DISCRETIONARY
Discretionary Trust
The most common format. The Trustee has broad discretion to distribute income and capital to beneficiaries. Letter of Wishes from the founder - gentle guidance.
Standard05 Trusts Act Privy Council
Cayman Trusts -
capital protection
for generations.
The Cayman Islands is one of the leading jurisdictions for trusts: modern legislation (Trusts Act, STAR Trust regime), specialized Financial Services Division of the Grand Court, appeals to the Privy Council. Asset protection, estate planning, charity.
Types of Trusts
Six modes -
under any scenario
From the classic discretionary trust to the unique STAR mode, Cayman offers the widest range of trust tools in the world. Each with its own advantages for specific tasks.
STAR TRUST
STAR Trust
Special Trusts (Alternative Regime). Unique regime: may have non-charitable purposes, and not only human beneficiaries. Used for orphan structures and special purposes.
UniqueRESERVED POWERS
Reserved Powers Trust
Settlor retains certain rights (investment, appointment of protector) without invalidating the trust. Under the Trusts Act 2008 amendment. Psychological bridge to trust planning.
Settlor controlEXEMPTED TRUST TEC
Exempted Trust
Can obtain a Tax Exemption Certificate (TEC) from Cabinet - a guarantee that any future Cayman Islands taxes will not apply to the trust. Duration: up to 50 years. Often used for Unit Trusts.
50 years TECPTC PRIVATE TRUST COMPANY
Private Trust Company
Not the trust itself, but the legal entity. a person who acts as a trustee for one or more family trusts. PTC, which conducts only “connected trust business”, is exempt from licensing requirements.
Family-controlFOUNDATION COMPANY
Foundation Company
A hybrid of a trust and a legal entity. Has legal personality, can own assets and enter into transactions. Beneficiaries are optional (purpose foundation). Used for DAO, charitable, orphan structures.
DAO F.O.STAR Trust in detail
Unique mode -
not only for people
The STAR Trust was introduced by the Special Trusts (Alternative Regime) Act 1997 and is now contained in Part VIII Trusts Act. This is the only regime in the world that allows the creation of non-charitable purpose trusts - trusts for specific purposes, without human beneficiaries.
The main application is “orphan structures”: STAR Trust owns shares of PTC (Private Trust Company), and PTC is the trustee of family trusts. PTC shares are not part of the founder's estate, ensuring complete orphaning.
- PPurpose without beneficiaries
You can create a trust for a purpose (for example, “to support a specific project”) rather than for people. Unique flexibility for DAO and philanthropic vehicles.
- EEnforcer instead of beneficiary
Enforcement of a trust is ensured by an enforcer, a specially appointed person. Could be a lawyer, a protector, or even an AI consortium.
- OOrphan for PTC
The most popular use: STAR owns PTC, PTC - trustee family trusts. Complete structural independence from any individual.
- ∞Without the rule of perpetuities
Can last as long as desired (unlike regular trusts with a 150 year limit). Ideal for long-term family wealth.
STAR technical parameters
- Regulatory act
- Trusts Act, Part VIII
- Beneficiaries
- Optional
- Goals
- Charitable + non-charitable
- Enforcer
- Required
- Lifetime of the trust
- No perpetual limit
- Trustee requirement
- Licensed trust company
- Tax
- 0% (Cayman neutral)
- Privacy
- Full (not public register)
Application
What do they decide?
Cayman trusts
Trusts are not just about “hiding assets.” This is a strategic planning tool: inheritance between generations, protecting assets from business risks, charity, company management.
Succession planning
Transfer assets across generations without probate disputes, inheritance taxes, or loss of privacy. Letter of Wishes provides "soft" trustee instructions without legal restrictions.
Asset protection
The assets in the trust are separate from the settlor's personal wealth. Protection from business creditors, judgments in other jurisdictions, brand-litigation. Statutory firewall provisions.
Charity
Charitable Trust or Foundation for systematic philanthropy. STAR Trust for special purposes (scientific awards, environmental projects, art preservation).
Holding structures
PTC + STAR = "orphan structure" for ownership of family assets. Confidential, protected from inheritance disputes, flexible in management (settler can be a director of PTC).
Premium private wealth
Investment portfolio management in a trust. Trustee-investment, regular reports, tax transparency for beneficiaries in their jurisdictions.
Web3/DAO
Foundation Company as a legal wrapper for DAO. STAR Trust for holding tokens treasury. Clear rights and obligations of participants, protection from personal liability.
Creating a Trust
4 phases -
from consultation to Trust Deed
Setting up a professional trust requires careful preparation. The actual time frame is 4–8 weeks, depending on the complexity of the structure and the number of beneficiaries.
1
Phase I Weeks 1–2
Consultation
Analysis of goals, assets, family structure. Selecting trust type, jurisdictions, trustee and protector.
2
Phase II Weeks 2–4
Trust Deed
Development of a trust declaration: beneficiaries, distribution rules, powers of trustee and protector, governing law clauses.
3
Phase III Weeks 4–6
Settlement & Funding
Formal trust signing, transfer of assets, initial grants. Letter of Wishes from the founder.
4
Phase IV ongoing
Escort
Annual accounts, distribution applications, changes in beneficiaries, investment decisions. We can act as PTC or trustee.
Thinking about a trust?
Confidential consultation
A lawyer partner will discuss your situation under an NDA. We'll tell you which type of trust is appropriate, what assets you can put into it, what the costs are, and how the structure works in your tax home.