investing in your small business success

Investing in your small business success

Agenda

Protecting your business

Banking outside the box

Investing in the future

Protecting your business

The problems you face

Day-to-day managing

Long-term viability

Liability protection

Managing risk

Your challenges

Investment and retirement planning

Succession planning

Loss of owner/key person

Attracting/retaining employees

Income taxes and tax liabilities

Creditor and Liability Protection

Business investment income taxes

Innovative banking solutions

Your business – your legacy

Plan a successful succession

Protect your interests

Anticipate future needs

Valuation

Tax Liabilities

Capital Gains Exemption

Estate Freeze

Buy/Sell Funding

Life Insurance

Can your business survive without you?

Sole Owner

Sufficient funds to carry on

Succession planning protects your heirs

Your expectations can be met

Can your business survive without you?

Multiple owners

Death or disability stresses the partnership

Who steps in to act for the deceased?

Chances for a good outcome are poor

Advance planning averts catastrophe

Buy/sell agreements

Buy-out options

Proper funding

Business as usual

Orderly dissolution plan

Life insured investments

Life insurance

Death

Disability

Retirement

Disagreement

How much is it worth?

Adjusted balance-sheet or asset book value

Asset replacement value

Comparison

Pulling the trigger on tax

Tax is triggered by

Sale of the business

A ‘deemed disposition’

Capital gains tax

Change of use

Transfer

Emigration

Death

Asset exchange

Assets pay debts

Transfer to trust

Succession strategies you can use

Use your $500,000 lifetime capital gains exemption*

Consider an estate freeze*

Life insurance or life-insured investments

*Applies to incorporated companies only

Buy/Sell Funding

Shareholders’ agreement

Changes in ownership create financial obligations

Life insurance death benefits funds:

buy-out

tax implications

Buy/Sell Funding

Corporate owned policy*

Lower aggregate premiums

Easier cost allocation

Ensure that premiums are paid

*Concerns about creditor protection, tax consequences and effects of provincial family legislation must be addressed to determine the best approach for your circumstances

Buy/Sell Funding

Individually owned policy*

Paid for with after-tax dollars

Expensive

Confusing

*Concerns about creditor protection, tax consequences and effects of provincial family legislation must be addressed to determine the best approach for your circumstances

Collateral insurance coverage

Tax deductible business expense

Tailored to fit your needs

What impact will the loss of a key person have on your business?

Business is disrupted

Sales decline

Employees’ security is threatened

Creditors become alarmed

Deliverables in doubt

Attract and retain good employees

Financial compensation

Business environment

Life and living benefits insurance

Creditor Protection Strategy

Protect your personal assets

Investments with insurance benefits

Growth from investment

Personally guaranteed debts

Wages and vacation pay to employees

Source deductions owed to Canada Revenue

GST and PST

Health and safety violations

Environmental damage

Strategies for protecting personal assets

Incorporation Spouse’s name Business liability insurance Invest in products that offer creditor protection Hold life insurance contracts personally Professional tax and legal advice Establish a plan while the business is healthy

Banking outsidethe box

Banking outside the box

Highest return on investments

Unique alternatives to borrowing

Innovative products

Simply financing needs

Manulife Bank

Innovation, flexibility, outstanding rates

Business Advantage Account

GICs

Custom investment loans

Flexible, low cost financing

Access Line of Credit Plus

Manulife one Account

Manulife Bank

Investing in the future

Working toward retirement

Retained earnings

Business investment income

Individual Pension Plan

Segregated Funds

Life insurance

GICs and GICs. What’s in a name?

Guaranteed Investment Certificates

Bank

Guaranteed Interest Contracts

Insurance company

Designate beneficiary

Creditor protection

Probate fees and settlement delays avoided

GICs. Security for your portfolio.

Solid foundation for your portfolio

Positive rate of return

Peace of mind

Broad range of investment choices

Segregated Funds

Investment with insurance guarantees

Creditor protection

Protects your beneficiaries

Tax advantages

Benefits for long-term investing

You’ve got leverage

Borrow money to earn money

Interest is tax-deductible

Benefit from compounding

Good potential, higher risk

Business investment income taxes

Option: Invest surplus in GICs and CSBs

CSBs and GICs taxed at top corporate rate

Option: Use surplus to buy life insurance

Tax-deferred growth of the surplus

Tax-free death benefit

Small Business Solutions Recap

Loss of owner/key person

Retirement

Tax liabilities

Succession planning

Creditor protection

Capital Growth

Life-insured investments

Life insurance

Buy/Sell funding

Leveraged investing

Pension plan/IPP

Collateral insurance

Small Business Solutions Recap

Loss of owner/key person

Retirement

Tax liabilities

Succession planning

Creditor protection

Capital Growth

Life-insured investments

Life insurance

Buy/Sell funding

Leveraged investing

Pension plan/IPP

Collateral insurance

Small Business Solutions Recap

Loss of owner/key person

Retirement

Tax liabilities

Succession planning

Creditor protection

Capital Growth

Life-insured Investments

Life insurance

Buy/Sell funding

Leveraged investing

Pension plan/IPP

Collateral insurance

Small Business Solutions Recap

Loss of owner/key person

Retirement

Tax liabilities

Succession planning

Creditor protection

Capital Growth

Life-insured Investments

Life insurance

Buy/Sell funding

Leveraged investing

Pension plan/IPP

Collateral insurance

Small Business Solutions Recap

Loss of owner/key person

Retirement

Tax liabilities

Succession planning

Creditor protection

Capital Growth

Life-Insured Investments

Life Insurance

Buy/Sell funding

Leveraged investing

Pension plan/IPP

Collateral insurance

Small Business Solutions Recap

Loss of owner/key person

Retirement

Tax liabilities

Succession planning

Creditor protection

Capital Growth

Life-Insured Investments

Life Insurance

Buy/Sell funding

Leveraged investing

Pension plan/IPP

Collateral insurance

Solutions for Small Business

Investing

Banking

Insurance

Manulife Investments

Solutions for today

Solutions for tomorrow

Thank you