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Article by Costas Mavrocordatos, Nicos
Chimarides, Spyros Evangelou and Lambros
Kilaniotis
Amendment Of The Cyprus International Trusts Law
Last week a new Law amending the Cyprus International Trusts Law
was introduced. The Law has been published in the Gazette and came
into force today, Friday 23 of March 2012.
The new Law builds on the existing very attractive Cyprus
International Trusts Law and has introduced many new features. The
most important of these new features are summarised below:
The settlor and the beneficiaries or any of them of a Cyprus
International Trust ("CIT") may become resident in
Cyprus.
All questions in relation to a CIT will be governed by Cyprus
Law and Cyprus Courts will have jurisdiction.
The principle of settlor reservation of powers is greatly
enlarged and is being codified in the new Law. The settlor of a CIT
may retain or vest in the protector or enforcer of a CIT very wide
powers including powers in respect of revocation or amendment of
the CIT, distribution, sale, transfer disposal or charge of the
trust property and substitution of the trustees. These and other of
the powers expressly provided in the new Law, allow the settlor (or
the protector of a CIT) to exercise a greater degree of control
over the administration of the CIT.
Real Estate situated to Cyprus may be the subject matter of the
CIT.
The new Law applies to new and existing CITs.
The new Law, which became effective upon its publication in the
Gazette, enhances the position of Cyprus as one of the most
attractive jurisdictions worldwide to set up and operate an
International Trust.
Tax Status
Cyprus tax resident beneficiaries to a CIT are subject to
taxation in Cyprus on the worldwide income and profits generated by
the CIT.
Non-Cyprus tax resident beneficiaries are subject to taxation in
Cyprus only on Cyprus-sourced income and profits generated by the
CIT, where applicable by the tax legislation.
Way forward: how PwC can help you
Our teams are ready to discuss the above developments with you
and offer our support.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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