The concept and purpose of trust structures are generally described, rated and classified according to their purpose. There are, among others, administrative trusts, investment trusts, real estate trusts, financial trusts and others. They can also be classified according to whether the fiduciary is general or financial, and according to the assets classified as fiduciary assets, general or private. Below we’ll look at how to get trust license Luxembourg, and the main aspects of this process.
Our team is highly-professional experts subject matter experts in the field of establishing and licensing commercial structures. We are focused on providing professional trust services Luxembourg and achieving the most effective results for you in the long term. Our company is ready to offer you options for ready-made trusts for sale around the world.
Trusts in Luxembourg: general regulation and licensing
As part of the new Luxembourg trust law, two new registers have been created in Luxembourg to maintain and provide information on the beneficial owners of organizations intending to spread Luxembourg trust services.
The first is the Register of Ultimate Beneficiaries. Local trusts must comply with the following obligations and may be subject to a fine from €1,250 to €1,250,000 if they fail to comply with the following:
- obtain and maintain beneficial ownership information at its registered office (companies are required to retain such records for 5 years after dissolution or at the end of the entity’s existence);
- provide information about its legal owners and beneficiaries to national authorities (upon request), self-regulatory bodies overseeing compliance with obligations to prevent illicit circulation of funds, as well as authorized persons when conducting due diligence of the client.
The second is the Register of Trusts. Luxembourg trusts must comply with the following obligations:
- obtain and maintain at their registered office information regarding the beneficial ownership of trusts in which they act as trustees. The information includes the identities of the following people: the grantor, the fiduciary, the person acting as the protective party, the beneficiaries (if beneficiaries are identified by characteristics or categories, the fiduciary must obtain sufficient information to be able to identify the beneficiaries at the time of distribution or at the time when the beneficiaries exercise their acquired rights), any other person who exercises effective control over the trust. If the entities mentioned above are legal entities, the fiduciary must collect the same information as the beneficial owners of the legal entities;
- provide information to national authorities upon request (identity of persons referred to above and trust registration number).
The trustees have a period of 6 months after the entry into force of the law to fulfill the above obligations. Access to the trust register is limited to national authorities. Our lawyers will help you establish this type of structure in this jurisdiction, license it and enter the necessary data into the relevant registers. As part of the acquisition of a ready-made business, we can offer you a trust company in Hong Kong for sale, trusts in Estonia, Lithuania, Germany, Denmark and other countries.
Thus, how to get trust license in Luxembourg? Entrepreneurs must register with the above-mentioned registers as a provider of services for the custody, management and distribution of client funds. An application for a permit can be submitted:
- in electronic form, through an electronic register;
- personally in direct interaction with authorized representatives of the regulator.
Inframes of trust license requirements Luxembourg, potential licensee needs next-mentioned documents.
- Registration form in the register of service providers of this type.
- Confirmation of the establishment of a local company and the opening of a corporate bank account.
- A suitability assessment form for the applicant legal entity and each of the individuals effectively managing the entity, signed by each of them.
- The firm’s internal anti-money trafficking and terrorist financing policies and guidelines and protocols in this regard.
- Filled form for trust license application Luxembourg.
- Business plan and risk analysis.
Trust license fees Luxembourg are approx. 15 thousand EUR. Regarding the taxation of these structures, it is worth noting that if at the time of payment of the tax the identity of the trustee is still not indicated in the registers and is unknown, he/she will be taxed as a foreigner, which implies a significant increase in the amount. If the trustee is known at the time of payment of the tax and can use the clients’ assets as he/she sees fit in accordance with the agreement, the tax will be paid when the trustee disposes of the assets using the necessary strategies.
Advantages of a trust license in Luxembourg
This is a small country with huge potential. Luxembourg has a stable and innovative economy, as well as a strong and supportive legal framework that encourages foreign investors and allows foreign entrepreneurs to enjoy the same rights as local ones. In Europe, it is favored by its geographical location, as well as its participation in the creation and functioning of the European Union.
The most important characteristics that make it attractive for investors to obtain trust license Luxembourg are:
- stable economy and good GDP indicators;
- excellent location in Europe, providing good transport links;
- multilingual workforce and good business environment: the country has three recognized languages: Luxembourgish, French and German;
- good taxation and legal framework for investment;
- good infrastructure: transport, development and ICT structures;
- good quality of life;
- relatively simple and straightforward process for establishing and registering a trust.
For the grantor, Luxembourg funds offer several valuable benefits, such as tax exemption on dividends, capital gains and wealth. This is an excellent tool for protecting the privacy of personal data. Although a gift tax may be imposed to maintain the integrity of the trust, government agents and trust managers aim to manage the assets as efficiently as possible. In addition, as a donor, the client has broad powers and capabilities to manage his/her own funds.
Our lawyers know all the intricacies and nuances of the process of opening a trust in Luxembourg and other jurisdictions. Trust license cost Luxembourg is always calculated individually based on plenty of surrounding factors. We are ready to become your reliable allies on the path of your commercial development. Contact us right now and entrust your business to our skillful hands.