What might you need
A Will is the most important asset protection you can establish. A properly drawn-up Will provides for your family and sets out how your affairs should be managed in the event of your death.
Not having a Will can cause a lot of extra stress for those you love at a very unhappy time – and it may have unwanted and unpleasant consequences.
If you are over 18 years old you should have Will now, and you should update it whenever your family circumstances change.
By incorporating and forming a limited liability company, you may be able to limit your liability in the event of business failure. In this way other assets such as the family home, can be protected from any creditors. In addition, incidental tax advantages may also arise. Before setting up a trading entity it is crucial to talk to us about how to “ring fence” your important assets.
Company directors are often asked to personally guarantee leases, etc. So a limited liability company is not complete protection. Company directors should consider setting up a family trust separately in order to safeguard family assets.
A Family trust is a simple legal structure which can help you to protect your assets. There are a number of ways in which having a trust can protect your property, and your family. A trust will survive your own death and assist you to protect inheritances for future generations.
The best time to think about establishing a trust is now, as the process of vesting your property can take some time.
Advantages of Trusts:
• Protection from creditors
• Protecting family from possible claims under the Property (Relationships) Act
• Protection from possible future changes to capital gains or death taxes
• Reducing the threat of asset testing
• Other incidental tax benefits that may arise
Enduring Power of Attorney for Property
An Enduring Power of Attorney gives someone else the legal authority to act on your behalf to a specified extent.
You can appoint someone to act for you to protect your property if you are incapacitated or are unable to act yourself.
Enduring Power of Attorney for Personal Care and Welfare:
An Enduring Power of Attorney in relation to Personal Care and Welfare authorises your attorney to make decisions about your personal care and welfare in the event that you become mentally incapable.
Relationship Property Agreement
The Property (Relationships) Act 1976 which was amended from 1 February 2002 applies to to anyone who is married or has lived in a de facto relationship for more than three years. Couples of whatever gender living in such relationships may find that assets such as houses, cars and furniture will be split 50/50 after the end of the relationship, regardless of who paid for them.
The only way to avoid such an outcome is to have a prior legal agreement ‘contracting out” of these provisions of the law. Such an agreement must be signed by both parties.
Also known as a “living will”. If properly drawn up, an Advance Directive, prepared when you are of sound mind, tells doctors what care you wish to receive should you be incapacitated by a disease such as brain injury or advanced terminal illness
Ensuring that your life and health insurance is properly structured is important for the financial well being for you and your family. To ensure that your insurance is always relevant, all your insurance documents are in one place for easy access and review
Here’s your asset protection checklist. Have you considered the following options?
• Family Trust
• Powers of Attorney
• Advance Directive
• Relationship Property Agreement
• Company Structures
• Car, house & contents
• Mortgage Protection
• Income Protection
• Life Cover
• Medical Insurance
• Business Insurance, including key staff cover
While we do not offer insurance, Cherry Kannangara Thomson can refer you to an Insurance Broker to consult further on these options.