Glossary.
Offshore terminology in plain English. From ATED to VASP — definitions written by HPT directors, not by marketing.
A
Autorité de Contrôle Prudentiel et de Résolution. The French banking, insurance and payment-services regulator, part of the Banque de France.
Abu Dhabi Global Market. An English common-law financial free zone in the UAE, with its own civil and commercial courts and the FSRA as regulator.
EU Alternative Investment Fund Managers Directive. Governs the authorisation, marketing and operation of alternative investment funds in the EU.
The EU's Sixth Anti-Money Laundering Directive, harmonising AML criminal-law standards and predicate offences across member states.
An annual filing required of most companies to confirm key statutory information (directors, shareholders, registered office). Called a confirmation statement in the UK.
An authentication added to a public document for use abroad under the 1961 Hague Convention. Required for cross-border corporate filings in most reputable jurisdictions.
EU Anti-Tax Avoidance Directive (ATAD I and II). Establishes CFC rules, interest-limitation, hybrid-mismatch and exit-tax requirements across EU member states.
UK Annual Tax on Enveloped Dwellings. Applies to residential property held through enveloped (corporate) ownership over £500,000, with reliefs available for genuine commercial use.
B
UK Business Asset Disposal Relief (formerly Entrepreneurs' Relief). A 10% CGT rate (14% from 2026) on up to £1M of lifetime qualifying business gains.
Bundesanstalt für Finanzdienstleistungsaufsicht. The German integrated financial regulator covering banking, insurance and securities.
A share whose holder is the registered owner. Largely abolished post-FATF; surviving regimes require immobilisation with a custodian.
The natural person who ultimately owns or controls a legal entity. Reportable under modern AML and BO-register frameworks.
A person or class of persons named as the intended recipient under a trust or foundation.
OECD Base Erosion and Profit Shifting project. Fifteen actions reshaping international corporate tax since 2015, including substance, treaty access and Pillar Two.
Beneficial Ownership register. Required in most modern jurisdictions; access tiers and materiality thresholds vary by country.
British Virgin Islands Business Company under the BVI Business Companies Act 2004. The most-used offshore corporate vehicle globally.
C
OECD Crypto-Asset Reporting Framework. The crypto equivalent of CRS, extending automatic information exchange to crypto custodians and exchanges from 2027.
Crypto-Asset Service Provider. The authorised entity category under EU MiCA — broadly equivalent to a VASP outside the EU.
Citizenship by Investment. A passport granted in exchange for qualifying investment or contribution. Distinct from CBI (Central Bank of Ireland) in fund contexts.
Customer Due Diligence. The baseline KYC review every regulated firm performs at onboarding, including identity, address and source-of-funds verification.
A registry-issued certificate confirming a company is current on its filings and not subject to strike-off. Routinely required for cross-border transactions.
A document listing the current officers, directors and shareholders of a company. Routinely required for bank-account openings.
Controlled Foreign Company rules. Home-country tax rules that attribute income of offshore subsidiaries back to a domestic taxpayer. Almost every developed jurisdiction operates them.
A US-law mechanism limiting a judgement creditor's recovery from an LLC to distributions, rather than dissolution. Stronger in some states (Wyoming, Nevada) than others.
The constituting document of a corporation in US and Caribbean jurisdictions. Equivalent to the memorandum and articles of association in commonwealth systems.
Cayman Islands Monetary Authority. The integrated regulator for banking, insurance, funds and trust services in the Cayman Islands.
The UK annual filing confirming a company's key statutory data (directors, shareholders, PSCs). Replaced the annual return in 2016.
The corporate redomiciliation process by which a company changes its jurisdiction of incorporation without dissolution or loss of legal personality.
A bilateral arrangement under which one bank holds accounts for another. The post-2018 de-risking trend has constrained offshore correspondent access.
A trustee appointed alongside one or more others. Decisions require majority or unanimity as specified in the trust deed.
A US-law category triggering the section 877A exit-tax on citizenship renunciation, based on net-worth, average tax-liability and certification tests.
OECD Common Reporting Standard. The automatic exchange of financial-account information between participating jurisdictions, active since 2017.
Cyprus Securities and Exchange Commission. Regulates investment firms, funds and crypto-asset service providers in Cyprus.
