A Cyprus International Trust is set up under the International Trusts Law of 1969 (and the 1992 revision). According to the terms of the law, neither the individual nor the beneficiary may be residents of Cyprus, nor may the trust include “immovable property” in Cyprus. However, at least one trustee must be a resident of the jurisdiction.
Specifically, a trust is when the trustee (a person or legal entity) agrees to keep assets (the trust fund) for another person (the beneficiary). The terms of this agreement are decided in a document called the trust deed. The trustee must maintain the assets and any income produced by the assets with the beneficiary’s best interests in mind.
Back in medieval times, crusaders were required to leave their estate for long periods of time. During their absences, they appointed a trustee to watch over their land and possessions. This individual treated the assets as his own, but watched over them separately from his own property. A trustee served in the interests of the individual who appointed him.
Through the years, this function of trustee has evolved to meet our modern needs. Used as a method of securing one’s interests, trust can serve a myriad of objectives, from fiscal, family law, property law, and even charitable objectives.
A trust is the perfect vehicle for providing protection for both personal and business assets. Other vehicles, such as a limited liability company, might secure personal assets from business risks. However, the company is not safe from personal liabilities or obligations, particularly one that is under sole ownership. Legally, a company’s assets or shares can be taken to settle legal issues or debts. But this is not true with a trust.
Since the company shares and assets are held by a trust, any personal debts cannot affect them. They are safe and secure from private matters.
Investors use trusts for a variety of things, including estate planning, bankruptcy protection, and tax planning. Trusts are an ideal vehicle for maintaining complete confidentiality.
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