Trusts are probably the best-known asset protection vehicle on the whole planet.

This common law structure offers a privileged possibility for high net worth individuals to safeguard their assets for many generations. It can be said it is the stalwart of a family office.

But this has led many to believe that the trust is a structure exclusively available for the ultra-rich. And that's a myth that must be eliminated from our minds.

And the Belizean trusts proves this.

Belize is one of the least-known offshore jurisdictions on the planet. We still don't understand how it isn't at the top of any offshore services list. The level of asset protection, combined with the tax optimization possibilities, reliability, and cost, makes it a top destination. In fact, we believe it can only be compared with the Nevis trust.

Why choose a trust in Belize?

Rock-solid protection

First of all, due to a read-between-the-lines loophole, a transfer of assets to a Belize trust, even if it's considered fraudulent by a Belizean court, it cannot be set aside. It is the only jurisdiction on the world that offers full protection from the beginning.

So, to put it in layman terms: if you're married and you transfer some assets to a trust in Belize and your wife files for divorce, she cannot touch your assets even if she claims the trust was created to defraud her. This is due to the fact that there are no fraudulent conveyance rules in Belize's trust law.

It is often the case that courts declare transactions fraudulent so spouses can seize assets protected by a trust. But that cannot happen in Belize. Not even the most sympathetic of judges can order such a thing.

Only local judgments are recognized 

Second, Belizean courts don't recognize foreign judgments. There's no way the Belize authorities recognize a foreign judgment. Belize is one of those rare breeds where laws are meant to protect investors and citizens, instead of the state. This is fantastic, especially for people living under authoritarian and statist regimes that may want to seize their assets. No government or creditor will be able to wield its power with a foreign court.

Tax benefits

Belizean trusts pay no taxes whatsoever. The trust and its properties are free of income and corporate tax, estate, inheritance, succession, gift, excise, stamp duty, and capital gains tax.

What sets Belize aside from other popular trust jurisdictions?

Trusts are the best-known asset protection structure on the planet. They are created to transfer assets from a person to a trustee. This clears the original owner of any legal or financial liability for the assets because the trustee is responsible for the assets. The beneficiaries are third parties, individuals or groups, that will be benefited through dividends or other means from the trust.

Belize has become a top trust destination whose level can only be compared with Nevis or Cook. In fact, it has one particularity that puts it above these jurisdictions. For example, Nevis and Cook Islands give one year for creditors to bring action against a trust claiming it was designed to defeat them. In Belize, the trust has full protection from the beginning.

Also, the Cook Islands may recognize some foreign judgments over their trusts. Again, that's not the case with Belize, as the only valid judgments against its trusts are those of Belizean courts.

Moreover, it is more flexible than these other jurisdictions as it allows foreign trustees, as long as they are licensed, and accounting is not required, albeit our experts strongly recommend it.

All this means that an international trust in Belize is an effective way to protect your assets. In the given case you suffer an asset freeze or bankruptcy, your assets in a trust won't qualify for forfeiture because you do not technically own them. Thus, they cannot be confiscated. You may think these events are unlikely, but as your assets increase, your vulnerability to lawsuits and other legal disputes also increases. It is also a good legal protection for those living under authoritarian regimes.

If you establish a trust in Belize, you can determine specifically who will inherit your assets, and you can highlight certain assets for certain occasions or persons while keeping everything confidential.

As if this isn't enough, it also provides substantial tax benefits as it will reduce your tax erosion. Trusts in Belize are effectively tax-free, which will help you secure more assets and optimize the wealth you and your loved ones will be able to gain access from the trust.

Furthermore, Belize trusts are simple to establish and, considering its benefits, are a low-cost solution.

Registering a trust in Belize

It is mandatory to register a Belize international trust. If that's not the case, the trust is invalid and unenforceable, according to the Belizean laws. Nonetheless, the registration information is kept private and is a simple process. The trust agent must provide the following information:

1.   Name of the trust.

2.   Date of settlement of the trust.

3.   Date of registration of the trust.

4.   Name(s) of the trustee(s).

5.   Name of the protector (if any).

6.   Name and address of the trust agent.

Taxes

As we've already stressed, these trusts are not liable to any kind of taxation. Moreover, they don't even need to file returns, financial reports, or records, if the following conditions apply:

      1.   The settlor and beneficiaries aren't Belizean residents.

      2.   The trust property doesn't include land situated in Belize.

However, it is always sound advice to keep a financial record of the trust, even if it's not required to file it with the public authorities.

