Trust & Corporate Services

Personal Asset Protection: Asset Protection Trusts and Wealth Protection Structures

High net worth individuals today face a potential multitude of risks to their wealth. Without measures in place to protect this wealth, a change in business fortunes, for example, can dissipate or decimate this wealth, thus dramatically cutting a family's standard of living. Similarly, for example, without proper advance planning, a change in marital circumstances can result in a significant division of wealth.

What is Personal Asset Protection

Personal asset protection (also known as wealth protection) aims to shield personal wealth from creditors without undermining tax and estate planning objectives and without resulting in a family's loss of control over family assets. These creditors may take the form of tax authorities, hostile spouses or children, or business counterparties. Asset protection may involve a combination of the use of asset protection trusts and corporate vehicles to hold assets as well as other legal means to insulate assets from creditor claims.

How We Can Help with Personal Asset Protection

Devising an effective personal asset protection structure requires a thorough understanding of bankruptcy and insolvency law, tax laws, matrimonial laws, laws of inheritance and succession, trust laws and company laws in the place where the assets are located, where asset holding structures are established and where family members reside. In what circumstances do these laws allow assets which have been transferred to be clawed back? In what circumstances can limitations of a holding vehicle's liability be pierced?

Timothy Loh Corporate Services has 15 years of experience in devising structures to protect assets. We work with tax and legal advisers in different jurisdictions, leveraging our experience to understand the key concerns in each of those jurisdictions and devising strategies to address those concerns. In Hong Kong, we work with our affiliated law firm, Timothy Loh LLP.

Our services include:

  • Advising on choice of holding vehicles. We advise on the use of companies and asset protection trusts to hold assets, taking into account not only wealth protection needs but also estate and tax planning considerations.

  • Advising on the proper operation of holding vehicles. We help you to ensure that limitations of liability in corporate vehicles not pierced and that asset protection trusts are not rendered unenforceable or ineffective as a result of being regarded by the courts as sham trusts or illusory trusts.

  • Advising on the use of real security, such as fixed charges or mortgages, to prioritize interests of designated family members over assets which may be at risk of creditor action.

  • Advising on the structuring of companies and asset protection trusts to ensure effective control over assets whilst achieving wealth protection objectives.

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