There could be a tendency to confuse the trust with the offshore foundation. These two concepts are part of wealth management or offshore asset protection, helping you protect your assets and …
There could be a tendency to confuse the trust with the offshore foundation. These two concepts are part of wealth management or offshore asset protection, helping you protect your assets and capital. A trust or foundation allows assets, which you do not prefer to have registered, to be held by a legal entity. Know that trust and offshore foundation are not quite the same structure.
An international trust or a trust is a legal entity holding real estate or movable assets, and whose property is detached from the one who created it: the grantor or settlor. Thus, property changes ownership and officially belongs to the trust, which holds and retains it for its own account. In this way, the trust offers a very high level of protection of your assets, according to the law on trustees in each jurisdiction. For the trust to be valid, the assets must have been transferred. Check out http://offshorecitizen.net/ site for more information.
Types of Offshore Trust
Depending on its use, we can distinguish 4 types of trust:
- The charitable trust,
- The trust serving only for the protection of the heritage,
- The trust for estate planning, as would be a will,
- The trust against the squandering of property in case of illness, addiction …
Powers and legality of the trust
An offshore trust is not a legal entity, and therefore can not sue or sue, as a corporation or foundation could. But the trust may very well have a bank account.
The revocability of international trust depends on whoever created it, but it will be considered irrevocable if it is not clearly stated that it is revocable. The property of the trust is managed by the trustee for the benefit of the beneficiaries.
In matters of trust, investment activities are permitted but may be restricted by the laws of the country or by the letter of wishes
A lifetime of a trust
The life of an offshore trust is generally determined at 100 years. But trust can have an indefinite life when it is charitable.
The offshore foundation, also known as the International Foundation, is a legal entity with certain characteristics of the trust, in the sense that it contributes to the management and protection of the heritage; and society in the sense that it can sign contracts, have a bank account, and be used for limited commercial activities. But instead of shareholders, the foundation has a board, its governing body. Unlike the trust, it is not mandatory to transfer the assets to the foundation for it to be valid.
The different types of offshore foundation
We can distinguish 3 types of offshore foundations:
- The charitable foundation;
- The private foundation, also called private foundation, for the management of your personal patrimony, which can replace the will;
- The corporate foundation, for pension fund management, for the pension plan …
Offshore Foundation: Powers and Legality
The offshore foundation is a legal entity constituted by the registration of a document, the founding act or the declaration of incorporation. Thus, the foundation can very well be sued, as it can sue, sign contracts and agreements with companies or individuals, open a bank account and carry out a commercial activity, which however is not common but in accordance with the foundation legislation. To do business, it is rather advisable to use an offshore company, owned by the foundation.
Property held by a foundation is no longer attached to its founder once transferred to the offshore foundation.
Life of a foundation
The offshore foundation or international foundation may have an indefinite life. But its lifespan could also be defined for a number of years, in some cases.