Employee Benefit Trusts are established by companies for a
number of reasons but primarily they are established to reward,
motivate and incentivise senior executives and employees.
In recent years the way in which senior executives and employees
are remunerated has changed. There has been a trend for annual
incentive programs to be linked more closely with specific
corporate and business unit performance measures.
This has been achieved by introducing:
long incentive plans
share option plans
employee share ownership plans
deferred compensations plans.
Working with their accountants, HR and Tax advisors, each
company will develop a plan tailored to their strategic objectives
and corporate requirements. For this reason no two plans are ever
the same. These plans are often managed through Employee Benefit
This may include:
vesting or exercising awards/options
purchasing and warehousing shares.
Establishing an Employee Benefit Trust in a tax-neutral
jurisdiction, such as Jersey, may create tax planning opportunities
for companies and their employees.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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The Miami-based Offshore Alert Conference has become a regular draw for representatives of Cayman’s financial services industry in recent years, and this year’s event is no exception with the Cayman Islands lending strong support through the provision of speakers from both the financial services industry and Government’s Ministry for Financial Services.
The Organisation for Economic Co-operation and Development recently published a report in which the Cayman Islands was commended for the "streamlined, efficient and responsive procedures it has is in place to facilitate the exchange of information for tax purposes".
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