Your Guide to Setting Up a Nevis Offshore Trust: Requirements & Documents

For international entities, individuals, and families worldwide with assets in various countries, protecting wealth is a major challenge. The Nevis offshore trust is an optimal way to safeguard assets, maintain privacy, and manage wealth globally.

Therefore, a popular question many clients ask is, “How do I form a Nevis trust?” Here we outline the Nevis trust formation process step by step. The article also details all Nevis trust formation requirements, explains the KYC and due diligence required for Nevis trust formation, and outlines the required documentation for a Nevis trust.

Note: Establishing a Nevis offshore trust involves more than completing a form and having signatures from interested parties. Requirements for establishing an effective offshore trust are detailed below. 

Key Takeaways

• Offshore trusts are established in Nevis as a contract or agreement whereby assets are placed under the care and management of a trustee to benefit one or more beneficiaries.
• To set up a Nevis offshore trust, several fundamental requirements must be met. Firstly, there needs to be a trustee or trustees (appointed) that will manage the trust; a trust deed needs to be drawn up; a beneficiary or beneficiaries need to be identified; and finally, assets of the grantor need to be transferred to the name of the trustee(s) of the newly formed trust.
• These documents express the intentions of the grantor(s) or creators of the trust. They describe how the trust’s income and principal are to be distributed to the beneficiaries. Typically, these documents include the trust agreement, letter of wishes, trustee agreements, and other asset transfer documents.
• Offshore Nevis asset protection trusts are created for individuals worldwide who have assets globally and want to develop an estate plan while retaining the ability to move their assets around the world.
• When we set up a Nevis trust, we establish the trust structure, select the trustee(s), complete the grantee’s due diligence and Know Your Customer (KYC) checks, draft and sign the trust deed, register the trust, and transfer assets to the newly created trust.  

Nevis Offshore Trust: An Overview

An offshore Nevis trust is a structure set up to manage others’ assets. The individual who sets up the trust is called the settlor. He can transfer assets to the trust he set up, and the trustee will then manage them for the trust’s beneficiaries.

Offshore trusts, including Nevis trusts, divide legal title of property from beneficial ownership.

Typically, three parties are involved in a Nevis offshore trust:

• The Settlor: The Settlor sets up the offshore trust and funds it by transferring assets into the trust fund.
• The Trustee: Manages the trust’s assets and runs the trust in line with the terms set out in the Trust Deed.
• The Beneficiaries: Individuals who will receive benefit(s) from the trust established.

A protector of the trust can also be included in the terms of a Nevis offshore trust. The protector can oversee the trust’s trustee(s). A protector of the trust is not mandatory and is included in the trust terms at the settlor’s request to afford the settlor additional powers and rights. The protector can be given approval powers over the Trustee(s)’ decisions and, overall, an oversight role.

Offshore trusts are established and administered under the provisions of the Nevis International Exempt Trust Ordinance (NIETO). 

Nevis Trust Requirements

Before establishing a Nevis trust, it is first important to understand the normal structure of a trust. A settlor can establish a trust and fund it with assets, which are then managed by one or several trustees for the benefit of one or several beneficiaries. The trust deed sets out the terms and conditions of the trust. The protector for the trust is also appointed where required.

Additional points to consider when establishing a Nevis Trust include registration requirements and Know Your Customer (KYC), Anti-Money Laundering (AML), and other due diligence requirements that must be complied with.

Summary of key requirements:

• A settlor who establishes and funds the trust
• A qualified trustee
• One or more beneficiaries
• A trust deed outlining the terms of the trust
• Assets to be settled into the trust
• KYC and due diligence documentation
• Completion of relevant registration requirements
• A registered office or local presence as required by the Nevis trust laws applicable in the specific case. 

TRUSTS & FOUNDATIONS
FREE CONSULTATION

on offshore structures and jurisdictions
that would best meet your
asset protection goals.

on offshore structures and jurisdictions that would best meet your asset protection goals.

We’ll contact you in 10 minutes

CLICK TO
BOOK CLICK TO
BOOK

We’ll contact you in 10 minutes

Step-by-Step Process for Establishing a Nevis Offshore Trust

Now, let’s look at the Nevis trust formation process. Each situation is different, but these are the general steps to establish a Nevis trust.

Typical Nevis trust formation steps include defining the trust’s purpose, choosing a trustee, completing KYC and due diligence, preparing and signing the trust deed, meeting applicable registration requirements, and transferring the initial assets into the trust.

1. Define Trust Objectives

The main purpose of an offshore trust, such as a Nevis offshore trust, is to set out the trust’s objectives.

Common reasons for creating an offshore trust include:

• Asset protection
• Estate planning
• International wealth management
• Succession planning

The settlor outlines the intended beneficiaries, the assets to be transferred into the trust and distributed among the beneficiaries, and the general way the trustee (s) will manage and administer the trust. 

