Technical article

Which Places Report My Heirs to Their Home Tax Office?

A trust with a Cayman bank or custodian account is reported by that institution to home tax offices.

By Neil Solomon · 3 min read

Picture a couple from the UK with one daughter in Mexico and one son in Spain. They have heard that a trust in a small island place keeps their affairs private. They ask a fair question. If the trust sits offshore, does anyone back home learn about it?

The sources say privacy and reporting are two different things. Here is what they show for the eight offshore places we looked at.

Private from the public, not from tax offices

Most of these places keep no public register of trusts. The Cayman Islands have an optional register for exempted trusts, and it is not public. The British Virgin Islands have no public trust register, and trust records stay confidential unless a law or treaty requires disclosure. Bermuda has none. Belize requires a confidential registration through a trust agent. The Cook Islands file only the trustee's name, the trust's name and the deed date, and not the deed. The Bahamas keep a non-public ownership system.

That is privacy from a stranger looking you up. Reporting between tax offices is a separate system.

Account-information exchange

All eight places have signed the international agreement that sends account details between tax offices. It is called the Common Reporting Standard. Banks and other financial institutions collect details on account holders and send them through their local tax authority to the account holder's home country.

The Cayman Islands' sources add a point that applies widely. A trust with a Cayman bank or custodian account is reported by that institution to home tax offices. So the reporting follows the account, which means the trust's bank, wherever it is.

The US has its own law on foreign accounts, the Foreign Account Tax Compliance Act. Places sign agreements with the US in one of two types. In Model 1, institutions report through the local tax office. In Model 2, institutions report directly, with the account holder's consent.

The eight side by side

The exchange years come from the Organisation for Economic Co-operation and Development (tier A), except the Bahamas, which comes from a Chambers guide (tier B). The Bahamas signed in December 2017. The Cook Islands trustee fee, about US$5,000 to US$7,000 a year according to one trustee (tier C), covers filings of this kind.

What this touches

If a daughter in Mexico or a son in Spain is a beneficiary, the account behind the trust may be reported toward the country where each lives. The rule follows the account holder, so it can reach heirs as well as the settlor.

You might say: "Then what is the point of going offshore?" There can be other reasons, such as the legal strength of the trust or who may serve as trustee, and those are for another article. This one is only about who hears what.

You could ask a trustee: which institution holds the account, which tax offices receive its reports, and what do you send each year?

Did a reporting rule ever surprise you or someone you know? Share it here. Someone else may be about to ask the same thing.

Figures are estimates for planning, based on public data. Date read: October 2026.