Cross-jurisdictional taxes, small-business issues, and complex estate planning all came up in this year’s IAFP case study, which looked at planning challenges faced by a real-life, entrepreneurial couple that had moved from Australia to Canada.

Vancouver-based BC Partners in Planning (BCPIP) presented the case on day one, September 13, of IAFP’s conference. It looks at Josie, 41, and Damien, 40, who want to retire at age 55 and buy a home in Quebec. Like most investors, they’re extremely concerned about how their finances would be affected by the recession.

The case

Employment history:

The couple operates a textile importing business that produces approximately $200,000 a year in taxable income through sale of goods and collection of commissions. However, the firm’s status as a proprietorship makes them responsible for all losses and debt.


They have a toddler, and a baby on the way. The children are too young to predict if they’ll want to inherit the company.


Each holds a T20 $500,000 life insurance policy, but only Josie has private disability coverage.


Both have heard portfolio diversification is essential, but are unsure of whether they should move beyond simple stocks and bonds. Damien has a self-managed portfolio in Australia, and Josie holds various investments worth about $400,000. She’s also a joint beneficiary (with her siblings) of a $3.8-million family trust.

Real estate:

Josie owns three properties in Vancouver, one of which is their primary residence. Plans are to sell the residence and keep the other two rentals. The couple also owns a home in Tasmania, which they’re not renting out.

Estate planning:

Neither has completed a will; especially egregious since their net worth exceeds $2 million and they have a growing family.

Their goals

Their main objectives are to buy a home in Quebec close to Josie’s family, and retire at age 55 on $60,000 per year. They also want to start a farm on that home’s property. They’d already started researching homes, and needed help with the purchasing process.

Their retirement goals are aggressive, given the majority of Canadians are both living and working longer and their 15-year horizon.

Damien, who has a degree in agronomy, wants to start a farm on the new property, and plans to fund the venture by liquidating his investment portfolio. The operation will grow grain, so he needs more than 600 acres.

The issues


BCPIP’s Marian Snowball says one big problem for the couple is that all three properties are mortgaged. Also, property isn’t liquid. Since their cash flow is already limited, they face further risk.

She adds, “There’s also a practical issue with renting several properties when you have small children. Neither Josie nor Damien are extremely experienced managers and face possible trouble with managing the properties when also responsible for the farm and a young family.”


The couple needs to create one, but it can’t be done immediately due to their plans to move to Quebec. (They’ll need to reside in-province before drawing up a will there.)