2. Select a Licensed Trustee

Choosing a trustee for your Nevis trust is important.

Trustees may include:

• Licensed trust companies
• Fiduciary professionals
• Regulated offshore service providers

The Nevis Financial Services Regulatory Commission oversees and governs the trustees of a Nevis trust.

When selecting a trustee (or trustees) for a Nevis trust, consider the trustee’s role in managing the trust effectively and maintaining all records relating to the distribution of the trust’s assets, as set out in the trust deed. More than one trustee may be required to manage a trust, and in some circumstances, establishing a private trust company (PTC) may be considered. 

3. Complete KYC and Due Diligence

In forming a trust, the trustee or service provider completing the trust formation will also complete the Know Your Customer (KYC) and due diligence on all parties involved in setting up the trust. This enables the trustee to identify all parties involved and obtain background information on the settlor, including the origin of the funds and assets to be transferred to the trust. The trustee will also verify asset ownership and review the proposed trust structure to identify any potential breaches of Anti-Money Laundering (AML) laws and regulations.

To complete the KYC process for a trust structure, the required information may differ depending on the proposed trust structure. Information about the settlor(s), the beneficiaries, the protector(s), and any other party involved in the proposed trust structure has to be gathered. Furthermore, we must identify any underlying entities (e.g., a private trust company) and the individuals involved with those entities.

For example, identification documents, such as a copy of the settlor’s passport, ID card, driving licence, and proof of address, would be required from all parties involved in the trust, including any beneficiaries, protectors, and directors of any underlying entities, including a private trust company. Background checks would be conducted in order to determine the source of funds of the settlor(s). Additionally, the settlor(s) would be required to provide bank statements, references, professional endorsements, and ownership documents for any assets intended to be transferred into the trust.  

4. Draft the Trust Deed

The legal team at Q Wealth will draft the Trust Deed for the Nevis offshore trust.

The Trust Deed (or Terms of Trust) for the Nevis offshore trust forms the basis of the trust and sets out its purposes and the roles of the settlor, beneficiaries, trustee, and protector (if any).

A trust deed sets out why a trust has been established and includes details of the roles of all parties involved. The parties involved in a trust are the settlor, the beneficiaries, the trustee(s), and the protector (if any). The trust deed also sets out how a trustee is to deal with the trust assets and how they are to be distributed to the beneficiaries.

5. Prepare Supporting Documentation

Supporting documentation (e.g., letters of wishes, trustee agreements, compliance documents, etc.) will need to be prepared before the trust is activated.

This can include a letter of wishes, a trustee agreement, completed KYC forms, a set of due diligence questionnaires, and other relevant documentation outlining the settlor’s assets and how they will be transferred to the trust. 

6. Complete Registration Requirements

After the execution of the trust deed by the settlor(s), the trustee or the registered service provider will complete the registration of the trust in Nevis as required by the relevant authorities. The Trustee or the Registered Service Provider will complete and submit the relevant information and documents to the relevant authorities through a Registered Agent or a Service Provider authorized to deal with such matters.

The method and timing of registration will depend on the nature of the entity, trust, or company and the parties involved.  

7. Transfer Assets Into the Trust

Once documentation is complete, assets are transferred into the trust structure.

Typical assets may include:

• International investment portfolios
• Real estate holdings
• Company shares
• Intellectual property
• Financial accounts

Once the trust is established and all relevant documentation is complete, assets can be transferred to the trust as required. The transfer of assets will depend on the type of asset and its location worldwide. 

Required Nevis Trust Documents

Creating an offshore trust in Nevis requires establishing several essential legal documents. Each document describes how the offshore trust will operate and ensures the settlor complies with all applicable laws and regulations.

These documents provide for the smooth operation of your offshore trust. For example, although the letter of wishes is not legally binding, it can still guide the trustee(s) on how the settlor would like them to manage the trust’s assets.

Legal Requirements Under Nevis Trust Law 

Legal requirements for Nevis trusts are contained within a specific trust. The legal requirements of a trust are dependent upon several factors. These include information concerning the trustee(s) of the trust and other individuals who may be involved with the trust and its assets. Settlors and the beneficiaries of a trust are also of significance. Most importantly, laws of jurisdictions where assets of a trust are located as well as laws of jurisdictions where settlors and/or beneficiaries reside must also be considered. The following information serves as a general guide for establishing a Nevis trust. Consequently, this information must NOT be used for purposes of obtaining legal advice nor for tax advice. A Nevis trust is established with the assistance of a licensed Nevis trustee. However, the advice of attorneys and tax advisors from around the world must also be obtained. 

Why Nevis Is a Leading Jurisdiction for Offshore Trust Formation

Nevis is fast becoming one of the world’s leading jurisdictions for the formation of offshore trusts due to the country’s very favorable trust legislation and its active support of all international financial activities conducted within its jurisdiction.

