Trusts

What is a Trust?
What are the types of a Trust?
How can I apply for a Saint Vincent Trust?

What is a Trust?

A Trust is an agreement under which money or other valuable assets are owned and managed by one person (or company) for the benefit of another. Many different types of Trust may be created to accomplish specific goals. Each kind may vary in the degree of flexibility and control it offers.

The Trust Deed is a legal document containing the terms and conditions of the Trust and the authority of the Trustee. Unlike a Will it is a confidential document and does not have to be made public knowledge so the identity of the parties to the Trust can remain entirely in the private domain. The Trust Deed is an agreement between three parties:

The Settlor

The Settlor is the owner and the transferor of the assets into the Trust. Very many forms of personal or corporate assets can be transferred into a Trust such as mutual funds, annuities, bonds or shares, bank deposits, ownership of cars, yachts, real estate anywhere in the world (except Saint Vincent) and even patents or rights but the one requirement is that the amount (or value) of the assets transferred must be precisely known and stated in the Trust Deed. Once vested in the Trust the Settlor loses ownership unless the Trust Deed allows him to reclaim the assets at a later date. In the USA the Settlor can also be known as the Grantor, Donor or Creator.

The Trustee

The Trustee is the person or corporation which is the official and legal owner of the transferred assets and is the manager of the Trust. The Trustee(s) administer the Settler's wishes as expressed in the Trust Deed. In Saint Vincent law there must be at least one Trustee who holds a Registered Trustee license. The registered trustee is always Loyal Agency and Trust Corp, for any Trust we register or re-domicile but the settler has to appoint a co-trustee who will actively manage the Trust. If the settlor doesn't want a co-trustee and wants Loyal Agency and Trust Corp to manage the trust for him then he should contact us for applicable fees.

Who can be a co-trustee?

Any person who is an adult and of sound mind is eligible to be a co-trustee. A company incorporated under the Saint Vincent Companies Act may also be a Trustee of a Trust provided that it is licensed as a Registered Trustee under the Registered Agent and Trustee Licensing Act 1996.

The Beneficiary

The Beneficiary (or Beneficiaries) are those who receive an income, or the assets from, the Trust in accordance with the Trust Deed. They are the equitable owners of the assets (they receive the benefits from the assets) but do not own them directly. Beneficiaries can be restricted in terms of what they receive under the Trust Deed in almost any way possible within the law. For instance one Beneficiary may receive an income for life, another capital when he reaches the age of 25, another may receive income only for his children, etc, etc. The Settlor can also name a Protector a third party individual - in order to check that the Trust is being administered according to his wishes. Highly qualified attorneys are utilized to act as Protectors if required.

Who can be a Beneficiary?

Anyone can be a Beneficiary of a Trust governed by Saint Vincent law including a private individual, even if a minor, or a company as well as the Settlor, Trustee and Protector. A Settlor may also be a Beneficiary and a Trustee may be one of the Beneficiaries. Beneficiaries may also include charitable organizations and for purposes which are both charitable and non-charitable.

What are the types of trusts?

There are many types of Trusts but four types are mainly used: Spendthrift Trust (or Protective Trust), Charitable Trust, Non-Charitable Purpose Trust and Discretionary Trust.

Spendthrift (Protective) Trust

A Settlor may use a Spendthrift Trust if he wishes to protect the trust property against an improvident Beneficiary and the claims of his creditors.

Charitable trusts

Trusts created for charitable purposes are required to benefit the community or a substantial section of the community. Those purposes will be regarded as being charitable if they relieve poverty, advance education and religion, protect the environment and advance or protect human rights and fundamental freedoms.

Non-Charitable Purpose Trusts

A Non-Charitable Purpose Trust may be created for a purpose which is not charitable provided that the purpose is specific, reasonable, capable of fulfillment and not immoral, unlawful or contrary to the public policy of St. Vincent. The Act also extends the doctrine of Cy-pres to trusts created for non-charitable purposes: this allows for cases where a non-charitable trust is ineffective, or fails subsequently, the trust property may not revert to the settler - instead it can be applied for another purpose that is non-charitable and which is proximate to the original Trust.

Discretionary Trusts

These are Trusts where discretion is given to Trustees to select amongst a class of beneficiaries. They may also be used to exercise control over the young and improvident Beneficiaries of the Trusts. With a discretionary Trust the Beneficiaries do not have any right to any part of the Trust Fund. The Trustees under the terms of the Trust have a discretionary power to distribute the capital and income of the Trust to the Beneficiaries as they the Trustees see fit.

How can I apply for a Saint Vincent Trust?

The following documentation is needed for a Trust application:

  • A Trust Deed which states the purpose of the Trust, Beneficiaries and Co - Trustees *
  • Full Due diligence (notarized passport , bank reference and verified utility bill copies) of all Co - Trustees, Beneficiaries , any signatories and all other  parties involved in the Trust
  • Full Due Diligence of the Settler (notarized passport , bank reference and verified utility bill copies)
  • Official Trust Application form – Form ITA1

Trust Deeds are uniquely tailored to individual circumstances and no two Trust Deeds are ever alike. LATC strongly recommends that you consult an experienced Trust attorney or lawyer in your own country for assistance in drawing up a Trust Deed and to advise you on the tax and inheritance implications for you or your heirs or beneficiaries of establishing an International Trust in St. Vincent and the Grenadines.

For our applicable Trust formation fees please click here.

 

 

Please Note:

According to International Trust Act, 1996.

PART XIV

Miscellaneous

Custody of copy

of instrument.

63. (1) The Registered Trustee of an international trust created under this Act

shall keep as confidential information in the territory of the State

(a) a copy of the instrument creating the trust and copies of any other instrument

amending or supplementing such instrument;

(b) a register in which the following information is set out

(i) the name of the settlor,

(ii) if a purpose or charitable trust, a summary of the purposes of the trust and

the name of the protector(s) of the trust, and

(iii) such documents as are necessary to show the true financial position of the

trust, which shall be current as of one month following the close of each fiscal

quarter.

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