Estate & Wealth Planning
Estate & Wealth Planning
Planning for your future and that of your dependents deserves special attention. Acumum Trustees & Fiduciaries Limited is licensed by the Malta Financial Services Authority (MFSA) to provide foundations, family trust companies, and family trust companies, escrow and other fiduciary arrangements.
Malta’s Trusts and Trustees Act of 2004 is modelled on the UK Law of Trusts (Jersey), providing assurance and peace of mind for international settlors and beneficiaries. With Malta’s EU membership, the jurisdiction offers a high level of regulation, accessibility, and security for trust activities. Trustees are highly regulated by the Malta Financial Services Authority (MFSA), where they must undergo and meet ‘fit and proper’ investigations, unlike some other jurisdictions.
WHAT IS A Trust?
A trust is an arrangement that allows a settlor to transfer assets to a trustee, who holds and manages those assets for the benefit of named beneficiaries. Trusts in Malta provide a flexible estate and commercial planning method for both private individuals and commercial applications.
Malta’s Trusts and Trustees Act of 2004 is modelled on the UK Law of Trusts (Jersey), providing assurance and peace of mind for international settlors and beneficiaries. With Malta’s EU membership, the jurisdiction offers a high level of regulation, accessibility, and security for trust activities. Trustees are highly regulated by the Malta Financial Services Authority (MFSA), where they must undergo and meet ‘fit and proper’ investigations, unlike some other jurisdictions.
Maltese legislation allows for the creation of various types of trusts, including discretionary trusts, purpose trusts, and charitable trusts. A trust does not have its own legal personality and is not registered anywhere; there are no formalities for annual maintenance other than the statutory obligations imposed on trustees.
A Malta trust is subject to a maximum duration of 100 years (125 years for family trusts).
key roles in a Trust
The Settlor is the person who sets up the trust. The settlor must be of age, have full capacity to contract, and have a free disposition of the assets settled on trust. While imposing fiduciary obligations upon the trustee in favour of the beneficiaries, trusts do not leave the settlor with rights in relation to the trust property, except as specifically provided in the Trusts and Trustees Act. The settlor retains the right to seek court directives as to trust validity, the right to a variation of terms, and revocable trusts where the trust deed so provides.
The Protector is typically a person in a trustworthy position (for example, a trusted family adviser). Subject to the trust terms, the protector typically has the power to appoint new and/or additional trustees, remove trustees, and require trustees to obtain the protector’s consent in relation to particular matters, such as the purchase or sale of trust property.
The Beneficiary is the person who may benefit from the assets of the trust. All beneficiaries must be mentioned by name, or be ascertainable by class or by relationship to a person, alive or dead. The rights of the beneficiary are personal and are regarded as movable property. The beneficiary has the right to information from the trustee and may seek court directives regarding the validity of the trust.
The Trust Deed is the instrument whereby the trust is created and includes the terms of the trust. A Letter of Wishes may also be provided by the settlor to guide the trustee on how to exercise discretion.
Key Advantages of a Malta Trust
Private use:
- Avoids lengthy probate processes and associated expenses
- Minimises estate taxes and may shift taxes to beneficiaries who enjoy more favourable tax rates
- Preserves assets from creditors and protects assets for a child beneficiary
- Assets are not part of matrimonial property upon death
- Allows the holding of any property for any person, irrespective of nationality or residence
- If desired and stated, the laws of a jurisdiction other than Malta may govern the trust
- Confidential: trusts are not publicly registered
Commercial use:
- Unit trusts, allowing the holding of any property for any person, irrespective of nationality or residence
- Collective investment schemes, including the holding of real estate securitisation
- A form of guarantee
Tax Treatment of Malta Trusts
By default a trust is tax transparent in Malta – meaning that no Malta tax is charged to the trust or its trust assets, instead any distributions to beneficiaries maybe taxed in the tax jurisdiction of the beneficiary.
A trustee may elect that the trust be treated as if it were a company ordinarily resident and domiciled in Malta. Any distribution of profits will be taxed at the prevailing corporate rate of 35%. Non-resident beneficiaries can claim a tax refund, resulting in an effective tax rate on trust income of 5% to 6.25%.
A trust treated as a company for tax purposes may also avail itself of Malta’s 70+ double tax treaties, as well as EU directives such as the Parent Subsidiary Directive, which results in 0% taxation at the level of the trust on subsidiary income distributed up to the trust.
