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.
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