European Union: Trusts

As life expectancy in Italy reaches 81.7 years for men and 85.7 years for women while fertility rates decline, families and entrepreneurs face unprecedented challenges in managing wealth transfer, business continuity, and protection during extended periods of potential incapacity. Italian lawmakers have begun addressing these demographic shifts through new legislation, but private family planning remains essential to coordinate personal protection, asset management, and succession across jurisdictions.

Cyprus has introduced significant amendments to its trust beneficial ownership register framework through Policy Statement PS-02-2026, strengthening transparency requirements while maintaining legitimate privacy protections. These reforms clarify reporting obligations for trustees, enhance beneficial ownership identification standards, and align Cyprus with evolving European AML frameworks following landmark CJEU decisions on privacy rights.

The Court of Justice of the European Union's landmark 2022 judgment in cases C-37/20 and C-601/20 fundamentally reshaped beneficial ownership transparency across Europe by striking down unrestricted public access to registers.

The Financial Intelligence Analysis Unit (FIAU) has issued updated Implementing Procedures Part I, introducing significant changes to beneficial ownership identification requirements and employee screening obligations. These amendments affect how subject persons must conduct due diligence on beneficial owners of trusts and legal arrangements, while also modifying the documentation requirements for employee vetting processes.

In this study we shall try to identify how the income of trusts is taxed in Cyprus, having in mind its idiomorphic concept as to the dual separation of the ownership of the trust property, to legal and beneficial.

German tax residents must report worldwide income on their tax returns, including rental income from foreign properties and investment earnings from abroad.

In Italy, trusts are now a well-established tool in wealth structuring for asset protection, succession planning and the orderly management of family and business assets.

On 11 July 2025, Legal Notice 133/2025 came into force, introducing important amendments to the Trusts and Trustees Act (Register of Beneficial Owners).

Expanding a business internationally presents valuable opportunities – but success depends on structure and foresight.