Is an Asset Protection Trust a Good Idea?

If you have assets, you need to protect them. They can be at risk of everything, from government wealth confiscation to taxes. Why not take a cue from multi-billion dollar corporations and the affluent and set up a foreign trust? A properly designed asset protection trust can provide an extra layer of protection for your wealth, safeguarding it from anyone who may be trying to seize it.
There are several parties in a traditional asset protection trust: the settlor the creator of the trust, the trustee (whoever you entrust your wealth to), and the beneficiaries (the people you will leave your wealth to, such as your children). It is possible to make yourself the beneficiary, depending on the jurisdiction. The setup remains the same in an asset protection trust in an offshore location, except that the trustee will always be the financial institution of the chosen foreign country or bank within it. There are two main benefits to an offshore asset protection trust:

1. Tax benefits – You can enjoy reduced or even zero taxes depending on the jurisdiction of the country you will set your asset protection trust. You may also be entitled to other tax benefits depending on the financial institution you will set as your trustee, the beneficiaries, and who will establish the trust.
2. Protection – Western countries are becoming more and more litigious. Governments are invading their citizens’ financial privacies, especially when it comes to personal wealth. Local banks are also being targeted by criminals who use sophisticated technology to steal from the wealthy. Set up that extra layer of protection by applying for an offshore asset protection trust.

The process of setting up an offshore trust can be quite overwhelming especially if you have minimal knowledge on this subject, so it is best to contact a reliable and trusted offshore advisor.

Benefits of Having a Seychelles Bank Account

Setting up a bank account in another country is common practice among the affluent. If you have money that you want to keep and protected, consider opening an offshore bank account. Seychelles is a newcomer to the world of the offshore banking industry, which is why it is a good place to open an account and enjoy the following benefits:

• Anonymity –You are guaranteed complete privacy and confidentiality when you open a bank account in Seychelles.
• Hassle-free – You don’t necessarily have to go to Seychelles yourself just to start an account. It is possible to pay for bank introduction services. To find out if you qualify for a bank introduction instead of an in-person bank account opening, contact a Seychelles financial advisor. Qualifications will depend on the bank account you will open (whether it is personal or for a company), your business profile, personal background, and of course, financial standing.
• Lower minimum of initial deposit – At Seychelles, there are banks that require only US$50,000. Other offshore countries such as Hong Kong have a minimum initial deposit range of $1 million to $5 million US dollars.
• Online banking – Thanks to the sophisticated communications infrastructure in Seychelles, it is easy to get in touch with banks. In fact, there are banks that have advanced and modern online banking systems. This allows you to make transactions with your Seychelles bank account from anywhere in the world.

It is advisable to open a Seychelles bank account if you have a wealth that you want to protect or if you are planning to open an offshore company in the near future. The best thing to do is to enlist the help of a professional financial advisor—someone who can explain the requirements of Seychelles Banks and the local financial and banking laws that might affect you.

Important Guide for Offshore Bank Account in Seychelles

An offshore bank account in Seychelles is a perfect companion to an international business company in the same jurisdiction. Banking with a reputable international bank in Seychelles will ensure proper protection for the income and gains generated by an offshore company. The right bank should suit the business profile, background and financial standing. Not all banks are flexible to all companies and individuals, as some may require a specific minimum account balance. Some banks specialise in start-up and active trading businesses, while some may prefer to provide wealth management, private banking, and investment services to high net worth individuals. There are banks that may require a personal meeting with the IBC’s directors and/or beneficial owners before opening an account or within a specific timeline after the account has been opened.

Take note that opening an offshore bank account in Seychelles is not guaranteed and not automatic. Banks still have various policies for accepting clients, and some may reject certain types of clients with certain kinds of businesses or refuse to accept clients from certain countries. Working with a reputable offshore company formation specialist can help you choose the right bank in Seychelles where you can set up your account.

Reputable banks in Seychelles often require detailed business and personal information from controllers and owners of the offshore account before opening a corporate account for an offshore company with them. A bank must know the actual owners, controllers, and everyone who possess account signatory rights must be identified. Their identities must be supported by a number of documents like a certified copy of their passports, proof of address and in some cases references.

Opening an offshore bank account in Seychelles is often thought to provide complete anonymity, but that is not exactly the case. Banks still require your information, and if you are working with an offshore company formation company, you should provide all the necessary information, too. It is technically possible to open an offshore bank account in Seychelles without making a personal appearance in the bank.

