One of the best places on the planet to create a trust could be Jersey. The island has a long history of working with trusts; it provides a good active and beneficial protection.
Trust in Jersey is governed by local law. At the same time, the trust manager may not be resident of Jersey. Trusts in Jersey are exempt from taxes and duties throughout its life cycle.
A positive feature of the Jersey law is a provision that the islands legislation prevails over other countries’ jurisdictions. Advantage of such trust approach is, for example, allocation of the assets in the case of inheritance, the law of the “indispensable inheritance” does not come into force as it is in many jurisdictions.
The law on trusts operating in Jersey allows founders to retain some influence in the work of the trust, through the appointment of protectors, appointment or releasing of all the managers and controlling persons, beneficiaries, trust law changing and by the trust law jurisdiction changing.
In Jersey several types of trusts could be created, including:
Cumulative. Such trusts are working in the interest of future generations, although their managers are not restricted to transfer part of the current income to the beneficiaries. A trust can exist up to 100 years, after the expiry founder’s heirs get the property in their posses.
Fixed, fixed beneficial entitlement to income, depending on the time, terms and amount.
Discrete trusts. Unlike fixed trust, in this kind of trust manager is able to use its discretion in the distribution of income among the beneficiaries, even though he has the founders’ recommendations.
With reserved powers. This type of trust allows to a third party (for example, the founder or his representative) effect trust and income distribution. An important aspect is the balance of powers in creation of this kind of trust.
Target trust. This is a new kind of trust, which can be set up in Jersey. Feature is the ability to create a trust for any purpose, such as financial transactions.
Jersey trusts are not taxed if beneficiaries are not island residents (otherwise beneficiaries must pay income tax). On Jersey work private trust companies acting as trustees for various family trusts, to provide greater flexibility in the management of assets and heritage. These companies are exempted from compulsory licensing, if they subject to compliance with certain conditions relevant to their field of activities.