Cross-Border Wealth Transfer

Though historically overlooked, an increasing number of PPLI carriers are refocusing on the cross-border market. The use of PPLI for wealth transfer takes root in the relationship triangle.

Transborder Relationships

An estimated 10 million people now live or have lived abroad, creating a wide diaspora of families. The globalized nature of today has resulted in a transfer of wealth across not just generations but also across national borders. Cross-border wealth transfers may involve a variety of complexities ranging from inheritance laws to cultural obligations and citizenship rights, but the end goal remains the same: to ensure the secure transition of wealth from one generation to the next. Due to the complex set of interactions of differing legal parameters, cross-border tax consequences can result in huge tax and compliance costs for some transnational individuals. The above aspects have driven the desire, at times, to maintain and grow private assets in a tax-advantaged envelope in some appealing foreign locations. PPLI allows the bespoke structuring and segregation of family wealth under clearly set distribution rules and interfaces with a financial institution of trust, catering to multiple families.

The applications may be as follows:

Wealth Planning for the Family with Children A Swedish citizen is a divorced person with two children from a marriage who live and reside in Sweden, and a third child from a post-divorce relationship. She lives in Geneva with another individual. The citizen wishes to benefit not just his children in equal measures at his passing but also his deceased wife's family back in England, as his wife's half in her estate should benefit from his estate, represented by his daughter. The assets representing his daughter, however, are located in multiple countries. Jurisdictional insight is therefore fundamental when dealing with domestic estate duty laws.