Settlement of a trust and privacy

Trusts are settled through the establishment of a deed. The document should be limited to referring to the settlement of some assets upon a trust, without necessarily establishing who has settled the assets. Another possibility is following the conventional model but having a Belize IBC or international LLC to own the assets to be settled and have that company as the settlor. As these structures maintain confidentiality, they will allow you to keep your personal information private.

In fact, the Belizean Trust Act of 2007 clearly establishes that the identity of the settlor or beneficiaries isn't required. Section 65C (1) says:

"The Register (of Trusts) shall not be open for public inspection except that the trustee or the trust agent of a trust may in writing authorise a person to inspect the entry of that trust on the Register."

Thus, even if it's required to establish a trust in Belize, the information in the registration is private unless the trustee or trust agent expressly writes an authorization to do so.

Trustee

One great difference of the Belizean trust from other jurisdictions that allow for enhanced flexibility is that the trustee can be a foreigner. Section 17(1) of the Act says that "Any person who has under the law of Belize the capacity to own and transfer property may be the trustee of a trust." The broad terms of the statement basically mean that any adult individual that isn't mentally incompetent and any limited company can act as a trustee.

However, for greater certainty, most clients choose to have a licensed trustee to act, at least, as co-trustee.

It must also be noted that Belize IBC can act as the trustee, but cannot be in the business of being a trustee without a license from the IFSC (International Financial Services Commission). The law isn't entirely clear on how an IBC can act as a trustee, but we recommend the following:

·    It should do so only of one trust or a small group of interrelated trusts, such as trusts of members of the same family that are established in parallel.

·    Should only charge fees for costs incurred in acting as a trustee, but not take any remuneration for the service.

·   When using an LLC, special care should be taken if the jurisdiction of incorporation of the company may require a license or any other legal consent to act as a trustee.

·    The trustee should not be the beneficiary of the trust or its settlor, even if the Belizean laws don't expressively prohibit it. In the case of a corporate trustee, a beneficiary or the settlor shouldn't control it. If the settlor is also a beneficiary, it is not recommendable to make him the sole beneficiary of the trust.

·     The same applies to the protector. The law allows a protector to be the trustee, but as the natural role of the protector is to supervise the trustee's actions, it is wise not to mix the roles.

Protector

Belize international trusts don't require a protector, but it is common to use one, especially for discretionary trusts, to enhance tax optimization and asset protection.

The protector is usually a family lawyer, family member, or friend who follows the wishes of the settlor and will do everything in power to see those wishes fulfilled. Still, the settlor doesn't want to put that person with the responsibilities of a trustee.

Thus, a protector shouldn't have a benefit in the trust to avoid conflict of interest. The protector can receive any powers the settlor desires, but it usually has two. 1) The power to change the trustee and 2) The power to approve dividend distribution from the trust over a pre-determined amount.

These two powers allow the protector to serve as a balance over the trustee to ensure the trust fund is distributed following the settlor's desires.

What can we do for you?

Along with NTL, in Mundo, we have a long track record of helping family offices and high net worth individuals protect their wealth.

We have 25 years of experience helping you increase your freedom. This statement wouldn't be true if we didn't offer you service in the best trust jurisdictions on the planet, and Belize is among them.

In this time, we've built an unparalleled network of experts. And, let us tell you a little secret: we're registered agents in Belize. We can bring the local expertise that not many can provide.

For a fantastic price, our Belizean team can offer you:

·      Advising you about the appropriate trust structure and deed you need.

·      Filling of all forms and submitting the documents for registration.

·      Filling a standard deed or creating a special deed, including a final review.

·      Trustee acceptance fee.

·      First year's agent fee.

·      Registration.

·      Trustee services.

·      Tax and accounting advise for the trust.

What are you waiting for? Contact us immediately; and protect your family and your future with a Belize international trust!

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