Introduction 

Basic Package + Medium Package +  “Moat and Castle”

Products Included    

Moat and Castle 

For your business

• Upgrade of discretionary trust to leading member discretionary trust

 – only for advanced package  

• Upgrade of trustee companies to leading member component
• Upgrade of trustee company of pre-established discretionary trust

For your super 

• Re-establishment of an account-based pension with generational reversions
• Upgrade of SMSF to leading member SMSF
  • Upgrade of trustee company of SMSF
  • SMSF Will
  • Family Allowance Agreement
  • Dependency Declaration

How they work for your benefit:  

Moat and Castle is a comprehensive and complex Succession Asset Protection and Estate Planning Strategy. It is all about building structures and setting up systems to protect and grow family wealth as well as the estates for the benefit of the bloodline descendants. This allows the clients to build their own castle and create a moat to protect the castle from invaders.   

Traditionally, the assets are placed inside the Estate. But our approach is different from the traditional one and it is far mor better. The guiding principle of the Moat and Castle is to keep as much as possible out of the Estate.  

By having the Protector, you will be able to transfer the net equity of your and your spouse’s assets into the Family Protection Trust where they are safe from death, divorce and dementia.   

Apart from the Family Protection Trust, Moat and Castle include Leading Member Discretionary Trusts to place business entities and Leading Member SMSF to place SMSF. This allows the clients to protect their business entities and SMSF, practically leaving the estate empty.  

Line of succession is very weak in most Estate Planning. But Moat and Castle has the Leading Member ingredient which provides a strong line of succession for all the structures included.  

Assets placed within your estate are unsafe from family provisions claims. A family provision claim is time consuming, and it can consume about 20% of the estate in legal fees. The longer the fight, greater the loss. Our aim is to protect our clients and enable their legacy to last longer.   

By preparing a Family Allowance Agreement, you can formally establish financial dependency of a family member. The ITAA 97 establishes financial reliance when one person gives a better quality of life to another person on a regular and ongoing basis. Many parents contribute on an as-needed basis for their adult children and the adult child’s family. Proving financial dependency is critical for tax purposes. Family Allowance Agreement formalizes true financial help being provided by a member of a family or parents to their children and grandchildren. 

What is the Family Allowance to be used by the Family for? 

The Provider, provides a regular family allowance payment as detailed below for the purposes of looking after their Family for, amongst other things the following purposes: 

► Paying for school fees 

► Buying clothes for all the Family 

► Providing funds for acquisition of food and services 

► Providing funds for any other purpose to enhance the life, experience and comfort level of all members of the Family. 

At the time of death, if a beneficiary of the deceased member was a dependent as defined in the Income Tax Assessment Act 1997, they may take a lump sum payment tax free. Preparing a Dependency Declaration for Superannuation and income tax purposes, allows an SMSF Member to make a declaration in relation to financial dependents. If your beneficiary is a dependent as defined in the Income Tax Assessment Act 1997 at the time of your passing, they may receive a lump sum payment tax free. Without evidence to prove themselves as dependents, they will not receive these tax benefits.  

If you have a Self-Managed Super Fund, SMSF Will is a perfect fit for you. The SMSF Will provides a set of instructions, in a similar fashion to a Will (but for superannuation benefits in a SMSF only) that provides more than six different options and conditions; including the Fund’s adviser, specific bequests, pensions and SMSF Death Benefit Trusts.   

For your business,

Sole Director companies are not immune to death, divorce, incapacitation of the director. By preparing the successor director solution, upgrade your company constitution and a Successor Director may be inserted as a director in the event of a director due to divorce, is incapacitated, dies or is otherwise unable to carry out their duties as a director with a smooth transitioning.

What is involved?  

A traditional Discretionary Trust is weak due to absence of this key component. But our Leading Member Discretionary Trusts are perfect for your business entities as they provide the leading member provision as well as the Successor Director Solution inbuilt along with it thus making sure, who would be in control of the Trust when the current director is dead or incapacitated.    

Tighter the line of succession, stronger the premise.  

The best way to run a SMSF is simply to have a Sole Director Trustee Company i.e. Special Purpose Leading Member Trustee Company. It makes the chain of command in that SMSF a lot stronger. And it is easier for accountants and administrators as they are only required to work with the director.