This is because Nevis has established itself as the number 1 jurisdiction worldwide for establishing offshore trusts (refer to TBA Associates and Nevis trust overview). The jurisdiction offers a combination of asset protection and flexibility offered by its legislation, which makes Nevis the ideal jurisdiction for anyone wishing to efficiently structure their wealth.

The main reasons to set up a Nevis trust.

• Protection of assets from creditors
• Confidentiality regarding trust administration
• Professional management of assets by trustees
• Support for international estate planning
• Long-term administration of assets

Nevis offshore trusts are fast becoming the preferred method of wealth management for high net worth individuals from around the world. They offer a means by which individuals can preserve their wealth for long periods of time and manage their worldwide assets effectively.

This is particularly relevant where an asset owner becomes incapacitated or dies. In these circumstances a trust can provide a suitable structure to manage an individual’s assets on an ongoing basis in a number of jurisdictions around the world.

The choice of a trust structure will depend on a number of factors, including the objectives of the settlor, the nature of the assets and their location, the beneficiaries, and the laws of the country where the settlor is resident. 

Timeline for Setting Up a Nevis Offshore Trust

Setting up a Nevis trust as a simple entity can take a few weeks to set up. However, including all necessary documents for a simple structure, it will take around 2-3 weeks. More complex structures of entities and assets to be transferred will require a lot more time and also a lot of due diligence. In addition, opening bank accounts worldwide will take a lot of time and is part of setting up a Nevis trust.

Types of Assets Commonly Placed in Nevis Offshore Trusts

Offshore trusts can hold a wide variety of assets. Some examples are:

• International investment portfolios;
• Equity ownership in foreign-based companies;
• Foreign real estate holdings;
• Rights to international intellectual property;
• Assets allocated in bank or investment accounts and funds;

Offshore trusts in Nevis can be used for managing internationally held assets and for making investments worldwide for international wealth management.

Depending on the terms of a trust and the powers granted to a trustee, a wide variety of assets can be placed under the management and control of a trustee for the benefit of a trust. Assets such as interests in private companies, in partnerships, in precious metals, artworks, collectibles, in loans and receivables, and in some cases even in digital assets can be managed by a trustee for the benefit of a trust. It is wise to discuss with the proposed trustee what can be accepted and managed for the benefit of a trust.

Real estate, however, situated outside of Nevis, is subject to the laws of the foreign country where such property is located, even though such property may be held by a Nevis trust and managed by a Nevis trustee. 

Nevis Trust Cost Considerations

The costs associated with trusts in Nevis are another important factor to consider.

Several factors affect the expenses for setting up a trust in Nevis.

• The complexity of your selected structure
• The value of the assets to be included in the trust
• The specific trustee services you require
• The extent of compliance and legal documentation needed.

Costs for lower- to mid-level needs can range in the hundreds of thousands of dollars, and for higher-end needs can range in the six figures plus, depending on the specific needs of the client and the ongoing administrative fees for the continued management of the trust structure.

This trust cost analysis for Nevis trusts sets out the detail for each of the points outlined above. 

Example Scenario: Using a Nevis Offshore Trust

Assuming that you have a number of assets worldwide (e.g., companies, investment accounts worldwide, overseas properties, etc.), the example above will highlight how you can manage your assets while trying to protect your legacy for future generations.

Managing your increasing assets whilst protecting your family’s legacy for future generations can become a complex task as your business grows and your assets are distributed worldwide.

Long-term management and protection of your family’s wealth could be managed through the establishment of a Nevis Offshore Trust. The trust could hold, for example, shares of companies that you are involved with, investment accounts, and overseas properties.

• Shares of companies
• Portfolios of investments
• Properties situated outside your country of domicile

A qualified trustee (e.g., a professional trustee) is appointed by the settlor to manage the trust and its assets in accordance with the terms of the trust deed.

A trust is still operational and manages the assets of a settlor if the settlor, for whatever reason, is no longer in a position to manage his/her affairs due to illness or injury. A professional trustee will take care of the assets of the settlor and will distribute these to the beneficiaries as stipulated in the terms and conditions of the trust as outlined in the trust deed.

Comparison: Nevis vs Other Offshore Trust Jurisdictions

There are several popular jurisdictions where you can set up offshore trusts, and each comes with its own strengths.

Among these jurisdictions, Nevis offshore trusts are often regarded as particularly strong in asset protection.

Summary

The formation of a Nevis Trust is more than the preparation of a trust deed. It is necessary to define the objectives of the trust and to appoint one or more trustee(s) and to complete the KYC/due diligence information in respect thereof. Thereafter, relevant documents need to be prepared and signed by the parties involved. Finally, where necessary, registration of the trust and transfer of assets to the trust need to be completed.

Letters of Wishes and asset transfer records are generally required for the setup and ongoing management of an offshore trust. Offshore trusts are frequently used, as they offer asset protection, enable assets to be managed professionally, and are well able to deal with complex global family structures and all associated wealth considerations.

FAQ