Own Nothing, but Control Everything – A Concept That Can Change Your Life
- Thread starter JohnLocke
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Check out mentor group and the below link, in the middle you can find a trusted service that I personally have been using in the past.
https://www.offshorecorptalk.com/th...company-formation-services.26419/#post-211557
They do St. Kiits and Nevis Trusts and company.
https://www.offshorecorptalk.com/th...company-formation-services.26419/#post-211557
They do St. Kiits and Nevis Trusts and company.
The general concept is that a Trust owns a company (IBC/LLC) and that company owns all the assets to be protected. You are appointed as manager of the company but the trust owns it. You don't own anything, but you control the company and therefore the underlying assets. You as manager can take money out of the company as a wage/loan etc however documented in your operating agreement or resolutions made.
Now choosing a Trustee is obviously important because they become the legal owner of the company and will therefore have the right to remove you as manager etc. You can reserve certain powers as︀ the settlor or put in provisions for beneficiaries however you need to be careful about︁ doing so, and if done, how much power you give these people. If you give︂ yourself as much power as the Trustee, a court will definitely rule the trust a︃ sham and place your assets back up for grabs as personal assets. - I found︄ a case where this happened in Cook Islands.
A good way to combat this is︅ is to appoint a protector. The protector basically oversees the trustee and has the power︆ to over ride their decisions, remove and appoint new trustees etc. You should have one︇ - there's only a few good cases to not have a protector. Again though, don't︈ give them too much power or they could simply remove the trustee and appoint themself︉ for example.
A quick word on dishonest trustees - it's very rare that they simp[y︊ steal your stuff. Instead what they more often do (if dishonest) is manufacture arguments between︋ beneficiaries, legal battles etc so that they can charge huge fees and slowly, yet legally︌ drain your assets.
Anyway, so essentially when a creditor comes chasing you, you dont own︍ the trust assets (the company or company's assets) so they are protected. The only way︎ to get the trust assets included for consideration by a court is to prove that️ the trust structure was a sham, illegal or not valid for any reason. This is why you don't give yourself too much power. Keep in mind, simply having a revocable trust means you are able to make changes and therefore is poor asset protection. Revocable trusts are great for estate planning however. Irrevocable trusts however are very permanent in nature so be sure before doing so. There are ways to make changes or dissolve them but it's tougher and thats generally a power that only the protector should have.
Now all of these structures for further protection should be setup offshore in a jurisdiction with a good history/reputation/trust & company law. For extra protection, the trust and company can be︀ two separate jurisdictions, provisions can be added like a flight clause, trustees refusal to act︁ if under duress, removal of managers if action occurs etc. Further, diversification is alway good︂ principle. If you have a high-risk business, you could hold it under the same Trust︃ but as a separate company from the one that just holds your money, houses etc.︄ That way if the company is sued directly, the other company is untouchable and you︅ "may" even be able to move some of the high risk company's assets directly to︆ the trust for protection.
As mentioned above, Nevis and Cook Islands are two often touted︇ as the best. Nevis IMO wins out slightly. Their law specifically states that they do︈ not recognize foreign judgements, that a local Nevis lawyer must hear the case in Nevis︉ (which is tough because a good lawyer always works for the trust companies), the creditor︊ must post up a bond before even taking action (I've often heard 100k but reading︋ their actual law it states 25k), there is a very short statue of limitation for︌ courts to even hear a case (often 1 year, sometimes 2) and the burden of︍ proof is on the creditor and is at the highest possible standard of "beyond all︎ reasonable doubt". Nevis highly regards privacy with nothing being public, the statute of Elizabeth is️ specifically written out of their law, spendthrift provisions are enforced and Lawyers have to work on retainer up front. In addition I've not been able to find any case of a creditor winning against a Nevis trust.
