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Nevis Asset Protection Strategies for High-Net-Worth Individuals



Nevis Asset Protection Strategies for High-Net-Worth Individuals

A tiny island in the Caribbean, Nevis is part of the Federation of Saint Kitts and Nevis. It is also one of the most attractive offshore jurisdictions for HNWIs. Willing to protect their assets from taxes, creditors, and lawsuits, they choose this tropical paradise jurisdiction for its legal structures and services that help HNWIs safeguard their wealth from prying eyes and enjoy related benefits. If you are new to offshore protection strategies, you may wonder what these are.

Territorial taxation: Nevis only taxes income derived from sources within Nevis, regardless of the taxpayer’s residency status. Income from foreign sources, including dividends, interest, royalties, capital gains, or services rendered abroad, is tax-exempt here.

Asset protection: Nevis has strong laws and regulations that protect the assets of your trust or LLC from any legal actions or claims initiated by creditors or claimants. Nevis does not recognize foreign judgments. To challenge the validity of a Nevis trust or LLC, a high bond combined with a high standard of proof is necessary. The jurisdiction boasts a short statute of limitations and does not allow any asset attachment, seizure, or distribution unless the corresponding trust deed or operating agreement expressly permits this.

Financial privacy: Except for a simple declaration of trust or certificate of formation, Nevis does not require any registration or filing of reports with the Nevis authorities. The names of beneficiaries, business owners, managers, trustees, and protectors are disclosed neither to the public nor to any foreign governments. Your trust deed, operating agreement, and financial statements are also confidential and protected by law in Nevis.

Flexibility: Nevis allows you to customize the terms and conditions of trust deeds or operating agreements according to your needs and goals. In Nevis, you can change or revoke your trust or LLC at any time, as long as your trustee, protector, members, or managers have consented thereto. You are also free to appoint yourself or a professional service provider to act as any of the above officials.

To simplify the matter for you, International Wealth experts will explore 2 of the most common and effective asset protection tools in Nevis: namely, the Nevis Trust and the Nevis LLC. We will explain how to combine them in a structure known as a Nevis Hybrid, which provides the maximum level of asset protection and control.

What is a Nevis trust?

A Nevis trust is a legal arrangement that allows you to transfer assets to a trustee, who holds and manages them for the benefit of yourself and/or other beneficiaries, as provided for under the trust deed. A Nevis trust is established under the Nevis International Exempt Trust Ordinance (NIETO), which was enacted in 1994 and amended in 2015 to enhance the asset protection features of Nevis trusts.

The latter can be used for estate planning, wealth preservation, tax planning, or charitable giving. A Nevis trust may also be an instrument to hold the shares of a Nevis LLC, creating a Nevis Hybrid structure, with its double asset protection layer.

What is a Nevis LLC?

It is no secret that high-net-worth individuals often use Limited Liability Companies (LLCs) for business and investment purposes. A Nevis LLC is a legal entity that combines the features of a corporation and a partnership. It is formed by filing simple articles of organization with the Nevis Registrar of Companies and paying a nominal annual fee. A Nevis LLC is governed by the Nevis Limited Liability Company Ordinance (NLLCO), which was enacted in 1995 and amended in 2015 to enhance the asset protection features of Nevis LLCs.

HNWIs turn to use Nevis LLCs for business operations, investment holding, or asset protection. A Nevis LLC can also be owned by a Nevis trust, creating a Nevis hybrid structure that provides a double layer of asset protection.

How to combine a Nevis trust and a Nevis LLC for maximum asset protection?

One of the most effective ways for HNWIs to use Nevis for asset protection is to combine a Nevis trust and a Nevis LLC in a structure known as a Nevis Hybrid. In this structure, you create a Nevis trust and transfer your assets to it. Then, you create a Nevis LLC and make the trust the sole member of the LLC. You can also appoint yourself as the manager of the LLC, or use a professional service provider to act as the manager. This way, you will enjoy the benefits of both the trust and the LLC:

  • Retain control over LLC assets as its manager, while the trust will provide the ultimate ownership and protection of the assets.
  • Avoid the risk of having a foreign trustee or manager who may act against your interests or become subject to foreign laws or claims.
  • Benefit from the double layer of asset protection, as a creditor would have to overcome the barriers of both the trust and the LLC to reach your assets.
  • Simplify the structure’s administration and taxation, as the trust and the LLC are treated as one entity for tax purposes, and only one annual fee is required.

Would you like to keep your hard-earned money safe from domestic and foreign issues? Setting up a strong protection plan in Nevis might be exactly the solution you need. By using offshore trusts, LLCs, and bank accounts in Nevis, you will lower the chances of legal troubles affecting your wealth.

To make your protection plan even better, apply for St. Kitts & Nevis citizenship. Not only does this option come with better travel opportunities but also gives you a second home to come back to should your old country become unstable or oppressive.

However, to work out a viable protection plan in Nevis, be prepared to do lots of careful thinking and research. A part of this strategy is having to pick the right trust, find the best bank, and figure out the most effective way to handle a company abroad. Luckily, the International Wealth team has already done it for you. To discover the best choices for you and your family, feel free to talk to our experts without further delay. Invest in your cloudless future now to secure peace of mind for years to come!