Wealth Planning

Careful inheritance planning can meet the Client’s wishes and reduce the legal and tax complexities for heirs.

Life cycles are naturally part of the life of the Family and the business.

Inheritance:

• may be carefully planned by the Client;
• it may involve, for heirs and legatees, both legal and tax obligations;
• it may include “Italian” assets and rights as part of the estate or be composed of assets located in more than one jurisdiction;
• it may concern heirs and legatees who are Italian citizens resident in Italy or involve a multi-jurisdictional Family;
• it may give rise to litigation where there is no agreement between the parties.

TEMPORA Tax&Legal supports and protects the Client throughout the entire process.

A regulation-compliant Trust can be an effective tool in a multitude of cases.

It has been a few decades now since the Italian jurisdiction has acknowledged the institution of the Trust. It was originally born in Anglo-Saxon common law jurisdictions and it is an extremely malleable institution, which therefore lends itself to various uses in compliance with sector regulations. The Family Trust is often an efficient tool for the generational transition and the continuity of the Family Estate.

In Italy and in the main European markets, TEMPORA Tax&Legal supports:

• the Client who wishes to set up a Trust, in a series of instances: the choice of the governing law, the preparation of the plan of the Trust deed, the activities that precede and follow setting up a Trust, the tax obligations related to setting up a Trust and the placement of assets and rights in the Trust;
• the Trust Client or Trust BO (Settlor, Trustee, Protector or beneficiary) who requires legal or tax support throughout or at the end of the life of the Trust;
• the Trust Client or Trust BO (Settlor, Trustee, Protector or beneficiary) who needs legal or tax support in case of a pathological event.

There are many ways to structure holding and operating companies: either under Italian law or under foreign law.

Companies under Italian or foreign law, resident for tax purposes in Italy or abroad, can be useful tools for the Family Business as well as act as Family holding companies, sub-holding companies or holding companies of a Branch of the Family.

Within Italian jurisdiction, the società semplice, as per established notarial practice, is, for instance, a useful tool for the Family Estate.

Governance and the circulation of shares and quotas can be carefully planned by drafting the Social Statute/Agreement and choosing the vehicle used.

Consequent accounting and tax obligations, in each tax period, must be properly carried out.

TEMPORA Tax&Legal supports the Client:

• in structuring the company and in defining/redefining the social Statute/Agreement;
• in the circulation, against payment or free of charge, of shares and quotas of the vehicle of interest;
• with consequent accounting and tax obligations, also during the pathological phase of litigation.

Thanks to a Patto di Famiglia, with everyone’s agreement, the succession of the Family Company can be decided in advance.

Under italian jurisdiction, the Patto di Famiglia represents today the only exception to the ban on succession Agreements. The Patto di Famiglia allows the entrepreneurial Family to define in advance the allocation of the shares in the Family Company to the heirs/designated heir. With careful planning, the financial impact of the generational transition can be better managed as well.

TEMPORA Tax&Legal helps the Client plan the Patto di Famiglia and deal with the consequent tax obligations.

If used fittingly, the Private Life Insurance Policy can be a genuinely functional instrument of protection and intergenerational transmission.

Private insurance is very useful to the entrepreneurial Client and to the Client who is a member of an entrepreneurial Family: it serves to diversify, protect and organize his/her Estate and to plan its transfer to the designated beneficiaries. A life insurance contract, if well structured in relation to the peculiarities of the HNWI [High Net Worth Individual] Client and compliant with industry regulations, can meet the initial wishes and protect the designated Estate.

TEMPORA Tax&Legal, also through the help of its network of consultants and insurance brokers, aids the Client in the choice of the product and its structuring, in keeping with the peculiarities of each individual case. TEMPORA Tax&Legal provides consultancy with reference to all relevant tax obligations (tax monitoring – RW framework of the Tax Return, early redemptions, claims).

The “Rules of the Game” of the Family can be defined through a written agreement between family members.

The respective spheres of Family, Estate and Business often improperly overlap. Should the entrepreneurial Family of the first, second or third generation want to ensure that the values, the heritage, the estate and the business of the Family last over time, they would be better off defining the “rules of the game“. The Family Constitution allows for the definition of rules concerning:

• the circulation, against payment and free of charge, of the assets and rights that are part of the Family Estate;
• the entry of the Family members in the boards of directors of Family businesses. Appropriate training programs and education programs can be defined as mandatory pathways to access the management and administration of Family Companies;
• investments in new initiatives. If a Family member wishes to involve other family members and their estate in a new investment, specific rules of engagement may be envisaged;
• solidarity, when a Family member is struggling and needs the structured and qualified support of the Family.

The Family Constitution is a contract, typically qualified as a private contract, which has primarily the value of a Gentlemen Agreement and a moral agreement; however, it can also become a Shareholders Agreement and/or be merged into the statutes of Family holding companies.

Nowadays, the Third Sector is ruled by specific regulations. Therefore, careful planning helps achieve set objectives.

TEMPORA Tax&Legal also assists third sector associations, foundations and organizations. The client is helped in setting up a third sector organization, structuring the statute and managing the consequent legal and tax obligations.