Cayman Islands Trust Services
As a service provider licensed to provide full trust and corporate services, whether you are a private individual, an intermediary, a family office or an institutional investor, we can help you realise your objectives in setting up your offshore entity or structure in the Cayman Islands.
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Trusts are among the most secure and versatile financial planning vehicles available, and are widely recognised internationally. Cayman’s trust law allows trust arrangements to be tailored to clients’ specific objectives.
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We work closely with all local law firms, and can therefore provide a wide range of trust deeds to suit our clients’ requirements. These trust deeds can be tailored for individual requirements and IMS are able to make these available to our clients at a competitive cost. We are proud of our servicing standards and risk adverse business practice. Our service offerings are competitive with reference to service quality, cost and flexibility.
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Our Services
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Establishment and comprehensive administration of trusts, including on-going liaison with professional advisers and other parties.
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Acting as holder of management shares for investment funds.
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Acting as trustee of unit trusts or private trust arrangements.
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Preparation of appropriate financial records.
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Implementation of controls to ensure that confidentiality and protection of assets are maintained at all times, as legislation allows.
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Damien Austin
Captive Insurance, Private Clients and Board Member
Tel: +1 (345) 814 2857
Email: daustin@ims.ky
Wealth Management
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As an independent and fully licensed trust and fiduciary service provider in the Cayman Islands, we can work with our clients’ own preferred advisors (tax, legal, financial etc.) when dealing with wealth structuring matters.
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We have a wealth of experience in establishing offshore structures to individuals, families and blue chip companies alike. A combination of trusts and private companies continue to be the preferred structure for wealth management purposes worldwide, which can help to ensure privacy and provide efficient asset management and administration.
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Used correctly, and with appropriate legal and tax advice, trusts (with or without underlying companies) can be extremely robust tools, used not only for securing tax neutrality but also in achieving succession planning goals (e.g. by avoiding forced heirship rules) whilst creating flexibility for beneficiaries and protection from the unknown, such as political upheaval and reckless or imprudent beneficiaries.
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Please see our Purpose Trusts page and our Private Trust Companies page for more details regarding the more popular trust tools being utilised of late by our clients.
Purpose Trusts
STAR Trusts (known in other jurisdictions as purpose trusts) have been available for use in the Cayman Islands since 1997 following the enactment of the Special Trusts (Alternative Regime) Law, 1997, which has since been incorporated into the Trusts Law (revised) (the “Law”).
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The introduction of the STAR Trust regime represented a huge shift in the potential uses for Cayman trusts, resulting in a highly adaptable tool for settlers which allows much greater flexibility in structuring possibilities, subject of course to the STAR Trust’s purpose(s) being lawful and not contrary to public policy.
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The uses for STAR Trusts will continue to evolve and grow, limited only by the creativity of settlors, lawyers and trustees, but the main benefits of their use will be the flexibility and confidentiality afforded by their use. Examples for uses of STAR Trusts include:
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a STAR Trust may be created for philanthropic purposes that are charitable in the popular sense without risking that the trust could be held to be invalid because its objectives are not exclusively charitable in the legal sense.
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in a commercial context, a STAR Trust can allow a transaction to be effected ‘off-balance sheet’ or in a bankruptcy remote ‘Special Purpose Vehicle’ where the beneficial ownership of the shares in a company is not vested in any of the parties to the transaction.
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funds settled for the relief of victims of a disaster may be established as a STAR Trust such that it may benefit causes not considered to be strictly for the poor or which may not be considered charitable.
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Dynastic style trusts to hold family businesses or heirlooms, preserving them for future generations.
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Enforcer
It is a requirement that STAR Trusts have an ‘Enforcer’, who is the only person with standing to enforce the terms of the STAR Trust (the Law removes that power from the beneficiaries (if the trust has any), as well as the rights of beneficiaries to obtain information relating to the trust and its administration). The Enforcer is usually a close friend or family member of the settlor or one of the settlor’s legal or other advisers. Where a professional Enforcer is required, IMS has close working relationships with other service providers in the Cayman Islands who provide Enforcer services at a very reasonable cost.
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Trustee
The trustee of a STAR Trust must be or must include a trust company licensed to conduct trust business in the Cayman Islands pursuant to the Banks and Trust Companies Law (Revised). This provides the settlor with comfort that the administration of the trust is being carried out by a suitably qualified and experienced person or entity. IMS holds a full trust licence issued by the Cayman Islands Monetary Authority to carry on trust business and can provide comprehensive trust services. We can also act as Enforcer where we do not act as trustee.
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Documentary records of the following must be kept, in the Cayman Islands, at the office of the trust corporation acting as trustee:
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1. the terms of the STAR Trust;
2. the identity of the trustee(s) and the enforcer(s);
3. all property settled upon the STAR Trust and the identity of the settlors;
4. the property subject to the STAR Trust at the end of each of its accounting years; and
5. all distributions or applications of the trust property.
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Contact us at contactus@ims.ky or click on the links on this page to find out more.
Private Trust Companies
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Private Trust Companies (PTCs) are companies incorporated to act as trustee of a trust or a number of related trusts, for example with the same settlor or related settlors. They are not able to provide trust services to or solicit business from the general public.
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PTCs are very popular among High Net Worth/Ultra High Net Worth (HNW/UHNW) clients who desire a level of influence over, or at least a greater involvement in, the administration of the trusts under the control of the PTC, such as, for example (and subject to tax considerations) by appointing family members or trusted family advisers to the board of directors of the PTC.
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PTCs are therefore a good place to start when considering establishing a family office or a complex wealth management structure for the administration of a family’s various interests and have proven especially popular where a patriarch wants a continued involvement in the direction of the family business.
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The PTC acts as trustee of the family trust(s)/connected trusts and generally instructs a Cayman service provider such as IMS to provide some or all of the directors to the PTC and/or provide secretarial services and prepare accounts etc.
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The most common ownership structure for a PTC is for the shares of the PTC to be held on a purpose trust, known in Cayman as a STAR Trust (see our Purpose Trusts page for more information), which would itself have a professional trustee and be administered by an offshore trust administrator such as IMS. Other ownership options are available but may be less attractive from a tax perspective.
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Star Trusts must have an Enforcer (selected by the client), and will generally include provisions providing for certain controls and/or powers to be exercised by the Enforcer in respect of the STAR Trust, which would often include the power to appoint and remove trustees.
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Often, where tax considerations might prevent family members from sitting on the board of the PTC, they may be able to act as protector or as part of a protector committee, allowing them to be involved in the family’s affairs at some level.
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To find out more about PTCs, and how IMS can assist you, please email us at contactus@ims.ky.