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Seychelles Trust

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Overview

 

A Trust comes into existence when an individua+,l or a legal entity (Settlor) gratuitously transfers the legal ownership of assets (Trust Property) to another person or persons (Trustees) to hold for the benefit of other person(s) termed as the Beneficiaries or for a specific purpose. The Trustees have an equitable obligation, which bind them to hold and deal with the trust property in accordance with the terms of the trust.

Like the Seychelles IBCs, Seychelles trusts are proving to be increasingly popular in the global offshore trust market in particular the irrevocable discretionary trusts for high-net worth families. Trusts in Seychelles are governed by the Seychelles International Trust Act 1994, which allows for International trusts, charitable international trusts, purpose international trusts and other trusts including commercial (trading) trusts and life insurance trusts.

The Seychelles Trust provides a legitimate means to protect one’s assets against personal liability, high taxes, exchange controls or risk of confiscation.

 

Taxation

 

Seychelles International Trusts are tax exempt in Seychelles. Once registered, there are no annual filing requirements or returns.

Why a Seychelles Trust?

 

A Seychelles Trust gives the Settlor the requisite protection and comfort for a long-term wealth management under the Trust. Family assets are preserved over generations with most tax efficiency, succession laws, forced heirship rules, probate and other hurdles are avoided. Once a Trust is set up, it can own companies to own and manage any family business or wealth.

Steps for the setting up of a Seychelles Trust include:

  • Completing Trust Application Form

  • Provide KYC documents on all the parties (Settlor, Protector and Beneficiaries)

  • Execution of Trust Deed

  • Transfer of the Initial Trust Fund to the Trustee

  • Registration of the Seychelles International Trust


Trust Migration

 

Trusts can migrate to and from Seychelles. For example Trusts in Jersey, Mauritius, Guernsey or Isle of Man and other jurisdictions can migrate to Seychelles and vice versa.
 

Trust Registration & Confidentiality

 

A Seychelles Trust name (not the Trust Deed) is required to be registered with the authorities in the Seychelles. The registration process is straightforward and simple and it, in no way, affects the confidentiality of your trust. Though the Trust name is registered, the trust deed is not publicly filed. Disclosure of any information or document relating to an International Seychelles Trust is strictly prohibited by the Seychelles Law, except under an injunction granted by the Seychelles Supreme Court.

After successful registration, the Seychelles International Trust is issued with a numbered certificate of registration. Trust Assets: What can be held in a Seychelles Trust? The Seychelles trust assets can be anything other than a property situated in the Seychelles or any shares, debentures, or any beneficial interests in any body incorporated under the law of a country other than Seychelles.

Trust Assets: What can be held in a Seychelles Trust?

 

The Seychelles trust assets can be anything other than a pr

operty situated in the Seychelles or any shares, debentures, or any beneficial interests in any body incorporated under the law of a country other than Seychelles.

Protector

 

The function of a protector is to supervise the Trustee, thus providing additional assurances to the settlor that the trust assets are properly managed.

The Seychelles International Trusts Act does not specifically refer to protectors but it does expressly provide for the establishment of Trusts which require the Trustee to consult or obtain the consent of another person before exercising a particular function. Though there is no impediment to the appointment of a protector, the appointment terms and the powers of the protector should be explicitly set forth in the trust deed or other appointment instrument in order to maintain the formalities required by the Seychelles International Trust Act.

Key features of a Seychelles Trust

 

  • Choice of proper law by the Settlor.

  • Possibility for the Settlor to leave on or before his death letters of wishes setting out how he/she would wish the trust to be administered

  • Anti-forced heirship rules

  • Recognition of Purpose Trusts

  • Duration of the Seychelles International trusts to continue until the 100th anniversary of the date the trust came into existence.

  • Possibility to accumulate income for any period during the duration of the trust

  • No perpetuity rules for Charitable Trusts

  • Trust instrument may contain power to vary terms of trust.

  • No disclosure of the trustees’ deliberations, the name of the Settlors and the Beneficiaries unless there is an order from the court for the purpose of enquiry relating to trafficking of narcotics & dangerous drugs, arms trafficking or Money Laundering.

  • Trusts not being void or voidable due to the insolvency of Settlor or proceedings against him or latter being declared bankrupt. However, such trust may be void if the creditors prove beyond reasonable doubt that the intention of the Settlor at the time of creating the trust was to defraud him. The onus of proof of the intent to default rests on the creditor but no action can lie against the trustee of trust after more than 2 years from the date of transfer or disposal of assets to the trust.


A Trust created in Seychelles allows for, inter alia:

 

  • Strict confidentiality of the identity of the settlor, the beneficiaries and information relating to trust affairs.

  • Restrictions / controls over the enjoyment of property.

  • Multiple enjoyment or consolidation of ownership.

  • The holding, protecting and controlling of family wealth.

  • Asset protection against political, family or economic uncertainable

  • Commercial transactions

  • Overseas ownership of property while retaining beneficial enjoyment

  • The Setting up of Corporate Structures to maximise efficiency of planning and control of interrelated entities, while also maintaining confidentiality and protecting of beneficial owners. Example, a Seychelles Trust can be sole shareholder of a Seychelles IBC.

  • Minimizing estate taxes or other inheritance taxes

 

Premier Global Fiduciary Services DMCC is here to advise you how best to set up a Seychelles Trust and discuss all support services required. Know more about our Seychelles Office and our Services.

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