Estate planning: recent developments

Over the last few months, we have regularly reported on the important changes in estate planning and inheritance planning. Below is an update of some of those changes.  

The care proxy: secure your estate for later
The classic example is a person who, due to a physical or mental limitation (e.g. coma, dementia), is – temporarily or permanently – unable to manage their assets properly. The question then arises who is authorised to manage that person’s estate – the spouse or partner, children, a trusted representative? In the past, one required the intervention of a justice of the peace who would then appoint an administrator to manage the estate of the incapacitated person.

A law introduced some years ago created the possibility of making legally enforceable arrangements that enter into force the moment one loses the ability to manage one’s own estate properly. In principle, court intervention can thus be avoided. The related arrangements are included in an agent contract (the care proxy) in which the future legally incompetent person (the mandator) appoints one or more future trusted representatives (agents).

The care proxy offers plenty of freedom when it comes to what it can contain. For instance, it may cover both movable and immovable goods. The mandator then decides whether or not the agent is authorised to perform acts of disposition, such as selling property or – very important – making donations. Furthermore, in choosing an agent, the mandator is not restricted to their own (close) relatives, but instead may appoint third parties also. Appointing agents and, specifically, the (limitations of) their authorities is tailored to specific needs and conditions; the succession of the agents must also be established accurately. 

A care proxy is a very useful instrument for estate management. It allows the mandator to remain in control, yet arrange at an early stage by whom and how their assets will be managed if ever they should lose decisional competence. In addition, the care proxy offers interesting opportunities for (further) estate and inheritance planning, in particular thanks to the option of donations. Since no court intervention is required, it guarantees the desired discretion as well as the certainty that the estate is managed in accordance with the wishes of the incapable person.

Consequences of the annulment of the position of the Flemish Tax Authorities regarding split acquisition/split registration of bare ownership and usufruct
As we reported earlier, the Council of State recently quashed the position of VLABEL (the Flemish Tax Authorities) on split acquisitions, which was later broadened to include split registration of bare ownership and usufruct. VLABEL’s position necessitated families to adjust their planning if they had contributed a securities or shares portfolio into a civil-law partnership, the shares of which had been donated under reservation of usufruct. An often-used technique was to exchange the usufruct against an (either or not optional) annuity. That way, the recipient of the donation acquired full ownership of the shares, while respecting the annuity for the benefit of the donor at the latter’s request.

The technique was usually applied for practical reasons, without truly confirming the underlying wishes and objectives of the parties. The judgement of the Council of State now offers the option to review this planning technique. Through private deed the usufruct may be reacquired by the donor, thus eliminating the need to hold on to the (either or not optional) annuity.

If you are in a situation where the usufruct of donated shares has been converted in the past, please don’t hesitate to contact us to help you undo the exchange and restore the initial situation.

The requirement to register gets a broader scope
More entrepreneurs must register with the Crossroads Bank for Enterprises (CBE)
Under the aim of creating a more attractive business climate, changes were made to the existing company law. In that context, the legislator has done away with the ‘trader’ concept, replacing it with the umbrella term ‘enterprise. Besides forming the basis for the rules of the Code of Economic Law, the Judicial Code and the Civil Code, the new enterprise concept also has consequences for reg
More specific: matrimonial property law
A new compensation obligation in the legal system
What if a spouse practices his profession in a company whose shares all form part of his separate property? The Act of 22 July 2018 has introduced considerable changes to matrimonial property law. This article addresses a specific addition to that law, namely the possible disadvantage incurred by the matrimonial property when a spouse practices their profession through their own company1. 
Happy Brexmas?
How to prepare your company for Brexit?
On 10 December 2018, the British Prime Minister decided to postpone the vote on the Brexit deal in the House of Commons. The risk of a ‘no deal’ disaster scenario is increasing. What are the important dates? On 29 March 2017, the United Kingdom formally informed the European Council of its intention to leave the EU (according to the procedure provided in Article 50 of the Lisbon Treaty). C
A popular control structure
The all-powerful manager of a civil-law partnership: was it always a fiction?
The civil-law partnership has long been a popular control structure among wealth planners. In many cases, donors do not want to give up their assets entirely, and still want to retain some control over what they donate. Definitely in cases of transfers of family companies, the donors (often parents or family members) still want to retain control over the course of the business.  The advant
The tax framework
Company subsidies: exempted or not?
Various subsidies were briefly described in the article by our colleagues from Strategy and Operations. They explained that they can assist you and your company with guidance on subsidies, from A to Z.1 In this context, we would like to discuss the tax framework for subsidies: how are awarded subsidies treated tax-wise within companies? Are these subsidies exempt from corporation tax and, if
Right to deduct VAT possible for costs incurred during the purchase of shares
The Ryanair ruling
Right to deduct VAT also possible for costs incurred during the purchase of shares, if the purchase ultimately does not (fully) go ahead The European Court of Justice recently confirmed that VAT on costs incurred during the purchase of shares may be deductible even if the purchase ultimately does not (fully) go ahead. As such, the Court of Justice has upheld the principle that the preparatory t
What are the options?
The deduction for investment: an illustration of the options
The deduction for investment allows companies and natural persons who earn profits or benefits to reduce their taxable profits by placing part of the acquisition or investment value of investments in new tangible and intangible fixed assets. Depending on the size of your business and the nature of your activities, you can generally apply the regular, one-off deduction for investment of 20% (tem
Valuation of usufruct
Now also a witch hunt when usufruct is sold?
In previous editions, we have already written about the valuation of usufruct when purchasing property, but recently there have also been regular reports of checks on the valuation of usufruct when reselling. However, up until now, the case law has followed the viewpoint of the taxpayer. Brief description For several years, there has been a lot of controversy regarding the valuation of usufruc
Vlabel is using conciliatory language
Has the decrease in Flemish sales duty led to an increase in the costs for purchases of usufruct?
The decrease in sales duty: also for split purchase usufruct-bare ownership The recent drop in the rate (to 7.00%) for purchases of family homes comes with a number of conditions. For example, the purchaser must be a natural person. Following some uncertainty, it was subsequently confirmed that, in the event of a split purchase of such a property by a company for the usufruct and the bare owner f
The labour market of the future
Earn (on the side) flexibly and untaxed
There are three legal social statuses in Belgium, (i) employee, (ii) self-employed and (iii) civil servant. However, the question is often asked whether these classifications are still relevant to the rapidly evolving labour market in which flexibility is key and many people opt for a 'freelance status' or wish to combine several statuses. Voka has already called for a debate on the labour mark

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