Employee Benefit Trusts (EBT) have developed primarily as a way of motivating employees by providing performance related benefits from a pool of funds made available by the employer company to a trust for that purpose.

Guernsey companies are governed principally by the Companies (Guernsey) Law, 2008 (“the 2008 Law”), which came into force on 1 July 2008. One of the many developments introduced by the 2008 Law was a complete overhaul of the rules governing the declaration of dividends and the making of distributions.

An overview of GTC and our services.

While there is no legal requirements for the Trustee of a Guernsey Trust to be resident, it is most often necessary that they be located outside of any higher-tax jurisdiction to avoid the risk of the Trust itself becoming liable to tax there.

The continuing globalisation of private and institutional wealth is driving the development and expansion of financial services. Careful consideration of where to base your or your clients’ structures is more important than ever.

For those clients who wish to establish a local or international pension plan, Guernsey Trust Company (“GTC”) can offer services as Trustee.

There has been an explosion of entrants to the ranks of the super or ultra wealthy in recent years. Members of wealthy families are mobile and base themselves in diverse jurisdictions. The continuing globalisation of private and institutional wealth is driving the development and expansion of financial services and careful consideration as to where to base your or your clients’ structures is more important than ever.

In order to be valid a traditional trust is required to comply with what are known as ‘the three certainties’, Certainty of Intention, Certainty of Subject and Certainty of Objects .

While Trusts have been in existence since medieval times, they tend to be less well understood than corporate structures and some of the terminology used can be confusing for those who are not dealing with them on a regular basis. It is fair to say that even for individuals who may have been involved with corporate structures throughout their working lives, the creation of or involvement with more than one trust is rare.

The coming into force of The Companies (Guernsey) Law, 2008 (the 2008 Law) on 1 July 2008 brought with it a significant change to the types of company that still require a statutory audit and also a wholly different process for adopting the extended exemptions from audit now allowed. While the number of companies that can now qualify for audit exemption is increased, the process for ensuring that exemption is properly taken up is rather complicated and there is a much increased potential for missing critical filing deadlines if care is not taken.

The Channel Islands Stock Exchange (CISX), which is based in Guernsey, commenced operations in October 1998, since when it has approved over 4,000 securities for listing with a total market capitalisation of over US$ 50 billion. The CISX offers a highly personalised approach and fast track processing of listing applications within a well regulated and innovative marketplace.

The introduction of the Companies (Guernsey) Law, 2008 on 1st July 2008 changed the types of company requiring a statutory audit. Under the previous law the only companies that could opt to be exempt from audit were generally those that were either dormant or purely asset holding. Any company not eligible for or opting against audit exemption was required to submit to an annual audit of its financial statements. To reduce the need for costly statutory audits, the scope for audit exemption under the law was significantly increased.

The location of management and control of a company will often be a crucial factor in deciding that company’s tax residence. Having directors (or those whose directions are habitually followed by the director) located in a high tax jurisdiction can negate many tax planning benefits.

A Special Purpose Vehicle (“SPV”) is a term applied to a wide range of companies, formed for the specific purpose of entering into a financial transaction or series of linked transactions, often as part of a financial restructuring within a multi-national group of companies, for securitisation of assets or liabilities or for tax-efficient structuring of a transaction.