Asset Protection: Six steps toward personal security
If you are like most people you are too busy building assets to spend much time thinking about protecting them.
Accordingly, it is essential that you take steps to protect your assets from attack. The following are 6 basic steps which every business owner should take:
- Non-business assets should be held by a company, trust or person that is not exposed to the risk of litigation emanating form your business;
- Assets such as trade marks, patents and equipment should be held by an independent company, trust or person. This also provides better tax planning opportunities;
- Inter-company loans or shareholders loans should always be secured. That way they will have priority over unsecured creditors;
- Personal wealth can be held in a Private Superannuation Fund. In most cases superannuation funds are protected from creditors;
- Ensure that you have a thorough understanding of your obligations under the terms of any contract you enter into;
- Shareholdings and Trust Deeds should be structured so that the certain rights are forfeited rights in the event of bankruptcy.
By reviewing your personal financial affairs and business structure we can advise you on the best ways for you to maximise the protection available to you under the law.
This process not only protects your assets, it can reduce the chances of litigation being commenced against you in the first place. No business can afford to be without an effective Asset Protection Strategy.
The Australian Financial Security Authority (AFSA) provides services and information related to insolvency, trustee services, and personal property securities. Visit the AFSA website here, for more reading.
