“…and they lived happily ever after?”

By Sergio Guerrero Rosas, Guerrero y Santana, S.C.

For that statement to be true, we must have control of what we want for our family and our heritage before any eventuality. If this is not the case, let's not allow our dream to become our worst nightmare; foreseeing possible disagreements is the best way to prevent them from happening.

Most people consider estate planning to be a matter of wealth, of concern only to people with considerable economic resources who worry about the stock market, inflation or the price of the US dollar and oil. The truth is that when we talk about estate planning, we are referring to all economic strata, without differentiating and/ or discriminating the income level of each person.

It is very important to determine and weigh the assets and interests subject to equity protection; while some will consider the purchase of a house very important, others will be thinking about the education of their children, or others about the protection of their property from secondary effects of a separation, etc. There are no better or worse choices, they are simply the primary needs of each case scenario.

Therefore, it is mandatory to ask a series of questions, such as:

  • Do you already have your will? It is worth mentioning that in Mexico, specifically during September of every year, a promotion is carried out with a reduction of up to 50% of notarial fees.
  • Are you concerned about the education of your children? There are saving programmes with good yields, linked to life insurance. Similarly, yields on goods held by trusts are not considered income if they are used to finance the education of direct descendants up to a Bachelor’s degree.
  • Do you have a separate property or conjugal partnership? Do you know what marriage agreements are? Leaving aside the romantic part of the relationship, it is important that you know the terms by which you formalise your marriage. Later on, it could save you from headaches.
  • Do you have an independent business? You will always have to keep its expenses and income separate from your personal income, so it is essential that you handle different credit lines as well as different cards.

You must have the business assets and personal assets clearly separated and identified according to their source of origin, since the sum of both will be the hereditary estate.

In order to carry out the succession planning of business assets, you need to consider the following steps:

  • Collection of data, information and documentation in order to know your intentions regarding the assets and possible successors.
  • Drawing up an inventory of assets, rights and obligations.
  • Classification of assets and drawing up the balance sheet.
  • Heritage analysis, detecting risks and potential for commercial exploitation of assets, representing the obligations.

Estate planning should be made in a holistic manner, considering financial, fiscal, administrative and legal matters.

The legal tools used will be of great importance; tools such as the Will and Testamentary Trust and Fiduciary Succession are certainly useful ones with very particular characteristics in estate planning.

In the same way, it is very important to consider, when inheritance planning, the possible tax implications, in order to reduce them as much as possible, always according to the local legislation of each country.

Remember that in Mexico, inheritances, bequests and donations are exempt from income tax, provided they are between spouses or received by the direct descendants of their ancestors, whatever their amount; this is in contrast to US law, where inheritances are taxed at a very high rate, and is only mentioned as an example.

Due to the above, it is mandatory to have the assistance of a group of advisors and consultants specialised in equity matters to achieve a comprehensive strategy and avoid making isolated decisions that in the future would only complicate a successful succession.


One of the advantages of estate succession planning is ensuring our peace of mind that everything will remain as we planned, maintaining and increasing our heritage.

Without any doubt, an adequate estate planning scheme will have the following advantages:

  • Our heirs will receive the assets in the manner and conditions that suit the needs, abilities and skills of each of them, directing them to growth.
  • Family ties will be strengthened, resolving in advance the economic issues that can destroy families.
  • While separation may sometimes be inevitable, it will prevent this from being an additional setback for each party, ensuring on the contrary that everyone is on track for their personal success even if different paths are taken, and as far as possible maintaining links of mutual aid or alternatively maintaining them without being affected.
  • The establishment of mechanisms of agreements that allow us to resolve potential conflicts in the best way.

Prof Sergio Guerrero Rosas

Prof Sergio Guerrero Rosas

Guerrero y Santana, S.C., Tijuana, Baja California, Mexico
T: : +52 333 120 05 38
E: This email address is being protected from spambots. You need JavaScript enabled to view it.; W: www.guerrerosantana.com.mx

Guerrero y Santana S.C. provides its clients with a wide range of tax, legal and consulting services. The firm makes comprehensive evaluations of its clients’ businesses and draws on the expertise of its professionals to offer the best solution available.
Prof Sergio Guerrero Rosas, Managing Director at Guerrero y Santana, has over 25 years’ experience advising companies from SMEs to multinationals, as well as individuals, on tax and estate planning. He is also the Latin American Chairman of International Taxation Practice Group and Global Vice Chairperson of the Trust & Estate Planning Practice Group.


Published: January 2018 l Photo: Bill Perry - Fotolia.com


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