D
EU Council Directive 2018/822 requiring intermediaries to disclose cross-border tax arrangements meeting prescribed hallmarks.
EU directive requiring digital platforms to report income earned by sellers to tax authorities, effective from 2023.
EU directive extending tax information exchange to crypto and certain other assets. Effective from January 2026, with first reporting in 2027.
UK concept treating a long-resident individual as UK-domiciled for IHT purposes after 15 of the previous 20 tax years. Replaced in 2025 by the long-term-resident test.
Dubai Financial Services Authority. The regulator for financial services within the DIFC free zone.
Dubai International Financial Centre. An English common-law financial free zone in the UAE, with its own court system and the DFSA as regulator.
A director resident in the jurisdiction of incorporation, attending board meetings locally. Required for credible economic substance.
A trust under which the trustee has discretion over distributions among a class of beneficiaries. The most flexible common-law trust form.
Distributed Ledger Technology. The technical category encompassing blockchain and similar consensus-based ledger systems.
Dubai Multi Commodities Centre. A UAE free zone used by commodity, trading, fintech and crypto entities.
A trust designed to operate across multiple generations, exempt from the rule against perpetuities in qualifying jurisdictions (Nevada, South Dakota, Wyoming, Cook Islands).
E
US Effectively Connected Income. Foreign-person income connected to a US trade or business, taxed at graduated US rates.
Real economic activity in a jurisdiction (directors on the ground, premises, employees, decisions made there). Tested under Caribbean and Crown Dependency substance regimes since 2019.
Enhanced Due Diligence. The heightened review required for higher-risk customers — PEPs, complex structures, crypto-source funds and high-risk jurisdictions.
EU Regulation 910/2014 governing electronic identification and trust services for cross-border transactions, including qualified electronic signatures.
A digital signature recognised as legally equivalent to a handwritten one in most modern jurisdictions, subject to specific format and identity-verification requirements.
Electronic Money Institution. A regulated entity authorised to issue electronic money and provide payment services under UK, EU and other regimes.
Electronic Money Token. A MiCA category for crypto-asset tokens referencing a single fiat currency.
Engaged in a Trade or Business in the United States. The test that triggers US tax exposure for foreign persons on connected income.
A UK IHT structure under which non-UK situs assets settled by a non-domiciled settlor fall outside the UK estate, subject to specific conditions.
A deemed-disposal tax charged on cessation of residence in certain countries — Germany (Wegzugsteuer), France, US (section 877A), Canada, Australia and the Netherlands.
F
US Foreign Account Tax Compliance Act. Requires non-US financial institutions to report US-person accounts to the IRS, backed by 30% withholding.
Financial Action Task Force. The inter-governmental body setting global AML and counter-terrorist-financing standards.
Jurisdictions under increased FATF monitoring for AML deficiencies. Grey-listing drives bank de-risking and elevated EDD globally.
US Report of Foreign Bank and Financial Accounts (FinCEN 114). Required for US persons with foreign accounts aggregating over $10,000 at any point in the calendar year.
UK Financial Conduct Authority. The conduct regulator for financial services, payment institutions and electronic money in the UK.
UK Foreign Income and Gains regime. A four-year relief for new UK residents, replacing the historic non-dom remittance basis from April 2025.
Swiss Financial Market Supervisory Authority. The integrated regulator for banking, securities and insurance in Switzerland.
US Foreign Investment in Real Property Tax Act. Imposes 15% withholding on disposals of US real-property interests by foreign persons.
Civil-law concept reserving statutory portions of an estate for specific heirs (children, spouse). A primary driver of offshore-trust planning for civil-law-resident clients.
Switzerland's lump-sum (expenditure-based) taxation regime for inbound HNW non-Swiss nationals.
A purpose-driven legal entity with no shareholders. Common in civil-law jurisdictions including Panama, Liechtenstein, Nevis multiform and Jersey.
A transfer made to defeat actual or contemplated creditors. The look-back period, solvency test and badges-of-fraud vary by jurisdiction.
Financial Services Regulatory Authority of ADGM. Regulates financial services within the Abu Dhabi Global Market free zone.
G
Global Business Company. The Mauritius international-business vehicle, replacing the previous GBC1 and GBC2 split.
