Succession Lawyers

Succession Planning
Succession Planning

Succession Lawyers

When a business intersects with family dynamics and owners who are not part of the operation of the business, life can become full of obstacles.  A recent survey of family businesses stated that less than 15% of them have anything resembling a succession plan in place and that is why so few family businesses can survive the second generation let alone the third or fourth.

We are here to help you preserve your legacy!

Succession planning touches on many areas of law:

But it goes a lot further than the law.  Helping your family navigate the legal and interpersonal pitfalls is what sets us apart.  With the help of our team of business lawyers, we apply our expertise to help you put the right people in the right places when business, family, and ownership are put into play.

Succession Lawyer
Succession Lawyer

Tax and Estate Planning

What is tax and estate planning?

In its simplest terms, tax and estate planning is making sure the people and organizations get the gifts that you want them to get with as little hassle and as little tax as possible. Having the right plan makes sure that you leave more money in your family’s pocket and less in the hands of the taxing authorities. From corporate re-organizations to the introduction of family trusts, we help you put the right plan in place. Your company, trusts, and personal affairs must all be aligned. Estate planning goes a step further to include examining your liquidity to ensure a smooth transition while maximizing your wealth. Many areas of law are exploited to help:

What is a family trust?

A family trust is a legal vehicle that allows one or more individuals (or corporations) to be the trustees of property and manage it on behalf of beneficiaries who will benefit from that property.

Related Article: Power Of Attorney

What is a trustee?

A trustee manages property and often makes decisions about the distribution of it or income derived from it for the beneficiaries of a trust. They have a fiduciary responsibility. What that means is that they have a duty to act in the best interest of the beneficiaries and not in their own interest. That is a big set of responsibilities! So when choosing trustees, choose wisely.

Why use a trust?

There are many circumstances when a trust makes sense. Sometimes, it is tax-driven. Using a trust may help save taxes. Often, there is someone who is not able or trustworthy to manage property on their own behalf. For example, one family member who is due to inherit a large amount has a history of addiction and they cannot be trusted with a large sum of money. Finally, there may be other advantages to using trust. A Henson Trust is commonly used in Ontario for people who qualify for ODSP provincial disability benefits. If they were to inherit a significant sum of money, they would no longer qualify. However, a properly structured trust can be used to preserve their eligibility for these types of benefits while still funding other aspects of their lifestyle.

Succession Lawyer

Life Insurance

what is life insurance?

It is a contract that pays a lump sum of money, tax-free on the death of a Canadian resident?

Insurance comes in 2 basic varieties. Term insurance is generally purchased by younger people and it is insurance for “if you die”. It is usually purchased to cover off debt, income replacement, your mortgage and any other final expenses.

Permanent or whole life insurance is purchased for “when you die”. As long as premiums are paid, it never expires and the price is usually level. It can even be pre-paid. It is usually used to fund final tax bills, create charitable gifts, estate equalization or simply enhance the size of one’s estate.

who should own and pay for the insurance?

When doing tax and estate planning, often having one of your corporations own the insurance can further enhance the benefit because you are often using cheaper dollars to pay for the insurance, it can reduce the value of the corporation for capital gains purposes and the Income Tax Act provides a mechanism, the Capital dividend account, to move the money tax-free to the new shareholders.

Mediation and Facilitation

Our lawyers are well-trained and highly-skilled professionals. But when dealing with your family, you need something more. Our family enterprise lawyers bring years of experience working with families and in business themselves. That experience allows them to ensure the right solutions while helping you to maintain family harmony. It is our goal to help you put the plan in place that sustains relationships in the business and in the family for generations to come. Our experienced professionals will present unique solutions to achieve those goals.

Finding experienced and reputable lawyers in Toronto and lawyers in Vaughan is made easy, with Hummingbird Lawyers LLP’s two locations. Choose the location most convenient to you, and our staff are ready to assist you with your legal matters.

For questions about succession planning, please contact us by filling out the form at the bottom of the page or call us (905) 731-1911.

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    Hummingbird Lawyers strategically assists businesses and individuals in the areas of business and corporate law, commercial and residential real estate transactions, wills and estates, employment law, family and divorce, litigation, and immigration.

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