At Maplebrook Services Ltd we have developed a great professional relationship with leading lawyers based in Paphos, Cyprus and we are now able to assist with setting up Cyprus Trusts.
Cyprus is a top choice for establishing trusts, thanks to its favourable legal framework. This makes it an excellent option for individuals who want to manage and distribute their estates effectively. One of the key benefits of setting up a trust in Cyprus is the ability it gives nationals from European Union countries, like Germany, the Netherlands, and Romania, to bypass their home countries' forced heirship rules. These rules often dictate how a person’s estate must be divided after their death, but a Cyprus trust allows individuals to distribute their assets according to their personal wishes instead.
What Are Forced Heirship Rules?
Forced heirship rules are laws found in many European countries that require a certain portion of a person’s estate to be left to close family members, such as spouses, children, or parents. These laws aim to protect the financial interests of family members and prevent individuals from disinheriting them completely.
For example, in Germany, the law requires that a portion of the estate, called the "Pflichtteil," be given to certain heirs, even if the deceased had other intentions. Similarly, in the Netherlands, forced heirship rules ensure that children and spouses receive a set portion of the estate.
While these rules serve to protect family members, they can also be restrictive. People with high-value estates, those living abroad, or those with complex family dynamics may find these laws limiting, as they might not align with their personal wishes for how their assets should be distributed. This can lead to outcomes such as the forced sale of assets or unintended beneficiaries receiving a portion of the estate.
The Benefits of Cyprus Trusts
Creating a trust in Cyprus offers a flexible and effective way to manage and distribute your estate, both during your lifetime and after your death. By transferring assets to a Cyprus trust, you can ensure that they are managed according to your specific instructions. This approach offers several benefits, including greater control over how your assets are distributed, enhanced privacy, and protection from creditors.
Cyprus trusts are governed by the Trustee Law Cap 193, which is based on principles from the English Trustee Act 1925. This legal framework ensures that trusts are managed according to well-established standards, providing clarity on the roles and responsibilities of trustees. By establishing a trust in Cyprus, individuals can bypass forced heirship rules, protect their assets, and potentially gain tax advantages.
The types of assets that can be placed in a Cyprus trust include real estate, bank accounts, investments, and other forms of property. This makes Cyprus trusts a versatile solution for comprehensive estate planning.
Conclusion
For nationals of countries with strict forced heirship rules, Cyprus trusts provide a valuable and flexible option for estate planning. By setting up a trust in Cyprus, individuals can have greater control over how their assets are distributed after their death, ensuring that their wishes are respected. Combined with the legal and tax benefits that Cyprus offers, these trusts are becoming an increasingly popular tool for those seeking to manage their estates efficiently and privately.
For further information or advice, please consult with a qualified Will Writer at Maplebrook Services Ltd. Contact us at +357 26600780 or email info@maplebrookservices.com.
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