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Trust and Offshore Trust

In the field of offshore, we speak of offshore business, helping you to optimize your income, benefiting from attractive taxation in foreign jurisdictions. But we often talk about foundations, trust or offshore trust, which also seem to interest more people, especially to better manage their wealth.

The benefits of using the Trust or Offshore Trust

Thanks to offshore Gibraltar you can protect your capital, benefiting from favorable taxation (inheritance taxes). In addition, you also protect yourself from the consequences of lawsuits after a divorce, or the political instability of your country. But for that, you can not be the trustee of the assets yourself.

The trust or offshore trust allows you to plan your estate against inheritance. Once in the trust, your assets will be protected because the rules of inheritance will no longer apply. This can replace a will, allowing you to divide your wealth as you wish, without wasting time and money certifying a will. In addition, this succession planning through the trust is entirely confidential, contrary to the terms of a will. In this context, it is important to note that the offshore Trust can be created during the lifetime or after the death of a person, by means of a will. The creator can safely transfer the ownership of his property while keeping the final control.

Even if the Trust can not do business, you can invest money for your trust. Thus, even if the Trust or the Offshore Trust is often used for humanitarian, educational, philanthropic purposes …, it can also help you in your wealth management.

The Trust, what is it?

The Trust is a legal agreement very often used in the concept of offshore tax exemption. Thus an offshore trust is generally used with an offshore company, particularly very effective for the protection of your offshore assets.

Also called Trust, the international trust is the relationship between the person who creates the Trust, called the settlor, the person in charge of the Trust, including the trustee, and the beneficiary, that is, the person to whom the Trust benefits.

The different types of Trust or Offshore Trust

The types of Trust or offshore trust are generally determined by its objectives.

  • We speak of a charitable trust when its purpose is to help causes or charities. The Charity Trust generally benefits from tax advantages defined by the laws of the jurisdiction in which its activities are carried on.
  • There is also an offshore Trust or Trust for the sole purpose of protecting your wealth. Specifically, the assets will be transferred to the Trust, and will no longer be attached to the owner.
  • The Trust or the Offshore Trust also serves to plan the estate, or manage the estate, as a testament. With this type of Trust, you can divide your assets according to your wishes.
  • Finally, the Trust also allows you to protect yourself against the squandering of your assets. Thus, this Trust prevents your assets from being wasted if you would never be able to take care of your financial affairs, illness, addiction, or other problems …

Creation of a Trust or Offshore Trust

Creation of a Trust or Offshore Trust

How to create a Trust usually depends on each jurisdiction. But to build trust, you usually have to prepare a trust contract if you are the settlor. This contract can also be called a trust contract or a declaration of trust. Then, the property will be transferred to the trustee for the benefit of the beneficiaries. Once these steps are completed, the Trust should be valid. As a settler, you can write a letter of greeting, also known as a memorandum, in addition to the trust agreement, detailing exactly what the trustees can do.

To help you build your trust, it is advisable to use the services of professionals. Indeed, the laws could differ from one country to another. In most cases, an offshore trust or trust needs an authorized agent and a head office located in the offshore jurisdiction or tax haven where it is incorporated.

The offshore trust, tax niche of billionaires

Everything is good to grab some small millions of euros on the back of the tax, as shown in the case, Bettencourt. But in the catalog of schemes and bundles (tax havens, offshore investments, foundations …) we did not mention the fashionable martingale: the trust.

The trust is neither a natural person nor a company nor anything. It’s an entity, an abstract reality. An act by which a person entrusts his property to another person, so that it manages them for the benefit of a third person, before handing them to a fourth person – the one who, at the expiry of the trust, pockets the setting. All this under the possible control of a fifth thief called the “protector”.

I know, I know, we do not understand anything. But it’s on purpose. Especially since it can be complicated when there is a meeting of several trusting candidates.

What an advantage, you will say to me. Well, the main advantage is that the assets put in trust no longer appear in the patrimony of their owner. Since legally, he has disposed of it in favor of the trust – until he or she or his heirs get it back.

A good trick trust, no!

You think that the tax administration has long been interested in this gem of Anglo-Saxon law. But she has more or less broken her teeth. Thus, the Nanterre Court of First Instance ruled that a French resident could not be subject to the ISF for income from a trust created in the US. And, in 2007, the Court of Cassation broke the nail in a judgment that highlights the fiscal interest of trust open abroad.

” It can, therefore, be used to plan an estate, prepare for retirement, fund a charity … or simply organize a temporary separation. Thus, Sylvio Berlusconi put in a trust his stakes in Italian television during his tenure as prime minister, “reads Money Week. And to cite the example of a US resident, a French citizen, who died in France in 1995, whose heirs (French) have cashed in the estate without paying a cent to the tax authorities. Because the deceased no longer legally owns the property, it was not a legacy but a transfer for free.

Not to be outdone, in 2007, France created its own trust but reserved only for companies: trust.

Article 2011 of the Civil Code gives us this definition, convoluted with pleasure: ” The trust is the transaction by which one or more constituents transfer goods, rights or security interests, or a group of goods, rights or interests. security, present or future, to one or more trustees who, holding them separate from their personal assets, act for a specific purpose for the benefit of one or more beneficiaries. “

Good!

It was said, at the time, to curb offshoring. Yet last year, the trust opened to individuals.

To put it simply, today,  for a fixed fee of € 125, each can create his trust. Still, there must be something to put in it. One can imagine the advantages on the ISF or the inheritance tax … But I am perhaps bad tongue: the law is too recent to have the slightest idea of ​​its fiscal interlinkings.

In the meantime, if Mrs. Bettencourt had slipped her island into a trust under Anglo-Saxon law, which is as old to her as the world, the aces of the financial brigade could have sought for a long time to whom she belonged, because she would not have belonged to anybody.

So why did not his wealth managers use this ploy? I will be careful not to repeat the opinion of the tax lawyer who made the effort to introduce me to these techniques …