Oh - and they don't have any taxes. That will mean different things depending on your residency. But if you moved to a tax haven for example, theres no taxes at home or in Nevis company. If you live in a western high taxed country, there will likely be CFC laws etc that force you to declare info and income to be taxed as though it was local.︀ If not or you're in a tax haven, the only tax you'll pay is on︁ income made physically in another taxed country. For example if your company owns property in︂ Germany and earns rental income, the company will need to pay german tax while the︃ profit you've made trading non-real property like shares, crypto etc will be tax free.
Bit of a rant but hopefully that clears some of it up!
Now choosing a Trustee is obviously important because they become the legal owner of the company and will therefore have the right to remove you as manager etc. You can reserve certain powers as︀ the settlor or put in provisions for beneficiaries however you need to be careful about︁ doing so, and if done, how much power you give these people. If you give︂ yourself as much power as the Trustee, a court will definitely rule the trust a︃ sham and place your assets back up for grabs as personal assets. - I found︄ a case where this happened in Cook Islands.
A good way to combat this is︅ is to appoint a protector. The protector basically oversees the trustee and has the power︆ to over ride their decisions, remove and appoint new trustees etc. You should have one︇ - there's only a few good cases to not have a protector. Again though, don't︈ give them too much power or they could simply remove the trustee and appoint themself︉ for example.
A quick word on dishonest trustees - it's very rare that they simp[y︊ steal your stuff. Instead what they more often do (if dishonest) is manufacture arguments between︋ beneficiaries, legal battles etc so that they can charge huge fees and slowly, yet legally︌ drain your assets.
Anyway, so essentially when a creditor comes chasing you, you dont own︍ the trust assets (the company or company's assets) so they are protected. The only way︎ to get the trust assets included for consideration by a court is to prove that️ the trust structure was a sham, illegal or not valid for any reason. This is why you don't give yourself too much power. Keep in mind, simply having a revocable trust means you are able to make changes and therefore is poor asset protection. Revocable trusts are great for estate planning however. Irrevocable trusts however are very permanent in nature so be sure before doing so. There are ways to make changes or dissolve them but it's tougher and thats generally a power that only the protector should have.
Now all of these structures for further protection should be setup offshore in a jurisdiction with a good history/reputation/trust & company law. For extra protection, the trust and company can be︀ two separate jurisdictions, provisions can be added like a flight clause, trustees refusal to act︁ if under duress, removal of managers if action occurs etc. Further, diversification is alway good︂ principle. If you have a high-risk business, you could hold it under the same Trust︃ but as a separate company from the one that just holds your money, houses etc.︄ That way if the company is sued directly, the other company is untouchable and you︅ "may" even be able to move some of the high risk company's assets directly to︆ the trust for protection.
As mentioned above, Nevis and Cook Islands are two often touted︇ as the best. Nevis IMO wins out slightly. Their law specifically states that they do︈ not recognize foreign judgements, that a local Nevis lawyer must hear the case in Nevis︉ (which is tough because a good lawyer always works for the trust companies), the creditor︊ must post up a bond before even taking action (I've often heard 100k but reading︋ their actual law it states 25k), there is a very short statue of limitation for︌ courts to even hear a case (often 1 year, sometimes 2) and the burden of︍ proof is on the creditor and is at the highest possible standard of "beyond all︎ reasonable doubt". Nevis highly regards privacy with nothing being public, the statute of Elizabeth is️ specifically written out of their law, spendthrift provisions are enforced and Lawyers have to work on retainer up front. In addition I've not been able to find any case of a creditor winning against a Nevis trust.
Oh - and they don't have any taxes. That will mean different things depending on your residency. But if you moved to a tax haven for example, theres no taxes at home or in Nevis company. If you live in a western high taxed country, there will likely be CFC laws etc that force you to declare info and income to be taxed as though it was local.︀ If not or you're in a tax haven, the only tax you'll pay is on︁ income made physically in another taxed country. For example if your company owns property in︂ Germany and earns rental income, the company will need to pay german tax while the︃ profit you've made trading non-real property like shares, crypto etc will be tax free.
Bit of a rant but hopefully that clears some of it up!
