The Power of Nevis Trusts for High-Net-Worth Individuals

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Nevis trusts offer a powerful solution for asset protection and effective estate planning. Understanding the concept of trusts and the distinct advantages of setting them up in Nevis is essential for those looking to secure their wealth.   

Exploring the fundamental aspects of trusts, their objectives, and the compelling benefits associated with Nevis as a jurisdiction will empower individuals to safeguard their assets, optimize their tax planning and ensure a seamless distribution of assets to chosen beneficiaries.   

Taking control of your financial future through a Nevis trust is an opportunity worth exploring.  

What is a Trust 

A trust is a widely utilized and efficient tool for owning and managing assets, based on an agreement established among three key parties: the settlor, the trustee, and the beneficiaries.   

This legally binding agreement allows the settlor, who is the initial owner of the assets, to transfer them to the trust, thereby transferring the legal ownership to the trustee, for the ultimate benefit of a third party, known as the beneficiary.   

The document governing this agreement is called the trust deed, in which the roles, responsibilities, and rights of the settlor and trustee are defined, while also serving as a comprehensive guide for the appropriate use and distribution of the assets.  

Onshore vs Offshore Trust  

Onshore trusts are established and governed within the legal framework of the settlor's country of residence or where the assets are located, offering familiarity with local laws but may have higher taxes and less robust asset protection.    

Offshore trusts are set up in foreign jurisdictions with favorable tax laws, enhanced asset protection measures, and increased financial privacy, making them attractive for reducing tax liabilities and safeguarding wealth.   

The choice between onshore and offshore trusts depends on individual circumstances, such as tax considerations, asset protection needs, and desired levels of privacy, requiring careful evaluation and professional advice.  

What is A Nevis Trust  

The Nevis Trust, formally known as Nevis International Exempt Trust, stands among the foremost offshore trust formation structures globally, renowned for its robust asset protection benefits and tax advantages. Governed by the International Exempt Trust Ordinance, this trust offers a powerful legal framework for safeguarding assets and achieving financial privacy.  

For high-net-worth individuals seeking a powerful, secure, and tax-efficient solution to protect and manage their wealth, Nevis Trusts prove to be an unrivaled choice.   

Benefits of Setting Up A Nevis Trust  

With a Nevis trust, you can experience peace of mind like never before, knowing that your assets are shielded from potential threats and your financial privacy is safeguarded. Embrace the security and confidence that come with entrusting your wealth to a Nevis trust, ensuring your legacy and prosperity are preserved for generations to come.  

Asset protection: Nevis trusts provide a secure shield against potential threats to your wealth and assets. Creditors face significant barriers when attempting to bring legal disputes against the Nevis trust.  

Tax and Estate planning: optimize your tax planning strategies with a Nevis trust, taking advantage of favorable tax regulations in the jurisdiction. Nevis does not impose any taxation on income, dividends or capital gains on trust property.   

Private and confidential: benefit from enhanced financial privacy as Nevis trusts prioritize confidentiality. Your trust's details, including the settlor and beneficiaries remain confidential.  

No forced heirship: Nevis trusts allow you to maintain control over the distribution of your assets, as described in the trust deed, without being bound by forced heirship laws.  

Annual reporting not required: avoid the burden of annual reporting, streamlining the administration of your trust.  

Preventing litigation: Nevis trusts deter potential litigation before it even begins with robust legal provisions such as:  

High bond: creditors must pay a substantial upfront bond of USD 100 000 to the Nevis Ministry of Finance to initiate legal action against the trust.   

Short Statute of Limitations: Nevis offers a short statute of limitations, ranging from 1-2 years, for pursuing claims against the trust.  

Nevis court and local attorney requirement: legal actions against a Nevis trust require physical presence and representation by a local Nevisian attorney.  

Local Courts do not recognize foreign judgements, which forces the claimant to start a new trial from scratch, with an already short statute of limitation restriction operating against them  

Mareva Injunction not allowed: Nevis law prohibits the use of "Mareva Injunction" -a type of protection order for the creditors- not allowed" 
 

  • Characteristics of the Nevis Trust

  • Name
    Nevis International Exempt Trust
  • Legal Framework
    Nevis International Exempt Trust Ordinance 1994, as amended
  • Legal System
    Common Law
  • Trust Types
    Charitable, spendthrift and non-charitable purpose trusts
  • Restrictions
    Settlor and beneficiaries must be non-residents of St Kitts & Nevis; local property in St Kitts & Nevis cannot be placed within the trust
  • Perpetuity Period
    100 years or in perpetuity
  • Re-domiciliation
    Allowed
  • Local Office
    Required
  • Trustee
    Minimum of 1 required, individual or corporate entity allowed
  • Trust Deed
    Private
  • Protector
    Allowed
  • Settlor named as Beneficiary
    Allowed
  • Annual Reporting
    Not required
  • Taxes
    Exempt
  • Forced Heirship
    No
  • Statute of Elizabeth Laws
    Excluded
  • Statute of Limitations on Fraudulent Conveyance
    1-2 years
  • Bond
    USD 100 000
  • Foreign Judgements
    Not recognized
  • Freezing Order
    Banned

How To Set Up A Nevis Trust  

Setting up a Nevis trust involves several key steps to ensure its proper establishment and compliance with legal requirements.  