Two unrelated regulators share this abbreviation: the Gibraltar Financial Services Commission and the Guernsey Financial Services Commission.
US Global Intangible Low-Taxed Income. A current-inclusion regime applied to US shareholders of controlled foreign corporations.
Global Anti-Base Erosion rules under OECD Pillar Two. Imposes a 15% minimum effective tax rate on in-scope multinational groups (>€750M revenue).
Colloquial term for residence-by-investment programmes — most commonly used in respect of Portugal, Greece, Spain, Italy and the UAE.
H
The single-step legalisation provided under the 1961 Hague Apostille Convention, replacing consular legalisation between member states.
Hong Kong Monetary Authority. The integrated banking and currency regulator for Hong Kong.
Holding company. Typically tax-resident in a jurisdiction with a treaty network, a participation exemption and credible economic substance.
A cross-border tax structure exploiting different jurisdictional characterisations of an entity or instrument. Largely neutralised under BEPS Action 2 and ATAD II.
I
International Business Company. An older form of offshore company, mostly phased out or rebranded post-BEPS.
Irish Collective Asset-management Vehicle. The flagship Irish corporate fund structure, introduced in 2015.
UK Inheritance Tax. 40% on estates above the nil-rate band, with significant reliefs for spouse, business and agricultural assets.
A director with no employment, ownership or family connection to the entity. Required by most fund and substance regimes.
Pooled investment vehicles. Common offshore domiciles include Cayman, BVI, Luxembourg, Ireland, Mauritius and Singapore.
J
Jersey Financial Services Commission. Regulates funds, trust, banking and investment business in Jersey.
Contractual or corporate arrangement under which two or more parties pool resources for a specific project, with agreed exit and dispute-resolution mechanics.
K
Know-Your-Business. The corporate equivalent of KYC, applied to corporate clients and their ultimate beneficial owners at onboarding.
Know-Your-Customer. The identity, address and source-of-funds verification step that every regulated firm performs at onboarding.
Know-Your-Transaction. Blockchain-analytics screening of crypto transactions against AML risk factors (mixers, sanctioned wallets, exchanges).
L
The authentication of a public document for use abroad. The Apostille is the simplified Hague Convention version; otherwise consular legalisation is required.
A non-binding letter from a settlor to a trustee indicating preferences on distributions. Critical for discretionary-trust governance.
A regulated insolvency professional appointed to wind up a company. Different in scope from a receiver or an administrator.
Limited Liability Company. Distinct from a UK Ltd in its default tax treatment — typically disregarded or partnership for US purposes unless an election is made.
Limitation on Benefits. A tax-treaty clause restricting treaty benefits to qualifying residents of the contracting state.
Borrowing against a portfolio of liquid securities held with a private bank. The principal credit product in private-banking relationships.
The UK IHT test introduced in 2025 — generally, an individual UK-resident for 10 of the prior 20 tax years becomes IHT-chargeable on worldwide assets.
Limited Partnership. A common fund vehicle. Distinguished from a GP (general partner) by liability exposure and management role.
M
Monetary Authority of Singapore. Singapore's central bank and integrated financial regulator.
A two-tier fund structure pairing a master fund (where investment occurs) with one or more feeder funds (for tax-different investor classes).
Malta Financial Services Authority. Active across banking, EMI, VASP, fund and gaming licensing.
EU Markets in Crypto Assets regulation. The harmonised framework for crypto-asset service providers across the EU, effective from December 2024.
OECD Multilateral Instrument. A single treaty modifying thousands of bilateral tax treaties post-BEPS, in force since 2018.
Money Laundering Reporting Officer. A mandatory senior compliance role in regulated firms, with personal responsibility for SAR filing.
Malaysia My Second Home. A long-term residency programme for foreign nationals, revised significantly in 2024.
Multi-Party Computation. A cryptographic custody technique splitting transaction-signing authority across multiple parties without ever assembling a private key.
Money Services Business. The US (FinCEN) and Canadian (FINTRAC) regulatory category for money transmitters and currency exchangers.
US state-level Money Transmitter Licence. Required state-by-state for any US-facing payment activity.
