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Offshore Trusts Report: British Virgin Islands

Legal Framework and Formation Rules

BVI Trusts are formed under the Trust Ordinance 1961 (based on the English Trustee Act 1925), as updated and amended by the Trustee Amendment Act 1993, and the subsequent Trustee Amendment Act, 2003. Since the 1993 Act, there is no requirement for registration of trusts in the BVI, and there is no public disclosure of information regarding trusts. Trust duty is payable on each trust instrument, which is achieved by buying and affixing stamps, creating no record.

BVI trusts are exempt from all taxation provided that there is no resident beneficiary and no BVI assets.

Due to the Amendment Act, the regime for trusts in the BVI is very flexible. The following are some of the main features of BVI trust law:

  • the proper law of a trust can be specified by the trust instrument; in the absence of a specified jurisdiction, a trust will be under BVI legislation if the trustee or the trust administration is situated in the BVI;

  • trusts can migrate into and out of the BVI; but outwards migration is only possible if the 'receiving' jurisdiction recognizes the validity of the trust;

  • purpose trusts are permitted in perpetuity and must have at least one BVI trustee (resident professional or equivalent);

  • the perpetuity period can be set at 100 years, but 'lives in being' is still possible;

  • 'wait and see' provisions are included as standard;

  • 'protectors' are explicitly permitted, and their powers are clearly defined;

  • forced heirship provisions are excluded;

  • trustees may be given wide discretionary investment powers.

The BVI's trust regime was substantially updated in 2004 with the following three pieces of legislation. In addition, new laws on private trust companies came into force on January 1, 2007.

The Report

Offshore Trusts Guide: Introduction

Offshore Trusts Guide: Jurisdictions

Bahamas Barbados Bermuda British Virgin Islands Cayman Islands Cook Islands Cyprus Gibraltar Guernsey Isle of Man Jersey Liechtenstein Madeira Malta Mauritius Monaco Nevis New Zealand Panama Seychelles Turks & Caicos Vanuatu


British Virgin Islands News

BVI To Review Taxes And Fees
Monday 15/3/2010
British Virgin Islands Prime Minister, Ralph O’Neal has said that the territory will run a budget surplus during 2010, although the government still intends to review indirect taxes and fees on financial services.

Caribbean Explores Fiscal Cooperation
Tuesday 9/3/2010
Ahead of the World Bank meeting, to be held on March 11-12, where CARICOM Finance Ministers will meet to discuss challenges that the region faces, CARICOM Secretary General, Edwin Carrington said it was vital for Caribbean economies to increase economic cooperation and remove fiscal barriers, for the prosperity of the region going forward.

China Clarifies Tax Treatment Of Corporate Income Earned Abroad
Wednesday 27/1/2010
The Chinese Ministry of Finance, acting through the State Administration of Taxation, has issued a Circular to clarify corporate income tax provisions with regard to income earned abroad.

OECD Reports On Its Progress With International Tax Standards
Wednesday 20/1/2010
According to the Organization for Economic Cooperation and Development, the focus of the Global Forum on Transparency and Exchange of Information is now shifting – from commitments and agreements to achieving an effective implementation of the standards.

UK's Wealthy Head For Sunnier Climes As Tax Storm Brews
Wednesday 16/12/2009
New research would appear to confirm that, while not quite the 'exodus' popularly characterized in the press, there is nevertheless a steady stream of wealthy financiers, entrepreneurs and bankers leaving Britain as a result of the Labour government's recent tax increases.

BVI Signs TIEAs With China And Ireland
Wednesday 9/12/2009
The government of the British Virgin Islands took a further step on December 7 to conclude Organization for Economic Cooperation and Development model Tax Information Exchange Agreements, signing texts with Ireland and China.

OECS States Agree Upon Draft Outline For New Treaty
Wednesday 25/11/2009
The new Treaty of the Organisation of Eastern Caribbean States will be signed in the St. Kitts capital, Basseterre on December 29.

Crown Dependencies Welcome Foot Report Findings
Monday 2/11/2009
The British Crown Dependencies have welcomed the findings of the UK government's review of the dependencies, published on October 29, which recognizes their economic benefit to the United Kingdom, and efforts to achieve compliance with international standards.

BVI Makes OECD White List
Monday 17/8/2009
The British Virgin Islands has signed its 12th Tax Information Exchange Agreement after concluding an agreement with New Zealand, meaning that the jurisdiction is now considered to be "substantially" in compliance with the Organization of Economic Cooperation and Development's tax snoopers' standard.

BVI Signs OECD Model Agreements With Nordic States
Wednesday 20/5/2009
The British Virgin Islands government announced this week the signing of bilateral tax information exchange agreements with the six Nordic countries, the Faroe Islands, Finland, Greenland, Iceland, Norway and Sweden at the Icelandic Embassy in Copenhagen, Denmark, on May 18.