Use of Purpose Trusts in Cyprus

The Cyprus International Trust is a powerful legal structure that has been used for decades by individuals and businesses to protect their assets, manage their wealth, and plan their estates. However, what many people do not know is that the Cyprus International Trust can also be used as a purpose trust, providing a range of benefits for those who wish to use this flexible tool.

What is a Purpose Trust?

A purpose trust is a type of trust that is established to achieve a specific purpose rather than to benefit specific individuals. This means that the trust property is held for a particular objective, such as for charitable purposes or to support a specific cause. Unlike traditional trusts, the beneficiaries of a purpose trust may not be ascertainable, and the trust may be managed by a trustee who is not required to distribute the trust assets to any particular person.

What are the Benefits of Using a Purpose Trust?

There are several benefits of using a purpose trust, including:

Flexibility: A purpose trust provides greater flexibility compared to traditional trusts as it can be used to achieve specific objectives. This makes it a powerful tool for individuals and businesses who want to support a particular cause or achieve a specific goal.
Asset Protection: A purpose trust can provide asset protection by ensuring that the trust property is used only for a specific purpose. This can help protect the assets from creditors or other third parties.
Tax Planning: A purpose trust can be used for tax planning purposes, such as to reduce tax liability by donating assets to charitable causes.
Estate Planning: A purpose trust can also be used as part of an estate planning strategy to ensure that assets are distributed according to specific wishes.

 

Who Can Benefit from Setting Up a Purpose Trust?

Individuals and businesses who wish to support a particular cause, achieve a specific goal, or protect their assets can benefit from setting up a purpose trust. Some common examples of purpose trusts include trusts for charitable purposes, trusts to support education or research, and trusts to preserve historic buildings or land.

In conclusion, the Cyprus International Trust is a versatile tool that can be used as a purpose trust, providing flexibility, asset protection, tax planning, and estate planning benefits for individuals and businesses. If you are interested in setting up a purpose trust, it is important to seek the advice of a qualified professional who can help you navigate the complex legal and financial requirements of this unique legal structure.