guide you through a holistic view of the financial solutions available to effectively manage risks, strengthen your business foundations and create succession plans for generations to come.
Legacy Planning – Real Case 1
Policyowner/Insured: Mr. X
Age: 80
Nationality: Japanese
Background:
- Mr. X intended to transfer USD4 million to his son (aged 50) and grandson (aged 18) after his death.
- Mr. X was worried that his son and grandson were not good at managing finances and would spend recklessly after receiving their inheritance.
- He worried that his grandson was not mature enough to manage a large death benefit.
- He wished to plan for potential inheritance tax. In Japan, the basic estate exemption is JPY30 million plus JPY6 million per statutory heir. Applicable rates range from 10% to 55%, depending on the amount allocated by statutory inheritance shares.
Japanese inheritance tax rate:
| Amount based on statutory share (JPY) | Rate | Quick deduction (JPY) |
|---|---|---|
| ≤ 10,000,000 | 10% | — |
| 10,000,001–30,000,000 | 15% | 500,000 |
| 30,000,001–50,000,000 | 20% | 2,000,000 |
| 50,000,001–100,000,000 | 30% | 7,000,000 |
| 100,000,001–200,000,000 | 40% | 17,000,000 |
| 200,000,001–300,000,000 | 45% | 27,000,000 |
| 300,000,001–600,000,000 | 50% | 42,000,000 |
| ≥ 600,000,001 | 55% | 72,000,000 |
Rates apply after allocating the taxable estate by statutory inheritance shares; this is not a direct tax on the gross estate. Source: Japan National Tax Agency
Solution: Arrange a single-premium life insurance policy.
Challenge: A higher premium due to his age and health status.
Outcome: The death benefit is paid in scheduled instalments.
The arrangement is intended to discourage reckless spending while providing long-term protection. Monthly instalments are paid until the grandson reaches the designated age, when the remaining balance is paid as a lump sum. Receiving the payout in stages can encourage the beneficiaries to manage their finances.
Objective: Transfer wealth to the next generation through instalments.
Flexible settlement options for death benefits. Tax treatment depends on applicable law and individual circumstances.
Legacy Planning – Real Case 2
Background: The client intended to transfer funds to her two nieces residing in the United States.
Challenge: US inheritance-tax considerations and source-of-funds documentation.
Outcome: Ms. Y purchased a savings policy with a single premium of USD2 million and passed away 11 months after the policy was issued. The death-benefit proceeds were paid smoothly by wire transfer to the named beneficiaries—her two nieces.
Objective: Wealth transfer and tax planning.
