Cross-border families are the norm now. Cross-border estates are still treated like the exception.

We’re going to talk about a real case study from an FTR client: a Canadian and Australian husband and wife in their mid-60s, who made the bulk of their money in Canada & the US before exiting, with three adult children roaming the world.

Parents are now retired and living half the year in Colombia, travelling the other half. One child in Vancouver, another in Paris, a third in Melbourne. Assets scattered across Canadian RRSPs, Australian super & real estate, Colombian real estate, and a Panamanian investment structure.

When the parent dies, each country's succession rules fire simultaneously. Without planning, the result is years of parallel probate proceedings, contradictory rulings, multiple tax bills, and often a large chunk of the estate eaten by legal and tax friction.

With planning, most of this can be, and has been, avoided. In fact, FTR’s modelling shows this family would have around USD$890,000 net tax savings (on their portfolio of ~USD$3.6million) compared to the structuring they had when they came to us, if they were to pass in the next year. That’s a significant amount of money going to their children instead of to various governments due to poor planning.

Here's the framework for how you should approach it…

First: Start With Where the Parent Lives

The parent's country of residence at death is the dominant driver.

If they died a Colombian resident, Colombian succession law applies to Colombian assets and often to worldwide personal assets. Colombian ganancia ocasional (15%) taxes inheritance received by heirs.

If they died a Panamanian resident, Panama's rules apply, which are much more permissive — Panama doesn't have inheritance tax as such and doesn't apply forced heirship to worldwide assets held by Panama residents.

Choosing where to be resident at the point of eventual death is a legitimate long-term structuring decision.

Second: Consider Where the Kids Live

Each child's country of residence determines how they're taxed on receipt of the inheritance.

• Canada: no inheritance tax on the child's side. What they receive is their own asset going forward.

• Australia: same — no inheritance tax as such, though the assets carry their acquired cost base for eventual CGT.

• UK: no inheritance tax on the recipient; the tax (if any) is on the deceased's estate.

• Colombia: ganancia ocasional at 15% on the child's side, above small exemptions.

• US: no federal inheritance tax on the recipient, but the deceased's US estate may have exposure if they held US-situs assets (up to 40% above USD 60,000 for non-US persons; USD 13M for US persons).

An estate with beneficiaries in multiple countries has to work out these overlapping treatments simultaneously.

Third: Where the Assets Sit

Each asset's location generates its own tax and legal claim.

• Canadian real estate: Canadian probate, Canadian tax on the deemed disposition on death.

• Australian real estate: Australian probate, CGT on eventual sale by heirs.

• Colombian real estate: Colombian succession proceeding (sucesión), ganancia ocasional on the receiving heirs.

• US shares held personally: US estate tax exposure, US probate, US brokerage transfer.

• Panamanian entities holding investment assets: neither Panamanian probate (foundation avoids it) nor Colombian succession (foundation is outside the estate).

You can see why the Panamanian foundation becomes the cleanest place to consolidate wealth for cross-border estate purposes.

Fourth: Consider one of FTR’s Standard Cross-Border Estate Setups

In the case study for the Australian-Canadian couple, they utilised FTR’s coordinated services to setup:

• A Panamanian foundation holding the investment portfolio, with named beneficiaries (each child and any specific gifts).

• A Panamanian SA under the foundation for banking and portfolio management.

• A Cayman Islands Trust and BVIs holding company for certain US-based securities.

• Personal Colombian and Panamanian real estate held directly (or via SA if valuable), with clear disposition instructions in a Colombian will covering local assets.

• Retirement accounts remaining in the home country with named beneficiaries — RRSPs, super, 401(k) all allow direct designation that bypasses the will and probate.

• A simple will in each country where personally-held assets sit, aligned with the foundation regulation so nothing contradicts.

• A registry with FTR head-office of documentation kept updated and centrally accessible — the biggest practical failure in cross-border estates is heirs not knowing what exists where.

• A proper visa & residency in Colombia, meaning they no longer had to worry about overstaying.

• USD bank accounts in Panama and COP bank accounts in Colombia with top-rated banks.

We were able to package this all together for the Australian-Canadian couple so that the total bill came in under USD $20k… not bad considering it’s saved them a lot of headaches, solidified their position, and it’ll save their children almost a million in tax when they pass.

What Happens Without Planning

• Multiple simultaneous probate proceedings — often years to resolve.

• Contradictory jurisdictional claims — Colombia says one thing, Australia another.

• Forced-heirship overrides on Colombian-resident estates.

• Substantial legal and tax costs eating into the estate.

• Heirs receiving assets years late, sometimes with tax due before they've received cash.

• Family disputes accelerated by the process, often becoming permanent.

The Time to Plan

Cross-border estate planning is best done at least ten years before it's needed. That gives time to move assets into the right structures, sort out the reporting, and update as circumstances change.

Second-best time is now. It's rarely too late until it is…