While each of these cases kept informal accounts “in trust for”, they highlight the need for formal trust documentation and illustrate how difficult it is to demonstrate a clear intention to create a trust without a formal agreement. Trusts are also used for tax purposes. Well structured, trusts allow the deferral of accumulated capital gains and some income splitting¹. The Lord Chancellor would consider it “unscrupulous” that the rightful owner could go back to his word and deny the claims of the Crusader (the “real” owner). Therefore, he would find it in favor of the return of the Crusader. Over time, it was learned that the Court of the Lord Chancellor (the Court of Chancery) would constantly recognize the claim of a returning Crusader. The rightful owner would hold the land in favour of the original owner and would be obliged to return it to him upon request. The crusader was the “beneficiary” and the acquaintance was the “fiduciary”. It is necessary to take into account what income is taxed in Cyprus and which regime applies without residence in Cyprus. The court ruled that a valid trust had been created and ordered the defendant to pay the funds withdrawn plus interest to the plaintiff.
A written copy of the formal trust agreement or, in the case of an informal trust, a document describing the terms of the trust (commonly referred to as a declaration of trust) is required by Manulife when establishing trust policies in trust possession. If a lawyer sets up your trust, it will likely cost between $1,000 and $7,000, depending on the complexity of your financial situation. For example, in some situations, it may be necessary for some assets to require a revocable trust and for other assets an irrevocable trust.