The Incredible Power of Trusts
For Entrepreneurs, Property Investors, Business Owners & Wealth Creators.
In this FREE high content training video you will learn
The 5 everyday risks business owners face
The 5 absolute myths and misconceptions about trusts
The 10 Indispensable reasons why you must set up a Trust structure before you do anything else.
How you can leave a lasting legacy for your family & loved ones
In Practice the trustees do indeed control their assets, in theory they do not, this is where your TRUST STRUCTURE & TRUST ADMINISTRATION is key. (This is all done for you by Trust Focus)
By Placing your assets into a TRUST you effectively protect your assets against potential claims, creditors. (Your spouse could become your biggest creditor and day to day Business rival)
This is attained by establishing the correct TRUST STRUCTURES that will own all your assets, properties, investments & businesses that you would have owned in your personal capacity.
No Estate Duty
No Capital gains tax
No Executor’s fees
Your minors are protected
NO ESTATE FREEZING
NO COSTS ON DEATH
WILL BE SAVED ON YOUR DEATH This will be passed on to your loved ones, children and spouse.
As their wealth increase so do their subsequent risk. It should be the other way around. The more money you make the more you should be able to protect and preserve it.
should not own the shares in a Company or the members intrest in a close corporation in their own individual names, but should rather be owned by a separate business share holding TRUST.
No Estate Duty payable
No Capital gains tax
No Executors FEES
No 30 – 35% to SARS on your DEATH
A Trust never dies and can live in perpetuity (Forever)
Bullet Proof your business and wealth for generations to come.
Income and Capital generated within the trust can be distributed to the beneficiaries where they will be paying tax based on their own personal income tax rates.
If your TRUST STRUCTURE IS CREATED CORRECTLY and administered property through our tax and trust accounts, you will BENEFIT and SAVE thousands, hundreds of thousands and millions over your lifetime in taxes.
We specialize in Trust accounting and Independent Trusteeship (Every Trust should have an independent trustee.)
It’s vital that the Board of trustees happoint an unbiased, unrelated, objective independent trustee to satisfy SARS with regards to proper administration and to distringuish between the enjoyment, control and ownership of trust assets.
A strange fact is that more than 95% of clients also have their Life Cover in their private capacity (individual names). They do not enjoy any tax benefits and have very little protection (in many cases – none whatsoever). Spouses are usually nominated as the beneficiary,
No executor’s fees
Continuity
Protection
Tax Benefits
All premiums plus 6 % compound interest are deductible from the value of an estate for the calculation of Estate Duty Tax.
An “Inter Vivos” Trust is established during the lifetime of the Member. The process of registering a trust is fairly easy, but it is of utmost importance to consult an experienced trust attorney to draft the Trust Deed. The Trust Deed is the contract that dictates the relationship between the Member (the founder) and the trustees.
One of the primary advantages of a living trust is that it offers tax efficient management and control of assets after death. The growth in the estate is “pegged” and the value will increase in the trust. A trust creates a separate legal entity that owns the assets outside of the Member’s personal estate, and therefore the Trust Assets do not form part of your personal estate for the calculation of Estate Duty.
Estate Duty (20% of Estate) as the Trust will continue to persist after death.
1.2Capital Gains Tax (13,32% CGT) on growth assets.
1.3Executor Fees (at 3.99% of the Gross Estate). This is a unnecessary and avoidable tax. Executor fees are calculated on the gross value of an estate and deducted before any other expenses, therefore the executor can receive a substantial portion of your net estate.
1.4Transfer costs on immovable property (as property ownership does not transfer to anyone after death).
Bank accounts and cash reserves will not be frozen during the winding up of the estate, which can take up to 2 (two) years. A trust will ensure rapid access to capital and income after death.
Protection of Minors. In South African Law, a minor cannot be the registered owner of property, therefore the asset is liquidated and the proceeds invested in the Guardian Fund at 3% interest rate. Assets are also protected against spendthrift children, who will not be able to reduce the assets to zero.
Multi-ownership of assets. Some assets can not be divided (e.g. businesses, farms or other property). By placing these types of assets in trust, the heirs can be the beneficiaries of the income generated by the assets.
Confidentiality. A Will becomes a public document on death. A Trust does not form part of an estate, and therefore the list of assets held in a trust remain confidential.
Protection of assets against creditors. Personal liability is limited to the assets in an individual’s name. Creditors cannot access the assets in trust, unless it was set up with the intention to defraud creditors.
Financial Risk: Mortgage Bonds or Hire Purchase / Lease agreements – the majority of South Africans need to make use of these sources of finances to purchase houses or vehicles. In event of default, all assets in one’s own name are at risk of being sold in execution. In a market where interest rates are fluctuating, banks execute against bonded assets when consumers default on payments.
Business Risk A business owner (whether a sole proprietor, a member of a CC or as a shareholder in a company) is likely to have signed personal surety for loans or credit agreements to the company, or are the co-principal debtor with the company in respect of any supplier’s credit arrangements.
Personal Risk: Car accident/s, defamation in a public place, involvement in a scuffle or conflict with neighbours etc, (claims between natural persons that may arise from social interaction).
Divorce or Family Risk: Statistically, a spouse can be the largest biggest creditor. Statistically 50% of marriages end in divorce. A large portion of an estate can be awarded to the ex-spouse, as well as possible claims for maintenance.
The advantages of proper tax planning in a well-structured trust are clearly defined in the tax legislation. Even minor beneficiaries can enjoy tax-friendly distributions. “Conduit Principle”: Unlike companies or close corporations, the Trustees can decide to pay the Income Tax (40%) or CGT (26.67%) in the hands of the Trust or distribute the tax liability to the beneficiaries at their marginal rate of tax (Income Tax 18% to 40% or CGT at 16.4%), thereby paying much less tax. Income Splitting: Trustees can use the “conduit principle” and pay beneficiaries who have tax exemptions (individuals have nearly R75 000 income per year, free of tax).
A Trust is an entity that will “outwit, outplay & outlast’” an individual. It will not terminate (unless decided by the Trustees), therefore it can own properties and assets for generations, and pass the portfolio of assets to the next generation tax free. A Trust is the only vehicle which allows the accumulation of wealth and the transfer of assets from one generation to another without incurring costs and taxes. By taking action, Members can ensure their children receive all the present wealth and assets they have accumulated and to which they can still increase. The dilemma that employment, economic cycles and market conditions present can be avoided for one’s children, if they know that there is an income producing Trust providing passive income streams (primarily through property).
TrustFocus™ has pioneered a one stop Trust solution that ensures the corporate, legal, administrative and accounting aspect of an individuals structure is implemented and executed correctly through our Trusts, tax and accounting experts.
We also offer the most comprehensive & holistic property investment service for the property investors in South Africa through IGrow Wealth Investments the leading property investors club in South Africa
We offer free Trust, tax and property investment seminars.
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