Creating an offshore trust – benefits, asset protection, jurisdictions

Creating an offshore trust – benefits

The information below will help you familiarize yourself with the trusts on St. Vincent and will serve as a guide for potential offshore founders exploring the benefits of creating a trust and its purpose. At this site, we describe why trust is a highly profitable enterprise and an important step towards protecting its assets.

It is necessary to point out the main difference between a non-offshore and an offshore trust, namely: in an offshore trust, assets are stored in another country, and the trust is created under the laws of an offshore jurisdiction.

What is a St. Vincent Trust?

According to the legislation, Saint Vincent and the Grenadines Foundation to Saint Vincent requires for its creation the presence of a trustor who must transfer his assets / personal fortune to a trust. The trustee is the appointed person responsible for managing the trust and fulfilling the conditions of the declaration of trust in the interests of the beneficiaries (a person or group of persons who directly benefit from the trust). The trustee must be of legal age, in his right mind and conscientiously execute the declaration of trust. The guarantor controls the trust’s activities and ensures that the trust declaration (or trust agreement) is in conformity, and also ensures that the trust functions in a satisfactory manner. The trustee manages the trust on behalf of the founder (who transferred his assets to the trust) in the interests of the designated beneficiaries.

After its creation, the trust does not acquire the properties of a legal entity, but it does allow the founder to transfer its assets from his ownership to the trust, where the appointed trustee will take care of them.

Why create an offshore trust in St. Vincent?

Saint Vincent and the Grenadines became a haven for offshore founders wishing to create a trust in order to protect their assets. Despite the fact that trusts are usually created by very rich people, people with less money can also create a trust, since there is no requirement for the minimum amount of capital needed to create a trust. Saint Vincent and the Grenadines has been a popular jurisdiction for all kinds of founders for many years thanks to the legislation in force here regulating trusts. Trusts created here are subject to the International Trusts Act 1996 (amended in 2002). The legislation of Saint Vincent and the Grenadines provides for the registration of a declaration of trust (confidential) in the State Register of Trusts. One of the attractive aspects of creating trust in St. Vincent and the Grenadines is to avoid the right to an obligatory share in the hereditary mass and “common property regimes”. Another attractive property of trusts is that the rulings of foreign courts regarding an international trust, founder or beneficiaries cannot be implemented if the legislation of a jurisdiction of such a court does not comply with the law of international trusts of St. Vincent and the Grenadines. A notable feature of local trust law is the requirement that lenders or other external organizations when filing claims against a trust, do this within two years after the trust has been created. The only way for a lender to sue St. Vincent against a trust is to prove that the founder created a trust with a fraudulent purpose.

According to the legislation of Saint Vincent and the Grenadines on international trust cannot affect the insolvency of the founder in the jurisdiction of his residence. Moreover, an international trust in St. Vincent may own an international business company in St. Vincent.

Trust Assignment in Saint Vincent and the Grenadines

– Asset Protection

– inheritance planning

– Benefits for children

– Benefits for employees.

The most frequently created trusts in St. Vincent

– Target trusts – are created for a specific purpose, but without the appointment of beneficiaries, which is permitted by law

– Charitable Trusts

Benefits of offshore trusts in St. Vincent

This jurisdiction offers a wide range of benefits for offshore personal investment. A list of some of them (without limitation) is shown below:

– Claims against St. Vincent’s creditors are required to pay a cash deposit of $ 25,000 in case they lose their claim against the trust

– In Saint Vincent and the Grenadines, you can use professional knowledge and professional services for effective tax planning

– Trusts on St. Vincent are exempt from general taxation.

– There is no inheritance tax

– There is no currency control

– The rules on the timing of the existence of trusts do not apply

– The existence of privacy laws provides a high degree of security and privacy.

– Protection of desires of the testator by avoiding the right to an obligatory share in the inheritance mass

– There is no requirement for a minimum amount of capital to create a trust, which significantly simplifies the process of creating a trust by offshore investors

– Excellent reputation as a stable government and financial center

– High level of return on investment

– The stable and flexible infrastructure of the economy.

Offshore funds in St. Vincent

What is the foundation in Saint Vincent and the Grenadines?

The foundations in St. Vincent and the Grenadines are well-known as a corporate alternative to trusts due to the fact that the foundations become legal entities after their creation, which allows the foundation to act as a plaintiff and defendant in court, enter into contracts with third parties and own the assets of the foundation on behalf of the foundation .

In accordance with the legislation of Saint Vincent and the Grenadines, to create a foundation, a founder is needed, who is the person / organization that creates the fund, the guarantor necessary to ensure compliance with the management of the fund, as in the case of trusts, the beneficiary, the person or group benefiting from the fund; and, finally, board members. A fund is created to protect assets and efficient financial planning, and not to operate as a company. Accordingly, the assets of the fund do not belong to anyone specifically but belong to the fund itself, which is usually created in the interests of the company’s offshore clients.

Types of funds in St. Vincent

– Public fund – created by families, groups, etc.

– Private fund – created by private individuals, usually they are represented by private investment funds.

– State Fund

– Mixed Fund – can be created by any of the above.

Mixed funds are a regular organization in St. Vincent, where they serve as a highly effective asset protection tool and allow founders to legally accumulate their funds in an offshore area where they enjoy tax exemptions. In terms of their structure, mixed funds are flexible, and there are few requirements for them. The main requirement for the founder – is the presence of debt for corporate expenses or liquidation, not exceeding $ 100.

Assignment of funds to St. Vincent

– Asset Protection

– Protection of property from political and financial instability in the jurisdiction of the founder

– Efficient property management

– Tax planning

– Centralized corporate control, ensuring good fund manageability

– Schemes of employee participation in profits and pension schemes

– Charity groups

What assets can you keep offshore in St. Vincent?

Such assets include, but are not limited to:

– Shares and securities

– Bank deposits

– Life insurance policies

– Investment portfolios

– Real Estate

– Intellectual property

Foundation Benefits at St. Vincent

– Presence of own legal entity and, as a result, independence in property and financial management

– Funds, particularly mixed ones, can effectively protect assets

– Contributors have the right to exclude the deposited amount from income taxation

– Tax haven for offshore founders due to its modern and flexible approach to creating trusts and foundations

– High degree of confidentiality, especially in terms of offshore investments in trusts and funds

– The geographical position promotes international relations and access to other jurisdictions of the world, with the result that the fund is at the center of financial activity in the world

– The Foundation may own many corporations and enter into agreements with third parties.

– The possibility of implementing the prescribed instructions, as is the case for trusts operating according to the declaration of trust

– Lack of capital gains tax or company income taxes.