FOR FINANCIAL ADVISERS ONLY
FOR FINANCIAL ADVISERS ONLY
Consumer
Share

Case studies

Case study 1 – David wants to leave some of his wealth to distant relatives

David is concerned that the forced heirship rules will apply to his personal assets on his death. He is keen to leave some of his wealth to distant relatives, with whom he has a very close relationship. David invests $1,500,000 into the Collective Investment Bond is subject to a discretionary trust. His distant relatives are all included in the trust as beneficiaries. The policy and the trust are governed by Isle of Man law which recognises an individual’s right to create a trust, even though David’s country of domicile may not. 

David understands that the role of a trustee carries a significant responsibility and managing and administering the trust could be a challenge for him. Due to the complex nature of the law governing trusts, the duties of trustees and what is required for the trust to be run correctly, David appoints the Old Mutual International Trust Company. This provides him with the comfort that the trust will be managed impartially. In addition, Old Mutual International Trust Company will keep up-to-date with any changes to the law governing trusts in the Isle of Man.

Case Study 2 – Mike wants protection of his business finances in the future

Mike owns an Old Mutual International Isle of Man Collective Investment Bond and would like to ensure that it is protected should something go wrong with his business finances in the future. Mike considers assigning his policy into trust and appointing Old Mutual International Trust Company as the trustees because he has heard that if his assets were held within an Isle of Man trust structure, the legal ownership of those assets would be transferred from his ownership to that of the trustees. Therefore, the assets would no longer be considered Mike’s personal assets. This would still be the case even if Mike was a potential beneficiary under the trust. However, it is important to note that in any jurisdiction, it is unlikely that a trust would be valid if its sole purpose was to avoid payment to creditors for known debts.

Financial Adviser Verification

The content of this site is for advisers only. It is not for the use of Hong Kong advisers. You can change the regional content by selecting a region from the drop down box in the top right-hand corner.