Trusts and Foundations

A company onshore or offshore is normally formed to two possible reasons: a need for anonymity - in order not to appear either as a director or partner; and / or, to protect assets to ensure that they can not be seized. During the creation of an offshore company privacy you can be achieved with the appointment of a so-called "nominee" acting on behalf of the client. The customer gives it full powers on this nominee through a "general power of attorney", or expertise, in the form of a "limited Power of Attorney". Units or shares of the company may also be held by a "nominee shareholder", ie a person or company that holds the shares on behalf of clients to protect their privacy.

E 'can also hold the company's shares in a trust. The trustee holds the shares under pre-agreed conditions. A trust can contain any type of business including stocks, bank accounts and movable and immovable property. A trust protects the assets from being seized or controlled by third parties harmful. In case of death, the trust also makes it possible to transfer activity anonymously and discreetly, often without the need for approval and avoiding inheritance tax.

The Trust: principles and advantages

A legacy of the Middle Ages, the modern trust is an effective way to benefit from tax breaks and protecting assets. And 'commonly it used in common law countries. A trust is usually used as a holding other companies and is therefore the first link in a chain of ownership. The trust property is owned by a "trustee" (which can be either an individual or an entity) and may be subject to restrictions imposed by a "patron", if appointed. In general, the trustee must be authorized by a special, such as the service of the Finance Committee.

A combination of four entities is required to establish a trust:

  • The "settlor" which opened the confidence and settles all or part of his / her / its business on trust. The settlor may be a natural or legal person.
  • The trustee who manages the trust and its assets. The trustee acts in the interest of the beneficiary, and follow the instructions of the settlor. The trustee may also be a natural or legal person.
  • The beneficiaries are the people who benefit from the trust and its management by the Trustee. The list of beneficiaries may also include the settlor.
  • Protection, if appointed, is a neutral third party who has some control over the actions of the settlor, subject to the conditions of the trust instrument.

Benefits of trusts

The advantage of a trust is that it optimizes tax benefits for the assets of the settlor, in accordance with the tax laws of the country where the trustee, and the settlor may reside in another country. Trusts are also useful for the transfer of activities and avoid taxation and for holding assets belonging to different companies. Finally, a trust provides protection against the seizure of assets, because placed in trust assets are no longer owned by the settlor.

There are two main decisions when establishing a trust:

  • Discretionary or fixed interest discretionary trust not specify the distribution of income and assets, if not in a private document, and gives the trustee a discretion on his behavior while fixed interest trusts specify this distribution in the instrument of trust and limit the discretion of the trustee.

  • Revocable or irrevocable. Revocable trust allows the settlor to recover its assets and eventually the trust irrevocable trusts do not.

Foundation: Structure and Benefits

Fidusuisse Offshore can provide the skills needed to configure your foundation. A foundation makes it easier to manage your business. Foundations can be created in many countries and be fully customized through the use of the Statute. There are two main types of foundations: the first is a "charitable foundation", which focuses on a specific theme and that the funding of such activities as humanitarian aid, sports activities, cultural events, etc. are the foundations of art foundations of social solidarity as they allow you to purchase art and promote artists. The other type of foundation is the "private foundation", which is used on behalf of one or more private persons. This is the kind of foundation used for corporate foundations or family because you can contribute funds to allow this basis for growth. Even if a private foundation may also be a charity, a charitable foundation can not generally be used for the private good.

The advantages of foundations:

  • A foundation can own movable and immovable property.
  • You can buy vehicles (airplanes, boats, cars, etc.).
  • It may hold shares in companies.
  • It may have a specific purpose: humanitarian, sports, science, etc.
  • Unlike a trust is an entity set up with its own legal personality.
  • Foundations may be more acceptable to the civil law countries that trust.