Cyprus is a common law jurisdiction, and the concept of Trusts has always been part of its law, based on the doctrines of Equity. However, in July 1992 Cyprus enacted the International Trusts Law [69(I)/92] (the “Law”) which regulates the establishment and administration of international trusts.
This new Law has created a more flexible legal framework for international trusts and it now offers an excellent opportunity for non-residents to create a Trust in Cyprus.
The Cyprus International Trust is exempt from taxation and can be used effectively for tax and other planning considerations.
- Benefits
- Trusts and beneficiaries of trusts are not taxed in Cyprus;
- No Capital Gains tax is paid by the International Trusts;
- Distributions to beneficiaries are not subject to tax in Cyprus;
- Assets can be added to the trust at any time;
- The trust can be a shareholder in a Cyprus Company or a foreign company;
- If the Cyprus Trust is a shareholder in a Cyprus Company it will enjoy the tax and other benefits of the Cyprus international company;
- Trust assets are permanently separated from the Settlor’s personally owned assets
- The trust can be revocable or irrevocable;
- There are no registration or reporting requirements for trusts established in Cyprus and the names of the trustees or beneficiaries named in the trust document are not disclosed, which ensures confidentiality;
- There is no estate duty or other inheritance tax in respect of assets belonging to the trust;
- There is a power to change the applicable law of the international trust.
For more detailed information please contact us.