Acumum Advisory’s Trust Services
- Trust formation, structuring, and drafting of trust deeds
- Acting as professional regulated trustee
- Trust administration: asset management coordination, accounts, distributions to beneficiaries, regulatory compliance
- Advisory for settlors and beneficiaries on rights, responsibilities, and entitlements
- Trust restructuring and termination
Family Private Trust Companies
Malta is a particularly favourable jurisdiction in which to establish family wealth structures and, in particular, family trust companies. A Malta family private trust company (PTC) is similar to a private trust company found in other jurisdictions, such as Jersey.
Legislation amending the Trusts and Trustees Act in 2014 introduced the concept of family trust companies — property settled upon trusts for the present and future needs of family members and family dependants
Unlike a traditional trust, a family private trust company allows the family to maintain a significant degree of control and involvement in the management of their assets as they are permitted to sit on the board of the PTC, ensuring that their specific values and objectives are upheld for generations to come.
Family trust companies that satisfy the prescribed requirements are not required to obtain full authorisation, although they must apply for registration with the MFSA and adhere to ongoing compliance conditions, which include:
- Company structure: Must be set up as a limited liability company (Ltd) with a memorandum and articles which is strictly limited to acting as trustee for specific settlors
- Settlor limit: Maximum of five settlors
- Board of directors: Minimum of three directors, at least one of whom must possess proven knowledge and experience in trust administration
- Beneficiaries: The trust must be for the benefit of the family members of the settlors
- Regulatory compliance: A Money Laundering Reporting Officer (MLRO) must be appointed
Eligible beneficiaries include any individuals related to the settlor by consanguinity, adoption, or affinity in the direct line up to any degree, whether as an ascendant or descendant. In the collateral line, this extends up to the fifth degree inclusively.
Key Benefits of a Family Private Trust in Malta
- Family Directs Their Own Affairs: Family members can be involved in the decision-making process, providing more control than a traditional institutional trustee
- Asset protection: Safeguards family assets from creditors, political instability, or disputes; assets placed in trust are legally owned by the trustee, separating them from personal liabilities
- Succession planning: Ensures a smooth and efficient transfer of wealth to future generations, avoiding the complexities and potential delays of probate
- Confidentiality: Trust arrangements in Malta are private and not publicly registered
- Centralised management: Consolidates the management of diverse family assets — property, investments, and business shares — under a single, professionally governed structure.
- Tax efficiency: Malta’s favourable tax regime offers significant advantages for trusts, providing an efficient structure for wealth growth and distribution
Acumum Trustee & Fiduciary Family Private Trust Services
- Organising the implementation and ongoing maintenance of family wealth and investment structures
- Establishment of family trusts, foundations, and family trust companies
- Acting as ‘knowledgeable’ director of family trust companies
- Ensuring ongoing compliance and regulatory adherence
- Regular asset summaries, activity reports, and accounts
- Oversight of asset and investment strategies and third-party providers
- Preparation of management and financial accounts.
Key Benefits of a Family private Trust in Malta
- Family Directs Their Own Affairs: Family members can be involved in the decision-making process, providing more control than a traditional institutional trustee
- Asset protection: Safeguards family assets from creditors, political instability, or disputes; assets placed in trust are legally owned by the trustee, separating them from personal liabilities
- Succession planning: Ensures a smooth and efficient transfer of wealth to future generations, avoiding the complexities and potential delays of probate
- Confidentiality: Trust arrangements in Malta are private and not publicly registered
- Centralised management: Consolidates the management of diverse family assets — property, investments, and business shares — under a single, professionally governed structure
- Tax efficiency: Malta’s favourable tax regime offers significant advantages for trusts, providing an efficient structure for wealth growth and distribution
Acumum Trustee & Fiduciary Family Private Trust Services
- Organising the implementation and ongoing maintenance of family wealth and investment structures
- Establishment of family trusts, foundations, and family trust companies
- Acting as ‘knowledgeable’ director of family trust companies
- Ensuring ongoing compliance and regulatory adherence
- Regular asset summaries, activity reports, and accounts
- Oversight of asset and investment strategies and third-party providers
- Preparation of management and financial accounts
Malta Foundations
A Malta Foundation is a highly versatile legal entity used for private wealth management, asset protection, and estate planning. Governed by the Second Schedule of the Civil Code (Chapter 16 of the laws of Malta), it offers a secure and confidential structure that owns assets on behalf of its beneficiaries, ensuring a clear separation from the founder’s personal estate.
