Gibraltar Trusts

Trusts were an early device developed by crusaders in the 12th & 13th centuries to ensure their legal ownership in land and property was re-conveyed to them upon their return from the holy wars.

A similar concept was enshrined in Roman law known as fidei-commissa.

Traditionally, Trusts have been a conventional vehicle used by individuals to structure their estate and succession planning to benefit from:

  • Tax mitigation
  • Protection of assets
  • Succession planning
  • Ease of asset transfer

Trust Form and Use

At its most simple, a trust is an arrangement whereby a settlor, which will usually be an individual, but not always, contributes or gifts assets in to the hands of a trustee.  The trustee will hold the legal title of these assets “on trust” for a beneficiary or a range of beneficiaries who ultimately will benefit from the trust’s capital and income. The Trust is usually documented either by a settlement or a deed of trust which will set out the rules by which the trustees must operate the trust. These rules may also include discretion of decisions made by the trustees.

Trusts provide a flexible structure for protecting family assets and are often used for constructive tax planning. Additionally, they may have equal purpose in preserving family assets where:

  • Children are not yet sufficiently mature
  • There exist potentially Fragile marriages
  • There may be Physical and mental deterioration with age
  • There are unexpected windfalls

Most types of property can be put in trust: land, shares, money, insurances, chattels and other personal assets. There can be wide flexibility as to who are the beneficiaries, when or whether they are to receive any benefit, and how much that benefit will be.

Common forms of trust include:

  • Discretionary  Trust
  • Life Interest & Interest in Possession Trust
  • Settlor Interested Trusts
  • Accumulation and Maintenance Trusts

For more information on these forms of trust please click here

Relevant Law

Gibraltar Trust legislation is based on trust law in England & Wales in the form of the Trustee Act 1895. It has evolved as a mechanism, as amended and based on the English Trustee Act of 1893.

Taxation of Gibraltar Trusts

For tax purposes, where a Trust is created by a non-resident of Gibraltar (non-resident settlor) for the benefit of non-resident beneficiaries, such trusts are exempt from all taxes in Gibraltar.

Registration and Privacy

A Gibraltar Trust may be registered in accordance with the Gibraltar Registered Trusts Act 1999, however this is entirely voluntary. Gibraltar Trusts need not be registered and thus remain confidential and private arrangements.

The initial structuring of a trust needs care, skill and experience. It must achieve the underlying purpose, provide the right flexibility, avoid constraints imposed by law and stay within complicated tax requirements, both in Gibraltar and in any territories in which the Settlor, beneficiaries, or the assets reside.

We have considerable experience in this field.  We will work with our clients and importantly with their non Gibraltarian advisers to ensure that an appropriate trust structure is devised to meet required objectives. Speak to us today about your requirements.