N
Acquisition of citizenship through residency rather than investment, typically after five to ten years and a language or integration test.
An asset-protection trust under the Nevis International Exempt Trust Ordinance, distinguished by its bond requirement and short statute of limitations for creditor claims.
The UK IHT threshold (£325,000) below which an estate incurs no IHT. Transferrable between spouses.
A director appointed for record purposes who acts on instructions. Post-CRS and BEPS, viable use cases have narrowed sharply; HPT generally avoids them.
A shareholder holding shares on trust for an undisclosed beneficial owner. Subject to BO reporting in most jurisdictions.
Authentication of a signature by a notary public. The lowest tier of cross-border document authentication.
O
Operating company. The trading entity in a typical holding-and-trading two-tier corporate structure.
P
A holding-company tax regime exempting dividends and capital gains on qualifying participations. Available in the Netherlands, Luxembourg, Spain, Singapore and Cyprus.
Protected Cell Company. A statutory ring-fencing structure used principally in insurance and funds.
Politically Exposed Person. A natural person entrusted with prominent public functions, automatically requiring enhanced due diligence.
A fixed place of business or dependent agent creating a taxable presence in a treaty jurisdiction. Defined in Article 5 of the OECD Model.
Professional Indemnity insurance. Cover against advisor errors. Indispensable when choosing an advisor.
A legal doctrine permitting courts to disregard corporate separateness in defined circumstances (fraud, sham, alter-ego).
OECD framework reallocating taxing rights for the largest multinationals to market jurisdictions through Amount A. Implementation is ongoing.
OECD framework imposing a 15% global minimum effective tax rate on in-scope multinational groups with annual revenue over €750M.
Principal Purpose Test. The anti-treaty-shopping rule under the MLI denying treaty benefits where the principal purpose is to obtain them.
A person or committee with reserved powers under a trust deed (e.g., to remove trustees). Used to balance settlor intent with trustee discretion.
UK Person with Significant Control register. The public beneficial-ownership register for UK companies, in force since 2016.
Payment Services Provider. A regulated entity providing payment processing. Often a step-up from EMI in capital and licence scope.
A trust without beneficiaries, established for a specified purpose. Common variants: Cayman STAR, BVI BVITLA and Jersey purpose trust.
Q
Qualifying Investor Alternative Investment Fund. Ireland's flagship AIF structure for sophisticated investors, supervised by the Central Bank of Ireland.
Qualifying Non-UK Pension Scheme. An overseas pension scheme satisfying specific UK requirements for inheritance-tax efficiency.
Qualifying Recognised Overseas Pension Scheme. The UK-recognised overseas-pension transfer route, used by globally-mobile UK pension members.
A resulting trust arising when funds are transferred for a specific purpose. Named after the 1970 Quistclose case.
R
Reserved Alternative Investment Fund. Luxembourg's flagship light-touch fund vehicle for sophisticated investors, supervised at the AIFM level rather than the fund.
Ras Al Khaimah International Corporate Centre. The UAE offshore-corporate registry, distinct from RAK Free Zone (onshore).
Residency by Investment. Permit or residence granted in exchange for qualifying investment, donation or job creation.
A court-appointed officer managing assets pending resolution of a dispute. Different in role from a liquidator or administrator.
Statutory transfer of a company's jurisdiction of incorporation, preserving its legal personality and existing contracts.
A UK tax basis (now largely replaced by the FIG regime) under which non-doms were taxed on UK income and gains plus foreign income remitted to the UK.
A trust under which the settlor retains specified powers (e.g., investment direction) without invalidating the trust. Recognised by statute in BVI, Cayman and Jersey.
A trust arising by operation of law when legal title transfers without an intention to transfer the beneficial interest.
S
Suspicious Activity Report. A regulated firm's mandatory filing on suspected money-laundering activity. International equivalent: STR (Suspicious Transaction Report).
UK Stamp Duty Land Tax. Up to 17% on residential property purchases by non-resident corporate buyers (subject to reliefs).
The US exit-tax regime applied to covered expatriates renouncing citizenship — a deemed mark-to-market on worldwide assets.
A trust where the settlor is also a beneficiary. Creditor-protection enforceability varies sharply by jurisdiction, with Cook Islands and Nevis being the leading offshore venues.
