Introduction
Cyprus has established itself as a favorable jurisdiction for international trusts, offering a robust legal framework, including benefits such as, tax efficiency, and high levels of asset protection. The Cyprus International Trust (CIT) is widely used by high-net-worth individuals (HNWIs), family offices, and multinational corporations looking for wealth management, tax planning, and succession planning. CITs are a preferred tool for international investors, while offering confidentiality, flexibility, and strong legal protections.
What is a Cyprus International Trust?
A Cyprus International Trust (CIT) is a trust governed by Cypriot law, specifically designed for non-residents. To qualify as a CIT:
- The settlor (creator of the trust) must be a non-resident of Cyprus at the time of trust creation.
- The beneficiaries must also be non-residents (except for charitable trusts).
- At least one trustee must be a Cyprus resident.
CITs allow individuals and corporations to hold and manage assets securely, offering financial privacy, estate planning advantages, and international tax benefits.
Key Benefits of a Cyprus International Trust
Tax Advantages
- Exemption from Cyprus Taxes – No income tax, capital gains tax, or estate duty on trust assets outside Cyprus.
- No Withholding Tax – Beneficiaries receiving distributions from the trust do not face withholding tax in Cyprus.
- Double Tax Treaty Benefits – Access to Cyprus' extensive network of double taxation agreements (DTAs) may provide additional tax efficiencies.
- Confidentiality – No Public Disclosure – Trust details are not publicly accessible, ensuring high levels of confidentiality.
- Strong Asset Protection – CITs offer protection from forced heirship rules, safeguarding assets from legal claims.
- Estate & Succession Planning – Allows multi-generational wealth transfers without the complexities of probate. Beneficiaries can receive distributions according to specific conditions set by the settlor.
Legal Framework & Compliance
The Cyprus International Trusts Law (Cap. 224), modernized in 1992 and further updated in 2012, strengthens Cyprus' position as a top jurisdiction for trusts.
Key legal highlights:
- Perpetuity – CITs can last indefinitely, unlike many jurisdictions that impose a limited trust lifespan.
- Governance Clarity – Trustees must act in good faith and in the best interests of beneficiaries, adhering to Cyprus' regulatory framework.
- Legal Security – Cyprus courts recognize and enforce trust structures, offering strong legal certainty for international clients.
Legal assistance is essential to ensure full compliance with tax regulations, trust registration requirements, and beneficiary rights.
Eurofast's Expertise in Cyprus International Trusts
At Eurofast, we specialize in setting up and managing Cyprus International Trusts, ensuring full regulatory compliance while optimizing tax efficiency and asset protection.
- Expert Guidance – Our specialists navigate the legal and tax complexities of international trusts.
- Tailored Trust Solutions – We structure customized trust strategies aligned with your financial goals.
- End-to-End Services – From trust formation and administration to compliance and restructuring, we provide comprehensive 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.
