Mainland trusts are very different from offshore trusts, including those in Hong Kong, including registration systems, operating models, regulatory mechanisms, and flexibility in the use of trust assets.
It can be said that domestic trusts and overseas trusts have different styles, and it is even difficult to classify them together.
?Today I have sorted out the six major differences between them. If you want to know more about the establishment and structuring services of offshore trusts, please tell me!
Six major differences
- registration system:
- Domestic trust: It needs to be registered with relevant government departments, and the procedure is relatively complicated.
- offshore trust: Usually there is no need to register with the government department, and the establishment procedure is relatively simple.
- Operation mode:
- Domestic trust: Most are operated by domestic trust companies and are subject to domestic regulations.
- offshore trust: Usually operated by professional institutions in offshore financial centers, the operation is more flexible.
- regulatory mechanism:
- Domestic trust: Strictly supervised by the China Banking and Insurance Regulatory Commission and other institutions, with strong supervision.
- offshore trust: Supervised by local financial regulators, relatively flexible and diversified.
- Flexibility in using trust assets:
- Domestic trust: The use of assets is more restricted and less flexible.
- offshore trust: The use of assets is more flexible and diversified investments can be made.
- tax advantages:
- Domestic trust: There are relatively few tax preferential policies.
- offshore trust: In some offshore financial centers, trust assets can enjoy more tax benefits.
- Privacy protection:
- Domestic trust: Restricted by Chinese laws, privacy protection is relatively weak.
- offshore trust: It has strong legal protection in terms of privacy protection and can better protect the privacy of beneficiaries.
These differences make the establishment and operation of domestic trusts and offshore trusts very different. Only by choosing the appropriate trust type based on your own needs can you better achieve your wealth management and inheritance goals.
If you have more questions or need further information about the establishment and structuring services of offshore trusts, please feel free to contact us at any time!
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