Strongest Asset Protection Structure in the World: Nevis LLC & Cook Islands Trust w/ Swiss Offshore Account
- Last updated on . Written by Offshore Protection.
When it comes to asset protection, few financial tools can rival a Cook Islands Asset Protection Trust. These trusts provide unparalleled asset protection, privacy, as well as a hindrance to anyone foolish enough to try and bring a lawsuit your way. The best way to secure your assets and protect your financial well-being is to have a comprehensive strategy with multiple vehicles complementing each other.
This is where you can enhance your asset protection plan by using a Nevis LLC in conjunction with a Cook Islands Trust. To add a third piece to the puzzle we use an Offshore Swiss Bank Account that is held by the LLC. We believe that this unique multi-jurisdictional approach that combines some of the world's strongest asset protection mechanisms (Cook Islands), together with a fiercely pro-business country (Nevis) together with the iron-clad banking secrecy laws of Switzerland make this a structure worth talking about.
In this article, we will explore some of the key features of all three of these powerful offshore financial tools, and how they can work perfectly together to bring you greater financial security, control, and privacy.
Table of Contents:
- Cook Islands Offshore Asset Protection Trust
- Breaking Down An Asset Protection Trust
- Differences Between A Domestic Trust And An Offshore Trust?
- Why You Need a Cook Islands Trust
- Nevis LLC with a Cook Islands Trust for Additional Asset Protection
- Why You Should Be Using An Offshore Limited Liability Company
- Why a Nevis LLC is the Best in its Class?
- How to Use a Nevis LLC with a Cook Islands Trust
- Using An Offshore Swiss Bank Account as a Final Piece of the Puzzle
Breaking Down an Asset Protection Trust: Cook Islands
An asset protection trust also known as an APT is a special type of irrevocable trust which allows the grantor/settlor (i.e., the creator of the trust) to simultaneously be the sole beneficiary of the trust.
This makes them ideal vehicles for asset protection, as it enables the grantor to relinquish legal ownership of their assets whilst still retaining the ultimate benefit and use of them. Their irrevocable nature means that the grantor cannot terminate or alter the terms of the trust once it has been created, and therefore courts have no claim over the assets in the trust.
All trusts consist of three parties:
- The grantor/settlor: The creator of the trust and the one who transfers ownership of assets into the trust),
- The trustee: The independent third party who is responsible for overseeing and managing the trust for its best interests),
- The beneficiary/ies: the one who ultimately benefits from the assets held within the trust.
The trustee plays an important role in an asset protection trust, as they are the intermediary third party that is responsible for managing and safeguarding the assets in the trust.
APTs can be set up in such a way that the grantor retains indirect control of the assets via the trustee, but if faced with a court order to use the assets in the trust to settle a debt or legal claim, the trustee can step in and protect the trust assets.
An offshore APT is simply an asset protection trust that is established in a foreign jurisdiction. These trusts have proven to provide significantly greater levels of security and privacy compared to domestic APTs.
This is because they are outside of the jurisdiction of local courts, and therefore offer an additional layer of protection. In addition, some offshore jurisdictions, such as Cook Islands and Nevis, have especially powerful regulation which protects the assets in an APT, and make it nearly impossible for an outside party to win a claim against them.
Why Cook Islands APT?
A Cook Islands Trust is by far the most popular jurisdiction in which to establish an asset protection trust, for good reason. It provides many important benefits, such as zero taxes, privacy, unparalleled protection, and flexibility. Some of its other advantages include:
- Cook Islands Trust Law requires any claims or lawsuits against a trust to be made within Cook Islands itself, meaning that it does not recognise foreign court rulings.
- The law is structured in such a way that there are significant obstacles to filing a successful claim against the assets held inside a trust.
- The assets held in a Cook Islands Trust are kept far out of reach of creditors and other threats.
- The assets do not have to be physically located in the Cook Islands.
- Trust deeds are not publicly registered, which means that the trust information remains private.
- A Cook Islands Trust offers access to new investment opportunities through the trust.
- The structure of the trust is flexible.
- There is a two-year statute of limitations for a creditor to make any claims against you or the trust, and these must be made from within the Cook Islands itself.
Nevis LLC with a Cook Islands Trust for Additional Asset Protection
A Cook Islands Trust is a powerful tool for asset protection in and of itself. However, to maximise the potential benefits, and ensure greater privacy, control, and security, it is advised to establish a Nevis LLC to be used alongside the trust.
We will explain exactly how this works, but first a brief overview of offshore LLC’s in general, and the specific benefits of a Nevis Offshore LLC.
Why You Should be Using an Offshore Limited Liability Company
An Offshore LLC is simply the term for a limited liability company which is established in a foreign jurisdiction, and usually does not directly conduct business activities within the jurisdiction in which it is established. Limited liability companies are popular financial vehicles, as they provide limited liability protection to their owners. This means that if the company is faced with a lawsuit, claimants cannot go after the owner’s personal assets (and vice versa).
Offshore LLC’s are especially powerful tools for asset protection, tax optimisation, and financial privacy. This is because it creates a separation between you and your assets, is a pass through tax entity, is located in a separate country outside of where you live (in a country that has strong financial secrecy laws) - all of which gives you greater protection, security and privacy.
Why a Nevis LLC is the Best in its Class?
