Most Accountants have a page on their website or marketing brochure telling you the type of services they offer. But how many people actually understand the jargon and what these services involve, let alone whether they need them or not? In this blog series we explain exactly what these services are and how they can benefit you.
Why would you involve your Accountant in your ‘Estate Planning’?
Estate and business succession planning is a process that requires careful consideration to a person’s whole legal and financial situation taking into account assets owned personally, owned by companies or trusts, taxation requirements and asset protection. Given the nature of the complexities it is often crucial to involve both your Accountant and Solicitor in the development of an Estate Plan. Your Accountant will have an intricate understanding of the ownership of assets, how your business operates, and the taxation implications on the distribution of money from your Estate to your beneficiaries.
Take for example Jenny who owns two properties each worth $400,000, one that she resides in and the other is an investment property. Jenny wants her Estate to be shared equally between her two children and has therefore, documented her Will to leave one property to each child. The child who inherits the property Jenny resides in will receive the property tax free if it is sold within 2 years of Jenny’s death. The child who inherits the investment property will also inherit a Capital Gains Tax liability upon sale of the property, meaning the net amount available to them after the sale of the property will be far less.
This example illustrates the importance of having both your Accountant and Solicitor working closely together to ensure the fulfilment of your legacy in accordance with your wishes. Often people’s circumstances are a lot more complex than originally thought and careful planning is required to achieve the desired end result.