We invite you to look at 7 specific cases when the use of an offshore trust in Nevis will give you a huge benefit.
- Nevis offshore trust: briefly about the necessary theory
- Three basic principles for creating an offshore trust
- Reason #1: Spendthrift trust for spender or incapacitated beneficiary
- Reason #2: Tax planning and inheritance of assets
- Reason #3: Preservation of wealth and smart asset distribution
- Reason #4: Forced inheritance
- Reason #5: Protecting personal information and privacy
- Reason #6: Asset protection
- Reason #7: Trust for charity
Nevis offshore trust: briefly about the necessary theory
What is trust? This is a special type of agreement when the trust settlor (trustor) transfers their property under the trustee’s management. The trustee manages the property, protects it, and distributes the benefits received in favor of the beneficiaries. Beneficiaries can be any persons or group of persons specified in the trust agreement.
The trust breaks the link between the owner and their assets. At the same time, if specified in the agreement, the former owner can benefit from using assets as a beneficiary.
Three basic principles for creating an offshore trust
To create trust trustworthy by the settlor and the outside world, three conditions are mandatory:
- Certainty of Intent: a clear intention of the settlor to create a trust by transferring legal ownership of the trust property to the trustee in favor of certain beneficiaries. The executed trust deed evidences this. Before the creation of a trust, clear communication is maintained between the settlor and the trustee for discussing the purposes and intentions of the settlor concerning the trust.
- Certainty of Subject: clearly defined trust property. The initial set capital specified in the trust deed is usually $1, $10, or $100, with additional assets to be added later.
- Certainty of Objects: clearly defined beneficiaries or beneficial class who will benefit from the trust, which may include the settler.
Important: the settlor can leave a few loopholes for maintaining control over the assets. A certain amount of control is allowed. But the higher it is, the higher the chance that the trust will be recognized as fraudulent and the assets within it as the settlor’s property is. Therefore, the degree of control must be minimized and secured by creating a well-formed trust deed.
And now, we will provide 7 reasons why setting up an offshore trust in Nevis is beneficial.
Reason #1: Spendthrift trust for spender or incapacitated beneficiary
Life can turn in different directions. For example, it may turn out that one of the heirs is a terrible spender. If you transfer all the property to such a person, they will lose it very quickly and most likely will earn debts.
In this case, the trust allows to control the use of funds by the beneficiary or, for example, to provide them with housing along with the family.
An alternative is a person who is addicted or incapacitated for health reasons. In this case, the trust can pay medical bills and provide proper care. Also, the trust can provide conditions for the life and development of this beneficiary’s children.
In addition, it is possible to include in the trust deed the conditions under which this support will be provided: reaching the age of majority, marriage, the birth of a child, etc.
Reason #2: Tax planning and inheritance of assets
In some instances, using a trust can significantly reduce the asset tax burden. It is convenient for global asset management and coordination between different sources.
In addition, there will be no inheritance tax in the case of property transfer through a trust. Taxes will only arise when the beneficiaries receive profits from the distribution.
In any case, tax matters should be discussed with tax professionals on a case-by-case basis.
on offshore structures and jurisdictions
that would best meet your
asset protection goals.
on offshore structures and jurisdictions that would best meet your asset protection goals.
Reason #3: Preservation of wealth and smart asset distribution
Setting up a trust will help preserve family property and pass it on to descendants. After the settlor’s death, the trust will ensure that the property remains in the family and the business works for its benefit. To do this, the trustee may hire a professional director from or outside the family.
The trust will also create a clear and undeniable basis for the distribution of assets after the settlor’s death and protect family property from embezzlement.
By using the services of an independent expert in asset management and control (trustee), capital can be preserved for the next generation, and property can be transferred to minors or other dependents.
Reason #4: Forced inheritance
In many jurisdictions, local law requires that assets owned by a person pass to designated heirs in specified proportions. Even the presence of a will does not always help in this case because it can be challenged.
When creating a Nevis offshore trust, the assets will be distributed following the provisions of the trust deed, and you will decide how and to whom to transfer property. Or you can give clear criteria for the trustee for use in the inheritance process.
Reason #5: Protecting personal information and privacy
For a wealthy person, it is essential not only to protect tangible assets but also to ensure the confidentiality of personal data. By transferring ownership of assets to a trustee, you can maintain confidentiality for yourself and your assets.
Unlike many other offshore jurisdictions, Nevis does not have a register of beneficial owners. When registering a trust with the Nevis Registry, the only information required is the trust name, the registered address (trustee address), and the trustee name. And this information is also confidential.
Reason #6: Asset protection
We deliberately started with the less-hyped feature of Nevis offshore trust. You can protect assets from social or political confusion, former assets’ beneficiaries, former spouses, and future creditors.
Any attack on your assets inside the Nevis trust will lead to big problems for the challenger: high costs and legislation that guards your interests in the first place.
The Nevis exempt trust law states that any creditor must make a USD 100,000 insurance fee before bringing any claim or litigation against the trust. The burden of proof also rests entirely with the applicant, who must substantiate their claim beyond a reasonable doubt. This is the level of evidence required in serious criminal trials.
To ensure maximum asset protection, make sure you follow the three principles listed at the beginning of the article. This will provide the trust with a high level of protection against any potential attack.
Reason #7: Trust for charity
If your soul throws more and you are ready to help the world – and there is always someone to help – you can create a charitable trust with specific goals. For example, this can be facilitating health care for low-income people, funding research on the fight against cancer, saving endangered species, or supporting emerging artists in your hometown.
If it is impossible to fulfill the charitable task that the founder set for the trust (for example, the species has become extinct or a cure for this disease has been found), the court may accept a new goal similar to what it was before.
As you can see, trusts have practical applications and can solve a wide range of tasks. This is especially noticeable in the long term.
These tasks include asset protection, wealth management, and inheritance – both material things and your principles through a charitable trust foundation. We help create trusts in Nevis and invite you to book a consultation right now: email@example.com.