Family Office & Family Trust Presentation 2 November 2017 Tan Woon Hum Partner Head of Trust, Asset & Wealth Management
Introduction Shook Lin & Bok LLP is one of the leading and full service law firms in Singapore with a strong Asian presence and global reach. We have close to a century of rich legal heritage with a number of partners who are eminent lawyers in their respective areas of expertise. We believe that our success lies in our team of well-trained and experienced lawyers who are innovative and effective in solving complex and difficult legal issues, and who are able to provide customised and value-added legal services to our clients. Over the years, we have built a strong base of clients comprising both local and international financial institutions, as well as large multinational corporations. 2
Family Office Structures Private Investment Holding Company Family Office Private Trust Single Investor Fund 3
Private Investment Holding Company Shareholders Private Company Directors Management Staff Subsidiaries, Investments & Assets (shares, bonds, cash, properties etc.) 4
Family Office Shareholders Business ownership Passive investment Investment management Asset holding Succession planning Tax planning Training for next generation Philanthropy Insurance Healthcare Education Family Office Private Company Family Assembly (all adult family members) Family Council (key decision makers) Family Governance/Charter (rules) Directors, Management, Investment Professionals, Legal & Tax Advisers Staff Subsidiaries, Investments & Assets (shares, bonds, cash, properties etc.) 5
Private Trust Beneficiaries Beneficiaries receive distributions from the Trustee according to the terms of the trust deed Settlor Settlor establishes the trust, injects assets into the trust, gives instructions to the Trustee in the trust deed The Trust (Trustee) Protector Protector has limited special powers as set out in the trust deed Trustee owns the assets of the Trust on behalf of the trust/beneficiaries, carries out instructions of the Settlor set out in the trust deed Trust Assets 6
Single Investor Fund Investor Fund Management Company Private Fund (Company, Limited Partnership or Unit Trust) Directors Investments (shares, bonds, immovable properties) 7
Basic Concepts of Private Trusts No separate legal entity Requires a trustee owns all assets, enters into all contracts, sue & be sued Legal duties of trustee under Trustees Act & common law onerous & fiduciary in nature Legal transfer of title Normally taxed as a corporate entity Specify beneficiaries or class of beneficiaries Scope of trust powers & investment powers Created during lifetime of settlor Types public-listed investment trusts & private family or charitable trusts 8
Basic Concepts of Private Trusts Express trust clear intention & trust deed 3 key requirements certainty of intention to create the trust, of subject matter & of beneficiaries Income & capital can be distributed to beneficiaries Flexibility in entitlements within the trust Revocability can be revocable or irrevocable Powers of retention settlor can retain limited powers Concept of protector The law looks at substance over form 9
Reasons for Singapore as a Choice Jurisdiction Low corporate & personal income tax No capital gains tax No estate duty No forced heirship Reputable international financial centre Growing wealth management hub Established & clear legislation Independent & efficient judiciary Tax-free Singapore foreign private trust 10
Disclaimer: This information is provided for general information purposes only and does not constitute legal or other professional advice. It is not comprehensive. Specific advice should always be sought in relation to any legal issue. Shook Lin & Bok LLP does not accept any responsibility for any loss which may arise from reliance on the above presentation. 11
Questions? 12
Thank You Tan Woon Hum Partner Head of Trust, Asset & Wealth Management T: +65 6439 4898 E: woonhum.tan@shooklin.com 1 Robinson Road #18-00 AIA Tower Singapore 048542 Tel: +65 6535 1944 Fax: +65 6535 8577 E-mail: slb@shooklin.com Website: www.shooklin.com 13