The person who establishes a trust by transferring assets to a trustee on the terms of a trust deed.
Securities and Futures Commission of Hong Kong. The securities, fund-management and licensing regulator.
Common-law principle treating a trust as invalid where the settlor retains de facto ownership and the trust is a façade.
Securities and Investment Business Act (BVI). The framework governing BVI funds, investment advisers and brokers.
Société de Participations Financières. The Luxembourg holding-company regime benefiting from the participation exemption and a deep treaty network.
Documentation evidencing the origin of capital for a specific transaction. Distinct from source of wealth.
Documentation evidencing the historical accumulation of an individual's overall wealth. The harder document to assemble — and the one that gets rejected most often.
Segregated Portfolio Company. The Cayman statutory ring-fencing structure used principally in insurance and funds.
UK SRT relief allowing a tax year to be split between resident and non-resident periods on qualifying departure or arrival, against specified case codes.
Special Purpose Vehicle. An entity created for a specific transaction, asset or risk-segregation purpose.
UK Statutory Residence Test. Codified in Schedule 45 of the Finance Act 2013. Determines UK tax residence for individuals.
Cayman Special Trusts (Alternative Regime) Act. Provides the statutory framework for Cayman non-charitable purpose trusts.
The US current-inclusion regime applied to passive and base-company income of controlled foreign corporations. Predates GILTI but still applies in parallel.
Real economic activity in a jurisdiction (directors on-ground, office, employees, decisions made there). Paper substance has been failing audits since 2023.
Component of the UK SRT counting connecting factors — family, work, accommodation, the 90-day tie and the country tie — to determine residence.
T
Trust or Company Service Provider. A regulated category in HK, BVI, UK and others. HPT works with licensed TCSPs in each jurisdiction; we are not licensed as a TCSP ourselves.
UK SRT rule re-assessing year-of-departure CGT charges where an individual returns to UK residence within five tax years.
Transactional Net Margin Method. A transfer-pricing method comparing the net margin earned on a controlled transaction to comparable uncontrolled transactions.
The pricing of cross-border intercompany transactions. Governed by the OECD arm's length principle and the BEPS Actions 8–10 guidance.
FATF Recommendation 16 requiring VASPs to share originator and beneficiary information on crypto transfers above defined thresholds.
UK Trust Registration Service. The mandatory registry for express trusts with UK touch points.
The constitutive instrument establishing a trust, setting out trustee powers, beneficiary class, distribution rules and dispute mechanics.
The legal owner of trust assets, holding them on the terms of the trust deed for the benefit of the beneficiaries.
U
Ultimate Beneficial Owner. The natural person who ultimately owns or controls an entity. Reportable under the BO-register frameworks in most jurisdictions.
Undertakings for Collective Investment in Transferable Securities. The EU's harmonised retail-fund regime, distributable across member states.
V
Virtual Assets Regulatory Authority. Dubai's dedicated virtual-asset regulator, established in 2022 — the world's first city-level dedicated crypto regulator.
Virtual Asset Service Provider. A regulated entity for crypto custody, exchange or transfer services. Outside the EU; inside the EU the equivalent term is CASP.
Variable Capital Company. Singapore's fund vehicle introduced in 2020, competing with Cayman, BVI and Luxembourg for Asia-Pacific fund domicile.
BVI Virgin Islands Special Trusts Act. Allows trusts holding BVI-company shares to disapply the prudent-investor rule, supporting family-business and holding-company use cases.
A solvent winding-up of a company instigated by shareholder resolution, distinct from compulsory or insolvent liquidation.
W
Germany's exit tax on departure for substantial-shareholders, calibrated on a deemed-disposal of qualifying participations.
A handwritten ink signature, distinct from electronic signatures. Still required by certain consular and banking processes.
A subsidiary where 100% of the equity is held by a single parent entity, often used to ring-fence specific risks or business lines.
Y
Flag-state registration of a yacht, separating legal ownership from operational and crew matters. Common flag states: Cayman, Isle of Man, Malta, Marshall Islands and the Red Ensign.
Z
A jurisdiction with no headline personal or corporate income tax. Producing a zero-tax outcome usually requires more than residency alone — substance, source rules and home-country exit must all align.
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