Offshore Trusts

Trusts have been used successfully in Great Britain for several hundreds of years, the origin emanating for the need of land or assets to be held “in trust” on behalf absentee landowners. The transfer of assets to a third party can effectively be used for tax planning and inheritance purposes and/or in conjunction with an “offshore corporation”.

Trust are generally used for –

Tax planning, asset protection, and the distribution of asset to heirs or others.

There are many jurisdictions that offer trust services. It is important to choose a country that has a strong tradition of enforcing trusts and that that has passed modern legislation to allow newer concept of trusts. In 1990 Gibraltar modified its law to facilitate trusts designed to provide a higher degree of creditor protection.

In combination with a suitably located company ‘on-shore’ or ‘offshore’ it may be possible to transfer all or part of your assets into a trust. There are various types of trusts to consider-

• Asset Protection Trusts
• Employee Benefit Trusts
• Retirement Benefit Trusts

These types of trusts can be utilised to-

1. Hold the assets for your family which would not be subject in normal circumstances to capital gains or inheritance taxes.
2. For a company to divest itself of a percentage of the shareholding which may be put ‘into trust’ for political reasons to restrict the passing of the control of the company to an undesirable partner.
3. Own the family home or a holiday home. Which upon the death of the settler (the former owner) would pass to the beneficiaries (usually the remaining family)

Many countries such as the USA and UK have passed tax avoidance legislation making it difficult legally to set up a trust if the purpose is to avoid paying taxes. This is a complex area and specialist advice should be sought.

For further information, you can on this website supply us with some information about yourself by requesting a no-obligation, free tax-planning assessment . Or you can call us on +34 620059536 or Contact Us by e-mail.