Unlike a trust, a foundation has its own distinct legal personality, separate from that of its founders, administrators, and beneficiaries. Although a Maltese foundation cannot itself have a commercial purpose, it can be the passive owner of a commercial business, commercial property, or other commercial assets.
Foundations may be established by way of deed or by testamentary will, and may serve the following purposes:
- Private foundations: For the benefit of a named person or class of persons
- Purpose foundations: For the fulfilment of a specified purpose, including charitable purposes; can endure for an unlimited time
- Commercial applications: As collective investment vehicles, securitisation vehicles, or shipping organisations
Duration: Private foundations are valid for a maximum of 100 years; purpose foundations (particularly charitable) can be established for an indefinite period.
Minimum endowment:
- Private foundation: €1,165
- Social or non-profit making purpose foundation: €233
Segregated Cells
An innovative feature of Malta foundation law is the provision for segregated cells within a foundation. Segregated cells allow assets and liabilities to be insulated from other assets and liabilities of the same organisation, constituting a separate patrimony distinct from all other assets and liabilities of the foundation or other cells.
Conversion Between Trusts and Foundations
Malta law provides for the conversion of a foundation into a trust, and vice versa, granting individuals and organisations the flexibility to benefit from the diverse characteristics of both structures as circumstances change over time.
Taxation of Malta Foundations
A Malta foundation can be taxed in one of two ways, as elected by its administrators:
Option 1 — Taxed as a Trust (0% for non-residents) Administrators may elect that the foundation be taxed under the provisions applicable to trusts. Profits received would be charged to beneficiaries following distribution. If all beneficiaries are non-resident in Malta and all income is of foreign source, there is no tax payable in Malta.
Option 2 — Taxed as a Company (effective rate 5%–10%) A foundation may be treated as a company for income tax purposes, subject to tax at 35% on worldwide income. Upon receipt of a distribution, beneficiaries are generally entitled to a refund of 6/7ths of tax paid (for trading income) or 5/7ths (for passive income), reducing the Malta tax liability to 5% or 10% respectively. The foundation may also benefit from the participation exemption provisions.
Charitable foundations enrolled under the Voluntary Organisations Act are subject to progressive tax rates capped at 30% instead of 35%.
Acumum Trustees & Fiduciaries Ltd’s Foundation Services
- Foundation structuring, establishment, and drafting of bespoke foundation charters
- Administration and governance: ensuring full compliance with Maltese requirements
- Asset management and protection across property, investments, and business shares
- Tax advisory and compliance
- Conversion services between trusts and foundations
Trusts | Foundations | |
|---|---|---|
Legal personality | None | Own legal personality |
Asset ownership | Trustee owns assets | Foundation owns its own assets |
Oversight | Protector | Supervisory council |
Purpose structures | Not available | Purpose foundations allowed |
Registration | Not registered | Registered (details remain private) |
Max. duration | 100 yrs (125 for family trusts) | 100 yrs (private); unlimited (purpose) |
Trusts VS Foundations
Trusts | Foundations | |
|---|---|---|
Legal personality | None | Own legal personality |
Defined by | Relationship between parties | The assets making up the foundation |
Oversight | Protector | Supervisory council |
Purpose structures | Not available | Purpose foundations allowed |
Asset ownership | Trustee is the legal owner of the assets | Foundation is the legal owner of its own assets |
Registration | Not registered | Must be registered (details remain private) |
Maximum duration | 100 years (125 for family trusts) | 100 years (private); unlimited (purpose/charitable) |
Minimum endowment | None specified | €1,165 (private); €233 (social/non-profit) |
Escrow & security arrangements
Malta offers a robust and flexible escrow service environment, primarily facilitated by licensed trustees and fiduciary companies under the regulation of the Malta Financial Services Authority (MFSA). This ensures credibility, reliability, and adherence to strict confidentiality and asset segregation requirements.
Escrow services are designed to provide security and risk mitigation for parties engaged in commercial and non-commercial transactions, especially where parties may not be familiar with each other’s business practices.
Acumum Trustees & Fiduciaries Limited is an MFSA-licensed trustee and fiduciary company, established in 2012. Acumum acts as an independent, neutral escrow agent — holding funds, assets, or documents on behalf of transacting parties and ensuring that all contractual conditions are met before the release or transfer of assets.
