A trust is established by an individual (“the Settlor”) and is a means whereby property (“the Trust Property”) is held by one or more persons (“the Trustees”) for the benefit of another or others (“the Beneficiaries”) or for specific purposes. The Settlor can be a Trustee and the Settlor and the Trustees or both can be Beneficiaries. The Settlor can appoint a “Protector” if he so wishes. The trust property can include all kinds of assets situated anywhere in the world. Trusts are usually created by wealthy individuals for the purpose of protecting their estate from inheritance or capital gains taxes in their home country. They can also be used by expatriates settling into a trust before repatriating assets acquired while working abroad, to protect such assets from the tax of their home country.


International trusts are governed by the International Trusts Law of Cyprus. International trusts are not taxed in Cyprus. Subject to a Trust Property of all descriptions can be settled into trust. However, the trust fund of a Cyprus International Trust must not include any immovable property in the Republic of Cyprus


An individual can be the settlor if he or she is capable of freely disposing of the property to be settled. A corporate body’s power to be a settlor depends upon the powers bestowed on it by its constitution or law.


Any individual - including unborn persons, minors, and persons of unsound mind - or a corporate body can be the beneficiary. A settlor creating a trust may also be a beneficiary of that trust. A trustee can also be the beneficiary of a trust provided that he or she is not the sole trustee or beneficiary as, in that instance, no trust would effectively exist.


An individual who is an adult and of sound mind, or a corporate body if authorised by its constitution, may be a trustee.


The settlor may stipulate that the trustees consult a nominated independent third party before exercising any power of discretion, in order that this third party, or protector, can be satisfied that the assets of the trust and the duties of the trustees are being attended to in a satisfactory manner.



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