If you are expecting an inheritance
from a relative living abroad outside of Canada, stay tune for this video to find out how you
may eliminate your Canadian taxes on any future income to be generated from your foreign inheritance. If you are expecting an inheritance, the good news is you will not have to pay Canadian taxes on the inheritance, regardless of whether the inheritance is to be received from a relative living in Canada or overseas. However, you will have to pay Canadian taxes on any future income to be generated from your inheritance. If the relative from whom you are expecting
the inheritance is living abroad outside of Canada, there is a perfect legal way to avoid the Canadian taxes on any future income to be generated from your foreign inheritance. But this tax plan needs to be initiated and implemented before the death of this overseas relative. The general idea of this tax plan is for your
overseas relative to bequest your inheritance into an offshore trust. This offshore trust will be formed in a zero tax jurisdiction upon the death of this overseas relative.
You will be the sole beneficiary to receive any income or capital distributions from this
offshore trust. As long as this offshore trust is properly managed in the zero tax jurisdiction,
no income tax would have to be paid on any future income to be generated from your foreign inheritance which is to be owned indirectly through this offshore trust. This tax planning technique is generally referred to as an “inheritance trust” or a “granny trust”. Again, for this tax plan to work, the planning process needs to be initiated and implemented before the death of the person from whom you are expecting the inheritance. Thank you for watching. I am Claudia Ku, your trusted accountant. I hope you find the information useful. Share the video with your friends and family if you think they can use the information. And don’t forget to subscribe my channel to watch my upcoming videos. And click on the link to my website to subscribe our free email service of TaxTips. See you in the next video.