Corporate Estate Transfer / Corporate Bond / Capital Dividend Account (CDA)
Corporate Estate Transfer / Corporate Bond / Capital Dividend Account (CDA)
- Client Profile:
- Shareholder of a CCPC (OpCo and/or HoldCo)
- Surplus assets within the corporation
- Shares to be bequeathed to heirs
- Passive income within the corporation that is subject to high corporate tax rates
- Perhaps joint-life, where one of the insured’s is rateable or uninsurable
- Solution Opportunity
- Utilize accumulated corporate surpluses and/or cash flow to fund corp-owned, corp-beneficiary UL, funded as quickly as possible.
- At death, funds are paid out to corp, with the bulk of same (death benefit less ACB) creating CDA room, which may in turn be flowed out of corporation.
- On JLTD, fund value paid-out at 1st death, and deductions to 1st death, for added flexibility.