High Net Worth Individuals around the world deal with and invest in many types of assets and businesses. HNWIs have people around them they want to protect or to whom they want part or all of their assets to be transferred if the worst happens.
Unfortunately, many neglect to put in place an organised structure, a proper retirement plan, and a dedicated inheritance programme to ensure the continuity of their affairs, their businesses and incomes for the next generation.
Who are HNWIs ?
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they have participations in Private Equity,
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they are holding one or more portfolios of securities,
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they are co investing with other families or investors,
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they have shares invested in different projects,
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they own several estates and assets around the world (villas, yachts, planes, etc),
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they have people they want to protect financially, such as children, partners, business associates, and/or charities.
Our innovation, Your confidence
Creatrust understands all the key issues which are important for families, UHNWIs and their relatives.
Such expertise allows to help such families to plan for retirement, and when necessary inheritance, succession, in a secure, robust and advantageous manner.
Suc structure an process ensure that the family's wealth receives the full benefits provided by Luxembourg's favourable and innovative jurisdiction and the four step "Wealth Protection Plan" has been devised to allow HNWIs, with complex wealth and assets, the assurance that everything will be taken care of.
Protect your wealth with expert planning and structuring
The incorproation of a Private Foundation is clearly a type of structure which fits perfectly with the needs of HNWIs.
A Private Foundation is a flexible entity with a legal personality to which a settlor (resident or non-resident) transfers its assets and appoints a board of directors so that they may take charge of the administration of the Foundation.
The settlor will also appoint beneficiaries (if not, a rule to determine who the beneficiaries will be is selected).
The settlor reserves all rights to modify or to amend the board of directors and the list of beneficiaries at any time.
The settlor also appoints a protector. Its role is not to manage the assets of the Foundation but to ensure that the wishes of the settlor are always u[held and the procedure of transfer to the next generation will be carefully applied in the future.
A dedicated package of services in 4 steps
The package services called the "Wealth Protection Plan" enables HNWIs to set up a secure, robust plan for retirement and/or succession.
A list of assets to be transferred to the Luxembourg Foundation is analysed by Creatrust and advice is given to the HNWI on the most appropriate structure of investment vehicles for holding such assets.
The board of directors is elected and Creatrust is appointed as the Protector of the Luxembourg Foundation.
A list of beneficiaries is drafted and details regarding how the HNWI wishes the assets to be managed, maintained, transferred and/or donated is also put in place. This Step will also include definition of the conditions under which this will happen.
A clear plan will need to be put in place to be carried out in the eventuality of death of the settlor. This will include details of where assets are situated and persons to contact as follows:
- For portfolios of securities and banking matters: the persons to contact at the bank or the wealth management firm, the verification of the mandate in place, the modification of the risk policy, and the range of investable assets which may be adapted when it is transferred to the next generation.
- For real estate: The plan will clearly define all real estate property, followed by who should live in what property, which properties are to be rented out, and the properties which should be sold (and a minimum acceptable price).
- For participations: the plan will define which participations should be sold and the target sale price; the participations which should be kept and for how long, etc.
- For co investments: the plan will define also how long each investment should be kept and under what conditions the Foundation should disinvest.
- For yachts and planes: the plan will define if such assets will be transferred to the next generation and under what conditions, or if they should be sold.
- For art collections: the plan will define the works of art and who they should be transferred to.
- The plan should also set out a procedure for future management of the art collection.
- For charities: the plan will define the charities to which the Foundation will donate and the circumstances under which donations will be made.
A complete and thorough overview plan of hand over will be put in place and, as protector of the Luxembourg Foundation, Creatust will be involved in the monitoring of the plan and all related transactions and updating required.
The Luxembourg Foundation is set up with a Notary and the Regulation (where the appointment of the beneficiaries is mentioned) is signed by the settlor. Once signed, the Foundation is live.
From here on, the protector is responsible for monitoring the board of directors' activities and will be ready to act upon the settlor's plan should the worst happen, or any of the stated eventualities.
The settlor can be appointed as Director of the Foundation; he or she can modify the list of directors and their powers, and alter the list of beneficiaries at any time. The settlor remains in full control of assets managed by the Foundation until such specified circumstances which would see the protector enact the settlor's instructions.
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