A UK trust: an EU trust solution | Forum

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DustinSanders Nov 21 '23

It is now common practice to establish trusts in tax haven jurisdictions. Not many clients, however, are aware of the advantages that UK-established trusts can bring. The idea of a UK trust is especially attractive when beneficiaries and settlors are located in Europe or other onshore countries and do not wish the transfer of property to be associated with tax havens. Moreover, the law of England (under which the trusts get incorporated) confer the confidence and security of the UK legal system. A trust established in the UK offers reliability and reputation to its owners.

The first trustee of a trust established under the Law of England and Wales must be a UK-resident individual or company. In most cases, the trustee is a professional and licensed UK trust services provider. Contact Confidus now to set up your trust.

UK trusts are generally established in order to fulfil a certain goal (a few examples are listed below). For simple cases where assets are to be distributed to the beneficiaries after the settlor’s death, a UK trust will not be the best solution, as such a straightforward task is better handled in other well-known trust jurisdictions (see Panama private foundation for asset protection). A UK trust may be used for the following purposes:

Accumulating a diverse portfolio of foreign assets into one system for better organised, unified and professional administration. This solution also minimises your exposure to estate taxes and cuts out unnecessary estate duties and requirements.

As a tax-exempt holding structure. A trust serves as a good holding vehicle, especially for clients with several companies in different countries, offering a tax-free and confidential holding structure.

Reducing the burden of exchange control regulations and minimising exposure to inheritance taxes and other types of property taxation in your place of residence, and breaking the association or attachment between the owned assets and the heirs’ place of residence.

Achieving confidentiality with respect to the ownership of the assets. Throughout the UK, a trust’s legal documents do not need to be made publicly available. This provides anonymity and confidentiality for the settlor and the beneficiaries.

Avoiding forced heirship regulation, which your country may apply to your assets.

Guaranteeing the settlor’s plans for the future in case of death or incapacity.