Nerine Group of Fiduciaries has developed a domestic trust solution for Indian nationals as part of its work as the only independent trust company with an office in India.
Nerine was the first independent trust company to open an office in India with the launch of Nerine Advisory Services in Delhi in 2011, which was followed later that year by the incorporation of Nerine Trustee Company. These companies were established to offer a range of advisory and trustee services to families in India.
Pranav Khanna, Nerine Advisory Services India managing director, says: “Our decision to set up an office in India was a major step forward for us that cemented Nerine’s continued expansion plans in Asia after the success of our stand-alone office in Hong Kong.
“Our business focus in India has always been assisting clients with their planning for inward investment into the region, helping Indian clients with international business interests as well as developing succession planning arrangements for domestic Indian assets.
“The natural progression for succession planning was developing our domestic trust offering. Some may believe that, because India’s legal system is based on British law, this would be straightforward.
“This is not the case as Indian family law is complex and each religion has its own specific laws which must be adhered to. However, we now have the infrastructure and skills in place to advise and provide effective succession planning to Indian residents using domestic trusts.
“Factors in the past ten years have meant that there has been a renaissance in trusts as a mode of succession and estate planning in India. One reason is the rapid and broad economic growth which is setting the agenda for change in a number of areas.
“The other, arguably more significant, reason is that large businesses that have been overwhelmingly successful have remained within the same family for more than two generations.
“Nerine’s Indian domestic trust is tailored to meet clients’ expectations which have outgrown traditional solutions and they now need a structure that ensures optimisation and continuity of ownership and management skills matching the business’s present and future needs,” Khanna says.
There were still no domestic tax benefits for family trusts but trusts were considered the perfect vehicle for succession planning.
Another boost to private client structuring in India has been the Indian government’s relaxation of its rules on remittance of funds abroad by resident Indians. Every individual is now allowed to remit USD200,000 per year, including minors. This amount is expected to rise to USD400,000 in the next year.
“As a consequence, high net worth individuals (HNWIs) have started to accrue assets outside India that are subject to foreign taxes and laws,” Khanna says. “Nerine’s global spread of expertise means that a range of solutions can be provided from a number of jurisdictions; giving our clients customised and specialised services for their individual succession and estate planning requirements.”
