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What’s your wealth transfer strategy?

Greg Limb of KPMG asks what must private clients consider as they transfer their wealth to the next generation and to philanthropic causes?
Greg Limb, Partner, UK and Global Head of Family Office and Private Client at KPMG

As the world becomes more complex, so do the financial and fiscal needs of high net-worth individuals.

Looking at the year ahead, I see our private clients needing help with an expanding range of issues – beyond the usual tax planning, advice and returns we’re on hand to help with. In today’s globalised world, they and their families have an increasingly international footprint. At the same time, the global tax environment is becoming more tightly regulated – and more complicated as a result.

In addition, many high net-worth individuals are among the generations now driving the Great Wealth Transition. And some may want to dedicate a proportion of their wealth to philanthropic causes.

Added to all of this, of course, we all live in an uncertain and unpredictable economic and geopolitical climate. These factors look likely to present private clients with some thorny issues to unpick.

Passing it on
The much-heralded Great Wealth Transfer is now becoming a reality, as older generations of wealth creators reach retirement. According to Forbes, the Baby Boomers and their elders (known as the Silent Generation) are set to pass on as much as $68 trillion.

Indeed, we’re seeing many clients from among those generations think seriously about how to transfer their assets.

Whatever your intentions, you’ll need financial, fiscal and legal support to make your will; establish the necessary financial and governance structures; manage the tax implications; and avoid double taxation on overseas arrangements.

Given the changing tax landscape, this requires a forward-looking perspective on tax policy here in the UK and overseas.

Giving it away
In a climate of far-reaching change, high-net worth individuals’ attitudes to philanthropy are also evolving.

Alongside the Great Wealth Transfer generations, we’re seeing a new wave of younger philanthropists emerging. Many are adopting innovative approaches to supporting the causes they care about.

Whatever your motives and attitude to giving, you’ll need to think about the right time to start creating your legacy. And you’ll need an advisor who understands what you want to achieve; how to establish the right charitable entities and governance frameworks; and how to put your wealth to work in a tax-efficient manner.

Thinking it through
In a fast-moving and ever more complex world, it’s never too soon to start thinking about your legacy.

The process of planning your wealth transfer should begin by asking yourself the following questions:

- What is your strategy for managing your wealth and financial affairs, now and in the future?

- How will you transfer your money – and when? What causes are you and your family passionate about? How do you plan to support them?

- How can the arrangements you opt for take advantage of the UK’s relatively passive capital regime?

As you consider these, you might like to drop us a line. Our team provides a single point of advice and technical support for all your financial, fiscal and legal requirements. We’ll help you to identify, and put in place, the right set-up for you and your family.

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