When your family and assets span continents, numerous considerations may arise that can threaten your succession plans. Here is a guide to help you begin your journey of building a lasting legacy.
There is a Chinese saying: “Wealth does not last beyond three generations.”
As families grow and accumulate wealth, the complexity of managing and preserving it for future generations also increases. Without a well-structured estate plan, a family’s assets may quickly erode due to disputes, legal fees and taxes, not to mention the emotional strain on those left behind.
Today, it is increasingly common for individuals and families to have a nexus to more than one location – the first generation may reside in one country, while the second generation may reside in another. As a result, family assets are often held across different jurisdictions.
While this diversity presents unique opportunities and perspectives for these families, it can also lead to additional complications relating to the transfer and preservation of wealth from one generation to the next.
In addition, wealth transfer may occur unexpectedly and before the next generation have the necessary skills to adequately manage significant wealth. Legacies may be eroded or even eradicated due to inexperience or mismanagement.
Understanding these complexities and potential threats is important for effective wealth planning.
There are four common wealth transfer concerns faced by families:
Probate is the legal process by which a deceased person’s estate is administered and distributed according to his or her will, or, if there is no will, in accordance with the provisions of the law.
When an individual passes away, the assets owned in his or her name will initially be frozen. Such assets will be subject to the probate process before they are distributed to beneficiaries. The process involves, but is not limited to, confirming the validity of the will and appointing the executor (or administrator).
Simple as it may sound, various issues may arise in the process and cause lengthy delays. These challenges could include difficulties in identifying assets, disputes regarding the validity and/or contents of the will, ownership restrictions on certain assets and the existence of forced heirship rules in certain jurisdictions – just to name a few.
Where an estate comprises assets in different countries, the probate process will need to be undertaken in each of these jurisdictions. This multijurisdictional probate could present significant challenges in the administration of a cross-border estate.
Take the example of an individual living in Hong Kong with the following assets:
When this individual passes away, assuming there is a valid will in Hong Kong, the executor of the estate will have to deal with multiple probate proceedings:
Only when these steps are completed in each respective jurisdiction can the executor make arrangements to distribute the assets. This can be a lengthy, costly and potentially complex exercise. “In the event there are disputes over the validity of the will in the first place, the process will be protracted, particularly if the case is brought to the courts,” says Vivian Kiang, managing director, head of Wealth Planning and Fiduciary Services, RBC Wealth Management in Asia.
Families seek to protect their assets for the long term and to safeguard the interests of future generations. As such, proactive estate planning is important.
Instead of navigating multijurisdictional challenges while they are grieving, families can establish clear succession structures in advance.
Comprehensive succession planning typically aims to achieve four primary objectives:
Arrange for younger generations to have access to funds to cover reasonable living expenses, educational funding and medical needs to ensure they are taken care of in the event of family contingencies.
Delay full asset control until beneficiaries demonstrate the maturity and capability to manage wealth responsibly, preventing premature dissipation of family assets. This is especially important with young beneficiaries as inheriting large amounts of wealth at one time may create more risks than benefits, due to their inexperience in managing portfolios.
Shield wealth from external threats, including:
Succession plans should be flexible enough to adapt as family circumstances evolve across generations, since family structure, geographic locations and financial needs often change over time.
For families to achieve these goals, the transfer and distribution of assets must be appropriately structured. “Not having a proper plan in place for the succession of assets is like setting sail without a compass – the family’s assets may drift into the hands of unintended parties, and beneficiaries may be steered onto the wrong path,” says Kiang.
In some jurisdictions, ownership of certain assets is restricted to citizens. For example, most residential-use land in Singapore can be owned only by Singapore citizens. If the beneficiary is not a citizen of Singapore, he or she must apply to the authorities for permission to inherit the property. If authorities deny approval, the land must be sold within a stipulated period – and the sale would be subject to the market conditions at the time.
Many second-generation individuals relocate abroad for job opportunities or lifestyle preferences. When beneficiaries reside in high-tax jurisdictions, the transfer of family assets may trigger unexpected tax consequences in those countries.
One common family scenario is when the first generation resides in the People’s Republic of China (the PRC) while their children live in Canada, a jurisdiction that has high income tax rates. Without proper planning, the wealth created by the parents may face exposure to Canadian tax rules after the assets are transferred to the children – whether through gifts or inheritance. If the child in Canada inherits all of the PRC parents’ assets upon their death, future income and/or gains earned on those assets may be subject to tax in Canada.
In addition, there are jurisdictions that may apply gift, estate or inheritance tax upon the transfer of assets in that jurisdiction.
A comprehensive estate plan is one that aims to provide clear guidance, reduce the potential for conflict, and ensure that assets are managed and distributed in accordance with the individual’s wishes, while considering the specific circumstances of the beneficiaries.
Strategic structures such as trusts, joint ownership and beneficiary designations can reduce the amount of assets subject to complex probate proceedings when estates span multiple countries.
For high-net-worth individuals and families, estate planning transcends simple wealth transfer. By addressing potential issues early, families can beat the three-generation curse and preserve their legacy and ensure financial security for generations to come.
The complexity of cross-border wealth can be daunting, but with the appropriate advice and guidance, the outcome – providing a stronger tomorrow for families – will be worth it. Individuals should start their estate-planning journey today to safeguard the wealth they have worked so hard to build.
The material herein is for informational purposes only and is not directed at, nor intended for distribution to or use by, any person or entity in any country where such distribution or use would be contrary to law or regulation or which would subject Royal Bank of Canada or its subsidiaries or constituent business units (including RBC Wealth Management) to any licensing or registration requirement within such country.
This is not intended to be either a specific offer by any Royal Bank of Canada entity to sell or provide, or a specific invitation to apply for, any particular financial account, product or service. Royal Bank of Canada does not offer accounts, products or services in jurisdictions where it is not permitted to do so, and therefore the RBC Wealth Management business is not available in all countries or markets.
The information contained herein is general in nature and is not intended, and should not be construed, as professional advice or opinion provided to the user, nor as a recommendation of any particular approach. Nothing in this material constitutes legal, accounting or tax advice and you are advised to seek independent legal, tax and accounting advice prior to acting upon anything contained in this material. Interest rates, market conditions, tax and legal rules and other important factors which will be pertinent to your circumstances are subject to change. This material does not purport to be a complete statement of the approaches or steps that may be appropriate for the user, does not take into account the user’s specific investment objectives or risk tolerance and is not intended to be an invitation to effect a securities transaction or to otherwise participate in any investment service.
To the full extent permitted by law neither RBC Wealth Management nor any of its affiliates, nor any other person, accepts any liability whatsoever for any direct or consequential loss arising from any use of this document or the information contained herein. No matter contained in this material may be reproduced or copied by any means without the prior consent of RBC Wealth Management. RBC Wealth Management is the global brand name to describe the wealth management business of the Royal Bank of Canada and its affiliates and branches, including, RBC Investment Services (Asia) Limited, Royal Bank of Canada, Hong Kong Branch, and the Royal Bank of Canada, Singapore Branch. Additional information available upon request.
Royal Bank of Canada is duly established under the Bank Act (Canada), which provides limited liability for shareholders.
® Registered trademark of Royal Bank of Canada. Used under license. RBC Wealth Management is a registered trademark of Royal Bank of Canada. Used under license. Copyright © Royal Bank of Canada 2026. All rights reserved.
We want to talk about your financial future.