Guide for Offshore Trust Asset Protection

Setting up an offshore trust will protect your assets from judgements and creditors in your country. With offshore asset trust protection, a judge in your country cannot compel the foreign trustee to release the assets or funds to a judgement creditor. An offshore trust can be a strong line of defence for your assets, especially when you set it up in a country with a jurisdiction that does not recognise judgements in your home country or only in strict circumstances where it is proven the assets were transferred to the trust to defraud a creditor Even if a judgement creditor ultimately pursues your assets in an offshore trust, he or she would often need to initiate expensive litigations to gain access to the jurisdiction of the offshore trust thus mitigating against frivolous claims.

Seychelles is one of the countries where you can set up an offshore trust to protect your assets. Trusts in Seychelles are perfect for high net worth individuals who want to protect their private wealth for their children and future descendants. In a Seychelles offshore trust asset protection formation, you abide by the International Trust Act 1994, which provides high amounts of flexibility and anonymity when it comes to your trust’s structure.

A typical Seychelles private trust has a settlor, one or more beneficiaries, a trustee, and an enforcer. The settlor transfers personal wealth and assets into the trust, the trustee is responsible for managing and administering the trust (which should be carried out to the wishes of the settler). To qualify as a trustee, he or she must be an adult with due diligence and a sound mind to sign a bind trust declaration. A beneficiary can be one or more people who will benefit from the trust formation. The enforcer is the supervisory person that monitors the administration of the trust while ensuring strict legal compliance.

An offshore company formation specialist can help you get started on an offshore trust asset protection. Find a specialist that is licenced and regulated by the Financial Services Authority, with knowledgeable and qualified professionals who are known for providing cost effective, efficient, and trustworthy services.

Advantages of Setting up an Offshore Company

Business owners choose offshore setups mainly for tax effectiveness, but there are many other advantages to establishing an offshore company, including reducing business overheads considerably. Attractive bonuses also include increasing confidentiality and asset protection. Below are some of the greatest advantages and benefits of choosing an offshore set-up for your company:

• Being registered as an offshore company legally minimizes your tax obligations. This is one of the main reasons why business owners choose to incorporate offshore. Non-resident companies are usually tax exempt or at the very least, enjoy lower levels of taxation, depending on the jurisdiction. This being said, corporate taxation matters can get extremely complex, which is why it is important that you are guided accordingly by experienced and accomplished professionals as you decide to incorporate offshore.
• Non-resident companies are also sometimes excluded from requirements to publish financial information and/or details of shareholders and directors, depending on the country where the company is incorporated. Most financial jurisdictions will not reveal these types of information to third parties unless terrorist or criminal activities are suspected.
• Offshore companies may also be utilised in strong asset protection strategies, not only in terms of monetary and real estate investments, but also when it comes to intellectual property.
• Legal obligations of officers and directors are also more relaxed than a conventional on-shore business, not to mention reduced administration responsibilities, which saves the company a great deal of time and budget.
• In addition to lower capital requirement, off-shore companies also have lower setup and maintenance costs. The process of setting up offshore operations is relatively simple and fast despite increasing anti-money laundering policies and measures being enforced. This translates to lower capital requirements and even lower costs when it comes to operation and maintenance of the company. In some jurisdictions, there is also no minimum capital requirement for registration.

Offshore Company Formation – A Business Method of Tax Planning

There are pervasive misconceptions that offshore company formation is all about hiding money and evading taxes. This is not the case. Forming an offshore company or relocating your business overseas is a step toward internationalizing your assets.There are legitimate methods of structuring your business interests offshore and realizing benefits from both an asset protection and a tax standpoint. In fact, giants like Google and Apple (among many other large companies) have already reduced their taxes by billions in 100% legitimate ways.

Tax Advantages of Offshore Company Formation

Running an offshore firm may entitle you to tax deferment, which means that you can postpone tax payment into the future. If you reinvest profits within the offshore company, you can technically defer tax payment indefinitely. Instead of having to pay taxes on your company’s profits every year, youmay have the option to reinvest that as capital back into your offshore company and only pay taxes when—30 years down the road, let’s say—you decide to sell your company or as and when you take dividend distributions, salary or similar. The ability to reinvest that money tax-free allows you to take advantage of the power of compounding interest,allowing you to multiply your wealth in ways you cannot if you didn’t have an offshore company.

Where to Go

There are a number of jurisdictions friendly to foreign investors like yourself–from Hong Kong to Seychelles to the British Virgin Islands. The key is to find a business environment that suits your goals and requirements, and of course, provides legal tax benefits.

Ask for advice from a corporate services provider and qualified tax attorney. You want consultants who understand international tax laws both in your home country and the jurisdiction you are interested in investing in. A good consultant can present your best options and walk you through the benefits of establishing a company in particular jurisdictions.