Nevis is by far one of the best jurisdictions in which to incorporate an offshore LLC. A Nevis LLC provides all of the standard benefits of an LLC, along with some additional advantages which are unique to the jurisdiction. Some of the major benefits include:
- Asset Protection: Like all LLCs, a Nevis LLC provides standard limited liability protection to its owners. In addition, Nevis corporate regulations are especially protective to company owners. There are no shares which can be attached by a court of law. Nevis courts also do not recognise foreign court orders, so any claimant will have to file a case in Nevis itself, which adds an additional layer of protection.
- Privacy: A Nevis LLC provides its owners with complete anonymity. The identifies of beneficial owners are not publicly available nor registered anywhere. Nevis is renowned for its strict privacy laws, whereby it is a crime to disclose the identities of company owners without authorisation.
- Tax-Free Jurisdiction: Nevis is well-known as a tax haven. Offshore LLCs can enjoy zero taxes on dividends, income, capital distributions, and undistributed earnings.
- Flexible ownership requirements: Nevis LLCs have highly flexible and favourable ownership requirements. There is no limitation on the number of members, and 100% foreign ownership is permitted. Nominee ownership is also possible for greater privacy.
- Fast and easy incorporation: The incorporation process is straightforward, affordable, and can be completed in as little as 24 hours.
How to Use a Nevis LLC with a Cook Islands Trust
A Nevis LLC is the ultimate compliment to a Cook Islands Trust, as it provides additional protection, flexibility, and control. The way it works in practice is as follows:
- Establish a Cook Islands Trust and transfer the assets you wish to be safeguarded. Cook Islands Trusts are irrevocable asset protection trusts, meaning you will be both the grantor of the trust and the beneficiary, without actually owning any of the assets. The trustee acts as a trusted middleman to protect the assets in the trust.
- Incorporate a Nevis LLC which is 100% owned by the Cook Islands Trust, with you (the grantor) appointed as manager. One inherent issue with an irrevocable trust is that it gives you very little direct control over the assets which are held in the trust during its lifetime. A Nevis LLC helps to overcome this problem. The trust assets will be controlled by the LLC, with you as manager. This gives you a great deal of flexibility and oversight, without the risk of direct ownership. As soon as a legal issue arises where you are personally liable, the trustee can step in to protect the assets in the trust and temporarily remove you as the manager of the LLC until the case is resolved.
This type of structure is the best way to protect your assets and, if established well before any problems arise, will avoid the issue of fraudulent conveyance. This is because the trustee simply has to temporarily remove you as manager of the LLC to protect the assets, and so you will not need to make any dubious transfer of assets after you are faced with a liability claim.
The Final Piece of the Puzzle With a Swiss Account
While a Nevis LLC will control the majority of assets held by the trust, these assets need to be held somewhere safe. This is where the final piece of the puzzle comes in, an offshore Swiss bank account.
Swiss bank accounts are notorious for their safety and privacy, so where better to deposit your hard-earned wealth. In practice, the assets will be deposited/safeguarded in a Swiss bank account which is owned by the LLC (with you as manager), which is in turn owned by the Cook Islands Trust. This trio provides multiple layers of protection, whilst being able to benefit from the unique advantages of each of these tools.
Switzerland has long been one of the best countries for offshore banking. Some of the major benefits of a Swiss offshore bank account include:
- Safety and Stability: Swiss bank accounts are one of the safest in the world. The economy is robust, there is a stable political environment, and the banking sector is highly sophisticated. Swiss banking regulations require banks to hold high capital reserve ratios which serve to protect depositors’ funds.
- Tax: Offshore bank account holders can enjoy high levels of tax efficiency, with low capital gains and income tax on investment and interest returns.
- Investment Opportunities: Swiss banks offer access to top quality investment opportunities for wealthy account holders who decide to open an investment account. They enable you to hold multiple currencies in the same account which provides increased diversification and flexibility.
- Efficiency and Service: Swiss banks are among the best in the world in terms of their efficiency and high-quality customer service.
- Privacy: In decades past, the infamous Swiss numbered bank account was the epitome of confidentiality and anonymity. New information sharing treaties and worldwide anti-money laundering have eliminated the possibility for complete anonymity. Swiss numbered bank accounts do still exist, but the identity of the account holder must be linked to the account. That being said, there is still a culture of privacy among Swiss banks, and even the identities of account holders are kept highly confidential unless in extremely rare cases or suspicion of criminal activity. Furthermore, owning a Swiss bank account via a Nevis LLC is as close to complete anonymity as you can expect to get in this day and age.
Some of the banks we work with are:
And more>> Swiss Offshore Banking
If you are looking for the ultimate asset protection strategy which ensures security, control, and access to new investment opportunities, then the combination of a Nevis LLC & Cook Islands Trust Package with Swiss bank account is the ideal choice. Each of these three financial tools complement each other perfectly to provide an integrated asset protection plan.
Due to the complex nature of a multi-tier strategy like this, it is definitely recommended that you enlist the services of an expert who can help structure it according to your specific needs and guide you through the process. It is also important that you act as soon as possible, as asset protection strategies are far more effective when established long before a crisis emerges. If you are scrambling to try to protect your assets after you are faced with a court case, the chances of being successful are greatly reduced.