Offshore Trusts have been used for decades as high end Asset Protection vehicles.
Whilst Jurisdictions such as the Channel Islands, BVI and the Cook Islands have historically captured much of that business, with Compliance and cost in the traditional Trust jurisdictions increasing markedly in the past few years, new players are beginning to make a significant in the market place. This article examines one such offering ie the Mauritius Trust.
Mauritius is a group of lush tropical islands in the south western Indian Ocean and is located northeast of Madagascar and some 1,000 miles southwest of Seychelles. A former French and British colony, Mauritius offers:
- A British system of law and parliament
- Political/economic stability
- A well-developed Financial Services Sector; and
- A well-educated productive bi-lingual French/English speaking workforce.
Since gaining independence from Britain in 1968 the Mauritian economy has grown steadily from one reliant on agriculture to a more diversified economy with Tourism, Financial Services and Agriculture (primarily sugar cane) as its 3 economic pillars. This has seen a resulting rise in standard of living from low to middle income delivering levels of economic and political stability which are the envy of the region.
Whilst better known as a Banking Centre (Mauritius boasts at least 3 world standard “Offshore” Banks) Mauritius offers two forms of nil tax Offshore Company ie the GBC1 ( a domestic designed to do business or hold shares in companies based in DTA Treaty partner countries) along with a cutting edge Private Foundation and Offshore Trust Product.
Why a Mauritius Trust?
A Mauritius 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.
Trusts can migrate to and from Mauritius. For example Trusts in Jersey, Guernsey or Isle of Man and other jurisdictions can migrate to Mauritius and vice versa. The tendency over the last 5 years has been for trust to migrate to Mauritius because of various benefits.
Trust Registration & Confidentiality
A Mauritius Trust is not required to be registered anywhere thus providing confidentiality. A Trustee may register the Trust with the Registrar General to receive a “date certaine” which is registering the date of creation of the Trust.
Trust Assets: What can be held in a Mauritius Trust?
Mauritius Trust assets can consist of:
- Real estate (commercial or residential)
- Shares in companies, funds, unit trusts
- Insurance policies
- Other assets
A Protector: do you need one?
Under the Mauritius Trust Act, a Protector can also be appointed to oversee certain decisions of the Trustee. The powers of a Protector are not prescriptive but will vary on the particular circumstances.
Key features of a Mauritius 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 other Trusts limited to 99 years or less
- 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 the latter is a Mauritian resident or a body corporate resident in Mauritius
- 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 the creating the trust was to defraud him. The onus of proof rests on the creditor and no request for setting aside the trust will be entertained after more than 2 years from the transfer or disposal to the trust
- Trust can apply for a Global Business Licence – Category 1 and benefit from double taxation treaties.
A Trust created in Mauritius can provide for, amongst other things:
- 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 uncertainty
- Commercial transactions
- Overseas ownership of property while retaining beneficial enjoyment
- Strict confidentiality of the identity of the settlor, the beneficiaries and information relating to trust affairs
- Minimizing estate taxes or other inheritance taxes
A Mauritius Trust can elect to be non-resident by the Trustee filing a declaration to that effect with the Commissioner of Income Tax and be exempted from all income tax. All distribution made to non-resident beneficiaries of the Trust are also exempt income tax.
|We offer the following MauritiusTrust Formation & Administration Services:
Advice on Trust structuring
Drafting of Trust Deeds (including for Discretionary Trusts, Unit Trusts, Purpose Trusts, Charitable Trusts and more)
Resident Trustee services
Nominee Settlor services
Calling of (and taking minutes for) Trustees and Beneficiaries’ meetings
Bank account signatory services
Assistance with Trust Bank account establishment
Advising on and signing of agreements
Attending to changes of beneficiaries, variation of Trust Deeds etc
Offshore Trust accounting services
OCI Mauritius Trust Package
At OCI we believe in giving you more for your money than would the average Trust formation service. Hence included in the registration package for your Mauritius Trust is the following:
Documents included in your Incorp pack:
Certificate of Registration
A sealed/stamped copy of the filed registration application
Resolution by Trustee accepting appointment
Resolution to open a bank account
Resolution to appoint a lawyer for the Trust
Resolution to appoint an accountant for the Trust
Sample/template letter of wishes
Resolution appointing you as the Trust’s authorised representative in commercial negotiations
Resolution appointing you as Investment adviser to the Trustee
Agreement authorising you to represent the company in commercial negotiations
Agreement appointing you as Investment adviser to the Trustee
Price (all inclusive): $US2,990
From 2nd year $US2,500
Would you like to know more? Then please Contact Us:
DISCLAIMER: OCI is a Company/Trust/LLC/LP/Foundation Formation Agency. We are not tax advisers or legal advisers. You are advised to seek local legal/tax/financial advice in regards to your local reporting/tax requirements before committing to set up or use an Offshore Company or other entity.