Quality Without Compromise

Trusts

A Trust, also called a Settlement, has formed a key element in personal financial planning under Common Law for over one thousand years and can rely on legal precedents (decisions) handed down by the courts of all Common Law countries, jurisdictions and states. Other countries and jurisdictions have passed statutory laws to permit Trusts under their legal systems.

A Trust is created by one or more persons or corporate bodies (the Settlor) requesting one or more persons or companies (the Trustees) to hold assets for the benefit of other persons, companies, bodies or charities (the beneficiaries).

The Trustees are appointed and dismissed in accordance with the Trust Deed. The Trust Deed may stipulate that a Protector is appointed and that the Protector, a company or an individual, holds the power to appoint and dismiss the Trustees. The Protector mechanism can give added assurance to the Settlor. The Protector may also be appointed and dismissed by a person or company that holds the power to appoint the Protector. Forward Associates can arrange for a professional independent Protector to be appointed the Protector if the Settlor does not wish to appoint his own.

The Trust can hold its assets either directly or through underlying (or holding) companies that it owns. For example, the Trust may own real estate that is held by a specially created company for each property. The Trust may have an investment portfolio of cash, bonds, shares and precious metals etc and may appoint managers to advise or manage these assets which may be held by one or more custodian banks. The structure of those underlying holding companies is usually dictated by tax considerations. The Trust may also own trading companies and many other types of assets including fine art and jewellery.

In summary, the Trust is a master holding vehicle that can provide considerable financial benefits and much flexibility.

Key features of a BVI Trust

• No disclosure or public registration requirements.
• Mitigation of estate and death taxes.
• Orderly transfer of assets upon death of the Settlor.
• Mitigation of forced heirship provisions.
• Ability to shelter family wealth within a secure private trust structure.
• Exempt from all BVI taxes if the trust beneficiaries are not residents of the BVI.

In 2004 the Virgin Islands Special Trust Act (VISTA) came into force. this piece of legislation introduced some forward thinking chnages to local trust law. The principal one among them being that the Trustee is relieved from the "prudent man of business rule" which basically means that the role of the Trustee is not to extend to the active management of assets settled into the the trust,theerby allowing the Settlor to retain greater degree of practical control.

Purpose trusts are also commonly used where there is a specific purpose and upon completion of said purpose the Trust will terminate. These are often used to provide solutions in a number of commercial situations.

Trust statutory fees.

BVI Trusts are subject to a US$200.00 trust duty payable on the execution of the trust deed.