Seek Professional Advice  

Before proceeding, consult with experienced legal and financial professionals who specialize in setting up offshore trusts and are familiar with Nevis trust laws. They can guide you through the process and help tailor the trust to your specific needs and goals.  

Choose a Trustee  

Select a trustee to manage the trust assets on behalf of the beneficiaries. The trustee can be an individual, a trust company, or a corporate entity. Consider their experience, reliability, and reputation when making your decision.  

Draft the Trust Deed  

Work with your legal advisor to draft the trust deed, which outlines the trust's terms, objectives, and the roles and responsibilities of the settlor, trustee, and beneficiaries. This document is crucial, as it governs the trust's operation and distribution of assets.  

Select Beneficiaries  

Decide on the individuals or organizations that will be designated as beneficiaries of the trust. You can include family members, friends, charities, or other entities according to your preferences. Beneficiaries as well as the settlor cannot be residents of St Kitts & Nevis.   

Choose a Protector (optional)  

Depending on your trust structure, you may appoint a protector to oversee the trustee's actions and ensure the trust's proper management. The protector's role and powers can be specified in the trust deed.  

Transfer Assets  

Transfer the assets you wish to include in the trust to the trustee. This may involve real estate, financial investments, business interests, or other assets as per your trust's objectives.  

Register the Trust  

The trustee will then register the trust with the Registrar of International Trusts in Nevis, providing the necessary information and paying applicable fees. This process involves detailing the trust's name, the registered address, and the name of the trustee, along with a signed declaration confirming compliance with the Nevis International Trust Ordinance. The registration of these limited details ensures the client's confidentiality and anonymity are preserved. The trust deed or declaration does not need to be registered, allowing the settlor and beneficiaries to remain confidential.  

Maintenance of Trust   

It is paramount that the trust remains at all times in full compliance  with the applicable laws and regulations.  While exercising their fiduciary duty, the Trustee, is responsible for keeping proper updated records of the trust, including the settlor, the beneficial owners, or the Protector (if one was named). The payment of the maintenance fee and other administrative expenditures fall also on the Trustee.. 

FAQ

  • A trust is a fiduciary relationship involving 3 to 4 parties: the settlor, trustee, beneficiaries, and, in some cases, a protector. This legal agreement is formalized through a trust deed, wherein the settlor transfers legal ownership of assets to the trustee and outlines the objectives, terms, and conditions for managing and distributing the assets to the beneficiaries.

    The settlor is the individual who creates the trust. The settlor places their assets in the trust, transferring the legal ownership of the assets to the trustee.

    The settlor appoints one or more trustees who are then accountable to manage the trust accordingly to the settlor´s wishes and objectives defined in the trust deed. The duties of the trustee include but are not limited to following the terms of the trust deed, defending the trust against any judgments or lawsuits, managing and investing the trust´s assets, and act in the best interest of the beneficiaries

    The beneficiaries are individuals or organizations designated by the settlor to benefit from the trust, which can include family members, friends, public institutions, religious organizations, or charities.

    The Trust can also benefit from the appointment of a Protector, who holds a power that -if invoked- is capable of directing a trustee in matters relating to the trust, even if the trustee has discretion over such matters. A protector can appoint or dismiss the trustee and is a useful overseer of the trustee's administration of the Trusts assets

  • When a settlor decides to create a trust, they appoint a trustee who receives legal ownership of the settlor's assets and becomes responsible for managing them according to the rules specified in the trust deed. This legal agreement ensures robust protection of assets, even in situations involving court judgments or orders to return financial resources. Once the assets are placed in the trust, it gains a level of protection and is no longer considered the settlor´s personal asset. As a result, a judge in the settlor´s country cannot compel a foreign trustee to release the assets held in their jurisdiction. Additionally, legal proceedings between two different jurisdictions are often suspended due to the high costs involved, adding further security for your assets.

  • A Nevis Trust can hold a diverse range of assets, including real estate properties, financial investments such as stocks and bonds, bank accounts, business interests, intellectual property, precious metals, and valuable collectibles like art pieces.

    It is important to note that a Nevis trust has restrictions when it comes to holding local property within St Kitts & Nevis. The Nevis trust structure is primarily designed for international asset protection and is not permitted to hold local properties within the jurisdiction.

Explore the Power of a Nevis Trust  

Take control of your financial future and explore the power of a Nevis trust. With its strong asset protection benefits, favorable tax advantages, and robust legal framework, the Nevis trust offers an exceptional solution for safeguarding your wealth and ensuring a smooth transfer of assets to your chosen beneficiaries.    

Don't miss out on the opportunity to secure your assets and enjoy enhanced financial privacy. Contact us and our experienced legal and financial professionals will help you set up your Nevis trust, tailored to meet your specific needs and objectives.