Should you set up of a foreign trust with or without a managed trust company? For an overseas investor, a foreign trust start-up can prove an effective vehicle to protect assets and do business with the full backing of British law. Foreign trust setting-up can work just as well for an individual as it can for a multinational corporation, but it is a complex process to set up the trust in the first place. Coddan Formations Agency offers free, expert advice throughout the trust establishment process and can help set-up and administer your foreign trust in the most tax-efficient, convenient and cost-effective way.
One consideration is whether to set up the trust with or without a managed trust company. The simplest, most transparent method of sets up a foreign trust is to name yourself as the settlor and a third person as the beneficiary. We can provide a professional trustee and assist with a bank account in the trust's name if you choose this option.
Alternatively, you may wish to use a managed trust company limited by guarantee, through a private individual in the United Kingdom. The final option is to establish a private company as the major shareholder of the trust. A managed trust limited company affords several advantages, including anonymity and complete protection of the beneficiary, but it's important to choose the right set-up.
A private limited company is a relatively cheap way to set up a foreign trust, but the company has to pay tax on its worldwide income. Its main purpose, therefore, is simply to protect assets from a creditor, spouse or foreign government agency. If income is generated through the trust, however, then Coddan Formations Agency generally advises clients to establish a trust management company with a nominated British citizen.