It is important to understand that continued holding of wealth in this form actually diminishes its value. The tax system is particularly biased against this type of passive trust value and imposes continuing fiscal penalties both during the lifetime and especially upon death.

Creating Active Income Value

To counter the negative effects described above, the Offshore Trust Liberation Plan transforms passive trust value into active income value through the sale of the trust assets. It is this sale which releases the active value of those assets, converting them into commercial investments. And the tax system recognises that transformation.

However, that newly created, active value then provides a return of income to the trust which, in contrast to the previous settlement of passive capital values, is structured to fit the real lifetime income requirements of beneficiaries.