Solutions for Private Clients with US Connections
New Strategies for a New Era
The global importance of the US dollar , US securities and
other financial assets makes them a part of almost everyone's financial strategy in some way.
Avoid Unpleasant Surprises
Well-diversified investment portfolios inevitably contain US equities or funds and many investors also own US real estate. Investors focus considerable attention on trying to maximize the value of their portfolio but are often unaware of the potential effects of US taxation on plans to pass assets on to future generations. US income or estate taxes can apply to foreign nationals who have no, or limited residential ties to the US. Consider the following examples:
- An individual who has never lived in the US owning a portfolio of stocks that includes a number of US issued securities. On the death of the investor these assets are generally subject to US estate tax at rates of up to 55%.
- A non-US person travels to the US from time to time, has a vacation home there and spends more than 121 days a year in the US. This individual is subject to US income tax on his worldwide income.
Changing legislation also can have important implications for settlors whose tax and estate plans have not been kept up to date with evolving tax laws.
The only way to avoid unpleasant surprises is to examine your financial arrangements and identify any real or potential US tax liabilities. These can then be addressed with new structures that reduce or remove US tax exposure.
The US Private Wealth Group
A unique response to the changing world.
Strategies for New Circumstances
The expanding influence of US tax laws and legislative changes in other countries are combining to alter the world of offshore financial services. Royal Bank of Canada's Global Private Banking specialists have developed a unique way to meet the challenge of these new circumstances. Working with your advisors, the US Private Wealth Group specifically provides wealthy individuals and families with ways to preserve their assets using US tax-compliant structures.
Many of these structures include international trusts designed to guard the interests of non-US citizens or residents who have US assets, income, or other connections, such as US-resident relatives. Other structures are designed for US citizens to facilitate estate planning or legal protection of earned or inherited assets and to obtain various kinds of tax deferrals, reductions or exemptions.
The Group's US tax and trust professionals provide an integrated tax and trust service. We will work with your advisors from initial analysis and recommendations through to implementation of an appropriate structure. The Group liaises with other professionals to provide continuing US tax-enhanced administrative services for such structures that need them, including:
- completing and filing forms to avoid excise tax penalties,
- tracking income according to IRS rules,
- tracking gains and losses according to IRS rules, and
- monitoring distributions for optimum tax efficiencies.
How to Minimize Liabilities
Many wealthy individuals are simply unaware of their exposure to US taxation, or the many ways unexpected tax liabilities can disrupt their financial plans. To obtain protection against such exposures, it is necessary to consider not only the existing position, but also potential problems that may arise in the foreseeable future. We can assist in structuring your financial arrangements should you:
- plan to or have purchased your own US equities or real estate assets,
- acquire or own a company doing business in the US, or with US companies,
- hold a US passport or green card, or are married to a holder of either,
- have children in US schools, or heirs living in the US,
- plan to move to the US eventually, or
- visit the US for more than a few weeks a year.
An initial, exploratory meeting with our staff is the first step in designing an appropriate tax efficient structure. This meeting identifies current requirements, long-term goals and potential liabilities. Based on this meeting we will draft a proposal that outlines various structural options, which we will discuss further with yourself and your advisors. Once a solution has been selected and approved, we proceed to implement the structure, and administer it for a pre-established annual fee. We also continuously monitor the structure, and indicate potential problems due to legislative changes or changes in personal circumstance to maintain tax compliance.
Royal Bank of Canada Global Private Banking is an integrated global financial services resource. We presently serve individuals and corporations from over 150 different countries. There are 25 Global Private Banking offices linked in a network that extends through every major economic region and international centre.
The US Private Wealth Group
The US Private Wealth Group is Royal Bank of Canada Global Private Banking's unique, evolutionary response to the changing world of offshore financial services. To give your wealth the fullest available protection in this new era, please contact the US Private Wealth Group.
Head of US Private Wealth Group
Royal Bank of Canada Trust Company (International) Limited.
P. O. Box 621, Le Gallais Chambers
54 Bath Street, St Helier, Jersey JE4 8YD
Tel: +44( 0) 1534 501000 Fax: +44( 0) 1534 723265
email: trust_ intl@rbc.com
Head of US Private Wealth Group
Royal Bank of Canada Trust Company (Bahamas) Limited.
Royal Bank House, East Hill Street
P. O. Box N-3024, Nassau, New Providence, Bahamas
Tel: (242) 356-8552 Fax: (242) 323-3407
email: gpb.bahamas@rbc.com
This publication has been issued by Royal Bank of Canada Trust Company (International) Limited and Royal Bank of Canada Trust Company (Bahamas) Limited. Royal Bank of Canada Trust Company (International) Limited has applied to be registered by the Jersey Financial Services Commission for carrying on trust company business. Potential clients should note that in some or all respects the regulatory regimes in Jersey and The Bahamas, including any compensation or investor protection arrangements, may be different from those of their own jurisdiction and that certain products and services described or advertised in this brochure may not be available to residents of certain jurisdictions, depending upon regulatory constraints.
The information is believed to be accurate at the time of writing but is subject to change. Please contact us to make sure that you have the most current information.
®Registered trademark of Royal Bank of Canada, used under license.
World - Class Credentials
Royal Bank of Canada is Canada's largest financial services enterprise
- It is one of the world's largest banks, providing a wide range of corporate and personal
financial services
- The Group has over C$1,147 trillion assets under administration, including assets held
in custody and subject to fiduciary services
- Global Private Banking constitutes some C$ 94 billion of this total
- Global Private Banking has offices in the key financial centres of the world and clients in
over 150 countries
- Subject to local regulations, Global Private Banking services are offered through affiliates
or subsidiaries of Royal Bank of Canada in certain jurisdictions.
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