Jersey Private Trust Companies and Foundations: Bringing Order to Your Ambitions

Quick guide

Private Trust Companies and Private Trust Foundations are an effective and flexible alternative for large, multi-generational families with complex assets in multiple jurisdictions.

 

Issues and vulnerabilities

You’re a high net worth individual or family with multiple asset types in multi jurisdictions. But how cohesive is the oversight of these assets? And do you have an overarching succession plan?

Without a well thought out and organised plan, you may be susceptible to a number of vulnerabilities and issues.

• Disputes and litigation. Unclear instructions lead to disagreements which can be costly and damaging.
• Intestacy laws and unintended heirs. May have unintended consequences such as asset fragmentation and unintended beneficiaries.
• Probate delays and expenses. Can make assets inaccessible and cause cost and uncertainty for beneficiaries. Death duties and liquidity Weak succession plans risk incurring inflated taxes potentially forcing asset liquidations.
• Administrative paralysis.  Ineffective mechanisms for transferring authority stall decision making.
• Family business succession.Unclear succession plans can affect the continuity of family businesses and impact employee livelihoods.

Bringing order to your ambitions

Individually structured Private Trust Companies and Private Trust Foundations offer multiple solutions to mitigate these issues and bring order to your (family’s) affairs.

They offer several advantages over a third-party trustee:

• Greater control protects your long-term objectives and family values.
• Additional flexibility from not being bound by regulated trust company internal policies.
• Consolidated ownership for multiple family trusts.
• Ability to give decision making rights to your chosen family members and advisors.
• Board structures can be changed as situations evolve and the next generation can be actively involved.
• Testamentary freedom follows the wishes of the settlor.
• Avoids probate and asset fragmentation, ensuring control remains in the family.
• Philanthropy interests and objectives can be included.
• Robust governance in a well-regulated, politically stable jurisdiction.

Retaining control

The main appeal of PTC and PTF structures is the ability for clients and their family members, family office representatives and advisors to retain legitimate control at different levels.

• Director of the PTC or Council member of the PTF.
• Control the composition of the PTC board or PTC council in the constitutional documents.
• Protector of the designated trust(s).
• Enforcer of the purpose trust which owns the PTC.
• Member of any Protector Committee or Enforcer Committee.
• Member of any Advisory or Investment Committee.
• Member of a Family Council.

It may seem appealing to clients to incorporate all the control mechanisms, however, this is not advised.

VG your expert partner

VG is highly knowledgeable and proficient in the use of PTC and PTF structures and we actively manage them for numerous international clients and their families.

We ensure a client’s PTC or PTF is legally sound and robust, giving careful thought and consideration to a range of factors including:

• Management and control
• Constitutional documentation
• Taxation
• Governance
• Disclosure requirements
• Economic substance
• Exchange of information
• Privacy
• Schedule 2 obligations

 

Explore how PTCs and PTFs could benefit you or your client.

Contact Debbie Lumsden, Director, Private Wealth.