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Jersey Trusts

Trusts in Jersey come under The Trusts (Jersey) Law 1984 which is very similar to English trust law.

Jersey is a popular choice for the establishment of trusts due to its political stability. It also has strong laws protecting and regulating its trusts. Asset Protection is probably the most important factor when deciding to set up a trust. Article 9 of Jersey Trust law states that when it comes to the transfer of property the court must apply to Jersey law only and no consideration be given to any rule of foreign law, this is of particular interest when it comes to forced heirship rules as they would not apply under a Jersey trust. This article further goes on to state that any foreign claim that is based upon a lack of understanding of trusts will be ignored by the court. These are indeed big advantages that Jersey trusts have when it comes to Asset Protection.

As Jersey has no capital gains tax, no inheritance tax, no gift tax, no wealth tax and income tax would only apply if the trustees are resident in Jersey it does indeed have many tax advantages to establishing a trust there.

There are various types of trust available in Jersey;

- Accumulation and Maintenance Trusts
- Fixed interest Trusts
- Discretionary Trusts
- Purpose Trusts
- Unit Trusts
- Charitable Trusts

By far the most popular type of trust in Jersey is the Discretionary Trust as this affords much more flexibility than the other types of Trust. This amounts to approximately 90% of Jersey Trusts. Discretionary trusts are of particular interest in the offshore environment as the trustees are the legal owners of any assets. This provides a level of distance between the original Settlor and Potential Beneficiaries meaning that tax implications arising from the existence of the trust may be beneficial.

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