Key Features of Escrow Services
Independent Third-Party Agent Escrow services are provided by licensed entities such as Acumum Trustees & Fiduciaries Limited, acting as neutral intermediaries. As the escrow agent, Acumum holds funds, assets, or documents on behalf of transacting parties, ensuring that contractual conditions are met before the release or transfer of assets.
Escrow Agreement Every arrangement is governed by a formal escrow agreement. This document outlines the terms, conditions, and procedures for the operation of the escrow, including the criteria for releasing the held assets.
Wide Range of Applications Escrow services in Malta are used across a broad range of transaction types and sectors including aviation, corporate, project finance, and maritime, among others. Specific applications include:
- Corporate transactions – transfers of securities, shares, or equity
- Intellectual property and domain name transfers
- Financing and security transactions
- Asset purchases, mortgages, and sales
- Safe-keeping of valuable documents or collectibles
Risk Reduction Escrow mechanisms mitigate the risk of fraud or non-fulfilment by ensuring that assets are only released when all agreed-upon conditions are satisfied, verified by Acumum as the escrow agent or by an independent expert.
Customisation and Flexibility Escrow services are highly customisable to meet the specific needs of each transaction, providing tailored solutions for both local and international deals.
Confidentiality and Segregation Trust and escrow arrangements in Malta are subject to stringent confidentiality rules. Assets held in escrow are strictly segregated from the personal assets of the trustee or escrow agent, and maintained in dedicated client accounts.
The escrow process
Stage 1 — Agreement The parties agree on the terms of the transaction and appoint Acumum Trustees & Fiduciaries Limited as the licensed escrow agent.
Stage 2 — Deposit The grantor transfers the funds, assets, or documents to Acumum as the escrow agent for safe-keeping.
Stage 3 — Verification Acumum as the escrow agent verifies compliance with the contractual terms and conditions, and where applicable coordinates with independent experts.
Stage 4 — Release Upon satisfaction of all conditions, Acumum as the escrow agent releases the funds or assets to the grantee.
regulatory framework
MFSA Oversight – the MFSA regulates all trustee and fiduciary companies in Malta, ensuring that escrow services are conducted with integrity and in full accordance with Maltese law. Acumum Trustees & Fiduciaries Limited’s licence and conduct record are publicly available on the MFSA’s Financial Services Register.
Trusts and Trustees Act – the Trusts and Trustees Act, Chapter 331 of the laws of Malta, provides the legal framework for the establishment and operation of trusts and fiduciary relationships under which escrow services are offered, providing all parties with a clear, well-established, and enforceable legal basis for their arrangement.
Why Choose Acumum for Your Escrow Needs?
MFSA Licensed and Regulated Acumum Trustees & Fiduciaries Limited has operated under the strict oversight of the Malta Financial Services Authority since 2012, ensuring full compliance, integrity, and credibility in every transaction.
Proven Experience Our team brings extensive expertise in managing complex, high-value, and cross-border transactions across multiple sectors including aviation, maritime, and corporate finance.
Complete Neutrality As an independent third party, Acumum’s sole focus is to execute the terms of the escrow agreement faithfully and impartially for all parties involved.
Asset Security All funds and assets held in escrow are strictly segregated and protected in dedicated client accounts, providing complete peace of mind for all transacting parties.
Customised Solutions No two transactions are the same. Acumum works with all parties to tailor escrow agreements that meet precise needs, conditions, and timelines.
frequently asked questions
What is an escrow agent?
An escrow agent is a neutral and independent third party — such as Acumum Trustees & Fiduciaries Limited — that holds and regulates the payment or assets involved in a transaction on behalf of the other parties. The assets are released only when all contractual conditions have been met.
What types of transactions use escrow services?
Escrow is ideal for any transaction where security and risk mitigation are paramount. This includes real estate purchases, mergers and acquisitions, intellectual property transfers, aviation and maritime sales, project financing, and the holding of securities or valuable documents.
Is using an escrow service in Malta safe?
Yes. Escrow services in Malta are provided by companies licensed and regulated by the MFSA, ensuring strict adherence to legal standards, asset segregation, and confidentiality — making it a highly secure mechanism for transactions.
How is an escrow agreement created?
An escrow agreement is a formal document drafted to outline the specific terms and conditions of the transaction. It details the duties of the escrow agent, the conditions for the release of assets, timelines, and dispute resolution procedures. All parties must agree to and sign this document before the escrow is activated.
If you would like to know how Acumum can assist you,