Banking is a pain everywhere these days! A structure in Nevis, with or without a trust, will have plenty of options in the Caribbean but likely find it very tough in Europe. That’s just Nevis, and most tax havens really, and I don’t believe the Trust on its own would ring any alarm bells. They’re pretty common practice. You might have better luck with a European company︀ being owned by the Nevis trust but I’m just speculating there.
Not necessarily wrong yet at the same time it again depends on your story/background.
If you are an international player there will be banks working with you. If you are not it might be difficult.
Keep in mind that the trust (company/ies officers) become(s) responsible for the bank account opening (and keeping open) activities.
This among others︀ will mean that they will become involved in the accounts. If you were creative beforehand︁ it’s highly unlikely you can continue such behavior as the trust company will not want︂ to have anything to do with it.
In many cases - with the exception of︃ liabilities / estate planning - you don’t need international structures. Your home countries tax laws︄ give enough room to play around and in that way you keep your bank accounts︅ open and affordable.
Playing the international game used to be breaking even from around 100k︆ turnover per year. Right now it isn’t beneficial below 500k unless you specifically need and︇ want it based on your personal situation and don’t care that much about costs.
Nevis and cooks have been mentioned. Depending again on your personal︋ wants and needs cayman could be added or closer to home even one of the︌ Channel Islands or Cyprus.
Money wise I highly doubt it is worth to put it︍ in a trust. A private foundation might be more cost beneficial. For those Panama is︎ still one of the best (Ie cheapest) solutions.
Again; it all depends on your story,️ wants and needs. ( you mention Switzerland, don’t just contact someone via the internet. That will not work out for you. You need to take into account how Swiss authorities / legislators look at it. Contact local lawyers for consultation first ).
If you are an international player there will be banks working with you. If you are not it might be difficult.
Keep in mind that the trust (company/ies officers) become(s) responsible for the bank account opening (and keeping open) activities.
This among others︀ will mean that they will become involved in the accounts. If you were creative beforehand︁ it’s highly unlikely you can continue such behavior as the trust company will not want︂ to have anything to do with it.
In many cases - with the exception of︃ liabilities / estate planning - you don’t need international structures. Your home countries tax laws︄ give enough room to play around and in that way you keep your bank accounts︅ open and affordable.
Playing the international game used to be breaking even from around 100k︆ turnover per year. Right now it isn’t beneficial below 500k unless you specifically need and︇ want it based on your personal situation and don’t care that much about costs.
Nevis and cooks have been mentioned. Depending again on your personal︋ wants and needs cayman could be added or closer to home even one of the︌ Channel Islands or Cyprus.
Money wise I highly doubt it is worth to put it︍ in a trust. A private foundation might be more cost beneficial. For those Panama is︎ still one of the best (Ie cheapest) solutions.
Again; it all depends on your story,️ wants and needs. ( you mention Switzerland, don’t just contact someone via the internet. That will not work out for you. You need to take into account how Swiss authorities / legislators look at it. Contact local lawyers for consultation first ).
The fact is that if a trust is done correctly for tax purposes, the settlor loses all power over the assets of the trust -- other than whatever influence he has with the trustee. Although rare, things can go horribly wrong.
There was a high-profile case a while back where a wealthy family lost complete control over a huge amount of wealth place in a family trust. I do not have the time to research it. It involved either Switzerland or Liechtenstein, both of which are known for their rule of law.
For example:
https://www.independent.co.uk/news/...neficiaries-trustees-legal-laws-a8239956.html
There was a high-profile case a while back where a wealthy family lost complete control over a huge amount of wealth place in a family trust. I do not have the time to research it. It involved either Switzerland or Liechtenstein, both of which are known for their rule of law.
For example:
https://www.independent.co.uk/news/...neficiaries-trustees-legal-laws-a8239956.html
Yes indeed, doing your homework as many here already have said, is crucial. You can avoid a lot of trouble. I'm glad to read that you find the information interesting.
Enjoy your stay thu&¤#
Enjoy your stay thu&¤#
I try to follow advice from this article. Still can't get the puzzle together when it comes to protecting my bank assets.
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