Business Wealth Transfer

Successful incorporated small business owners will accumulate wealth inside their business. Strategies to effectively grow this wealth and then unlock it for income, retirement funding or intergenerational wealth transfer are important. Insurance strategies are most often used to achieve these goals.

Often, as business owners accumulate wealth in their business, they will invest assets not required to support the ongoing business into investments such as term deposits, GICs and mutual funds. A HOLDCO corporate structure is often used. Unfortunately, any investment return is taxed at the top corporate tax rate. Alternatively, if the corporation has needs for key person, loan protection or buy/sell insurance, these same insurance policies can be used to invest and grow these assets on a tax deferred basis. The accumulated investment value can be used to support income or retirement needs or, at the time of the owner's death, the investment value and policy death benefit, for the most part, can be passed through the Company's Capital Dividend Account, tax free to the owner's heirs.

At Transitions Wealth Strategies, our mandate is to educate the small business owner so that they fully understand the available insurance strategies and how they can be applied to their personal business situation. Our guidance shows them how their business wealth can be enhanced and then unlocked to meet their desired goals.

As with all insurance strategies, we encourage business owners to plan and act now. It is important that this planning be addressed when they are in good health and insurable.

Previous Page Top Of Page