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Open a Trust in Luxembourg
Updated on Wednesday 15th March 2023 Rate this article
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Investors who open a trust in Luxembourg benefit from a stable legal and regulatory environment, a favorable tax system, and a well-established financial services industry. To set up a trust or company in Luxembourg, you will need to engage the services of our qualified legal team, who can guide you through the entire process.
Components of a trust in Luxembourg
A trust is a legal arrangement in which one person, known as the settlor, transfers assets such as property, investments, or cash to another person, known as the trustee. The trustee holds and manages these assets on behalf of a third party, known as the beneficiary. The terms of the trust are set out in a legal document called a trust deed, which outlines the rights and obligations of the parties involved.
In Luxembourg, a trust can be formed under the Law of 27 July 2003 (the "Trusts Law") on trusts and fiduciary contracts. To open a trust in Luxembourg, the settlor must provide a written trust instrument, which outlines the terms of the trust and sets out the rights and obligations of the parties involved.
The trustee must be a legal person, such as a bank, trust company in Luxembourg, or other authorized financial institution, and must be approved by the country’s supervisory authority, the Commission de Surveillance du Secteur Financier (CSSF).
It is important to seek professional advice to ensure that the trust is structured appropriately and in compliance with all legal and regulatory requirements. For more details about opening a trust in Luxembourg, and also for company incorporation in Luxembourg, please contact our legal specialists.
Setting up a trust for a company in Luxembourg
Setting up a trust for a company in Luxembourg is a common use case for trusts in the country. This can provide a number of benefits, such as asset protection, succession planning, and tax optimization.
A company can establish a trust in Luxembourg by transferring assets to a trustee, who will manage them on behalf of the firm and its beneficiaries. The trust will be governed by a trust instrument, which sets out the terms and conditions of the trust, including the rights and obligations of the parties involved.
The administration and opening of a trust for a company in Luxembourg can be complex. Our team will provide professional advice and guidance if you are interested in learning more about the process.
Requirements for opening a trust in Luxembourg
To open a trust in Luxembourg, certain requirements must be met. This include:
- - Assigning the settlor, trustee, and beneficiaries;
- - The terms of the trust must be set out in a written trust instrument, which must be executed by the settlor and the trustee. The trust instrument must include the trustee's name and address, the trust's purpose, the rights and obligations of the parties involved, and the trust's governing law.
- - Assigning the assets, which can be can be cash, securities, real estate, or any other type of property, but they must be identifiable and capable of being transferred to the trustee.
- - Assigning the duration of the trust, which can be up to 100 years under the Luxembourg law.
Compared to the requirements for opening a company, the requirements for setting up a trust in Luxembourg are relatively straightforward.
In addition to legal and regulatory compliance, there may be tax implications associated with the formation and administration of a trust in Luxembourg. A qualified accountant in Luxembourgcan provide advice on tax planning and optimization and can help ensure that the trust is structured in a tax-efficient manner.
Contact our team for accounting services and legal advice for opening a trust in Luxembourg, as well as for other matters such as setting up a company in Luxembourg.
Meet us in Luxembourg
Contact our specialists in company formation in Luxembourg, who have a large experience in finance and international business.
Set up an appointment with us at +352 671 533 922. Alternatively you can incorporate your company without traveling to Luxembourg.
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As a BridgeWest partner for many years, CompanyFormationLuxembourg.com is for sure a great choice when wanting to start a business in this important financial hub. International entrepreneurs can rely on the professionalism of this team.
Vlad Cuc, Director of BridgeWest www.bridgewest.eu
Read more testimonialsVlad Cuc, Director of BridgeWest www.bridgewest.eu