Singapore to South Dakota: Navigating the Spectrum of International Trusts

Trusts provide an efficient and flexible way of controlling how and when assets are distributed to selected beneficiaries, often forming a central part of any succession planning.

The wide range of trust options available across different jurisdictions means that families can be highly selective when choosing ones that suit their particular requirements and take advantage of the spectrum of benefits that different Trusts offer.

Singapore, for example, which offers a stable political environment, resilient economy, and a legal system founded in English Common Law, continues to grow as an international wealth management hub for families. Trusts in this jurisdiction can be utilized for various purposes, such as estate planning, succession planning, asset protection, and wealth management.

The usual separation of legal and beneficial ownership that a Trust offers and using an irrevocable trust deed ensure that Singapore Trusts offer significant protection against legal claims and creditors. They also ensure protection from forced heirship.

Singapore does not levy estate duty or capital gains tax at all, while non-resident beneficiaries are not subject to income tax on distributions. The favorable tax treatment, international investment agreements, and other exemptions make the country an attractive destination for Trusts.

On the other side of the world, South Dakota Trusts share similarities with Singaporean Trusts, given their tax-efficient benefits. Like in Singapore, South Dakota doesn't have inheritance/estate duty, which adds to the appeal of Trusts domiciled there. Another similarity both jurisdictions share is the creditor and litigation protections on offer.

However, they do diverge. South Dakota takes its tax treatments further by not levying any income or state tax, whether resident or non-resident. Delegated Trusts also allow for significant flexibility for the settlor by creating committees that govern key aspects of the Trust. Another difference is that South Dakota Trusts can stand perpetually, a standout feature for ensuring legacy. Where most traditional jurisdictions have limits for how long they can exist, Trusts created in South Dakota can last forever. Combining this benefit with the power of compound interest and tax efficiency, the South Dakota Trust gives families limitless opportunities to pass down unrestricted generational wealth.

Further south in New Zealand, the country's international tax and company laws (including limited liability partnerships) make it an attractive jurisdiction for foreigners seeking effective tax and asset planning options. New Zealand offers competitive exemptions for foreign Trusts, where there are no capital gains taxes, and trust income isn't taxed provided the Trust's settlors and source of income aren't resident to the country.

On the European front, the UK offers a well-established trust environment, proving particularly beneficial for charitable Trusts, exempt from stamp duties, capital gains, income tax, and inheritance tax on all gifts into the Trust. Tax relief is also provided for donations into the Trust. Non-resident Trusts have significant tax exemptions compared to resident Trusts, which have significantly eroded their tax benefits in recent years.

How can Amicorp help?

At Amicorp, we recognize that there is no one-size-fits-all solution when it comes to Trusts, which is why besides all the jurisdictions already mentioned above, we also offer trust solutions in jurisdictions such as India, Mauritius, Barbados, Malta, Switzerland, The British Virgin Islands, and the Cayman Islands. We also offer other estate planning solutions, such as Foundations in Curaçao, Panama, Cayman Islands, United Arab Emirates (ADGM), and the Netherlands, as well as Fideicomisos in Argentina, Mexico, and Uruguay.

With a backdrop of constantly changing regulations, we also know that familial matters have grown more complex. Productive assets are often spread out over different countries that adhere to different rules and regulations, and families often have their own unique and intricate set of priorities, from asset protection, tax, or succession planning, to addressing concerns around health.

Amicorp is uniquely positioned to provide trust services to match different goals as an independent global service provider. Our team of experts can help support you and set up the right Trust to meet your particular needs. Contact our team here to find out how we can help you maintain your legacy.