Legal Framework And Formation Rules and Fees
Trust management has been a significant activity for Bermuda for more than fifty years. Originally the main sources of trust business were the UK, the USA and Canada, but more recently other parts of the world have become increasingly important, as understanding of the trust concept has spread more widely. Successive tightenings of anti-avoidance legislation in the traditional markets have also tended to reduce volume.
Bermuda has kept up to date with international trust practice but has been cautious about asset protection trusts, and the Bermudan legislation has attempted to draw a sustainable balance between the interest of the settlor and the creditor, rather than going all out for protection like many jurisdictions.
Bermudan trusts have traditionally been governed by The Trustee Act 1975 which is largely based on the English Trustee Act 1925. The Trusts (Special Provisions) Act 1989, another significant statute, introduced the concept of the "purpose trust" and brought Bermudan law still closer to English law. The Perpetuities and Accumulations Act 1989 increased the perpetuity period to 100 years. Foreign inheritance laws are specifically excluded, and there is provision for the non-recognition of foreign judgements.
Bermuda has adopted the Hague Convention; the Trusts (Special Provisions) Act 1989 made some consequent adjustments to the law. Appeal is to the English Privy Council.
In general, trustees need not be resident in Bermuda; but one must be. The trust fund may comprise cash, land, securities, interests in property or other trusts. Non resident trusts are not permitted to hold Bermuda currency, shares or security in local companies, or an interest in land in Bermuda without the prior consent of the Bermuda Monetary Authority.
Bermuda Discusses Rental Tax Proposal, Tax Data Exchange Tuesday 12/2/2019Bermuda's Government has stated that proposals for a rental income tax, detailed in a pre-budget report, were released as part of a consultation exercise and that the proposal for the levy has not been confirmed or formally announced. A decision on whether to include the measure in the Budget will be revealed when it is presented to parliament on February 22, 2019, it said.