Trust Company Formation & Trustee Services

The Concept of Trust

A Trust is a legally recognized arrangement with full contractual capacity, whereby a person being an individual or corporate body (The Trustee) agrees to hold the assets of the trust for the benefit of other person(s) (The Beneficiaries). The assets of a trust may consist of funds, shares, real estate and other property.

The Trustee is the legal owner of the trust who has certain duties and obligations derived from the terms of the trust document (The Trust Deed) and is accountable and acting for the interest of the Beneficiaries.  The Beneficiaries are the ultimate (beneficial) owners of the trust, whilst their identity remains undisclosed (secret) if they wish so.

The Cyprus International Trust

A Cyprus International Trust is one whereby the person that created the trust (The Settlor) and the Beneficiaries are not permanent residents of Cyprus and the trust property does not include any immovable property in Cyprus.  At least one trustee must be a permanent resident in Cyprus.

The establishment of a Cyprus International Trust provides a number of very important benefits including:

a)    Anonymity & Confidentiality

There are no requirements for registration or reporting for trusts established in Cyprus and no information is disclosed about the Settlor, trustees, beneficiaries and the assets of the trust.

b)    Asset Protection

All the assets of a trust are separated from the Settlor’s property and fully protected against any financial difficulties or bankruptcy or any other actions against the Settlor. Trust assets are also protected from any possible domestic inflation, foreign and domestic laws and regulations, claims and lawsuits, international actions and other reasons.

c)    Tax benefits:

  • Income, gains and profits are not subject to any tax in Cyprus whether income tax, capital gain tax, defense tax or any other tax.
  • There is no estate duty or inheritance tax.
  • There are no withholding taxes on dividends, interests and royalties received from a Cyprus Company.
  • A Foreign resident who retires in Cyprus is exempt from tax on the trust capital received and income earned abroad.

 

Trust formation and administration

The guide above is for general information purposes only and does not constitute a professional advice.  ServPRO can provide you a Professional advice for the planning of the appropriate form of an International Trust and assist you with the formation and administration of the trust.