The Trusts Act 1996 was a replacement for the 1961 Trustee Ordinance modeled after the 1925 English Trusts Act, and contains modern asset protection provisions. Trusts and their beneficiaries receive the same tax waivers as companies, with the similar proviso that all transactions must be confined to non-residents for the trust to enjoy exempt status. Trusts may have a protector but, with the exception of unit, spendthrift and charitable trusts, the protector needs acceptable professional qualifications. Both the settlor and trustees can be beneficiaries of a trust.

St Kitts and Nevis trusts are exempt from income, withholding, capital gains and stamp taxes as long as all transactions are confined to non-residents, and subject to a statutory declaration of exempt status accompanied by an annual registration fee of US$200.

Section XV of the Act makes it clear that beneficiaries do not lose their exemption if trustees are active in the Federation owning or leasing property for an office or residences for beneficiaries, holding meetings, conducting banking, signing employment contracts, and arranging for goods and services.

Every trust must maintain an office in the Federation for service of papers. At least two trustees must be appointed, unless one trustee is a corporation or only one trustee was originally appointed under previous legislation. One trustee must either be a Federation resident or carry on business from an office within the Federation. Trustees' duties include registering the trust with the Registrar of Trusts (who may also be the Registrar of Companies).

Trusts do not have to be audited, unless trust terms call for this. The annual statement filed by trustees need not include any financial information. Strict confidentiality rules for trustees prevail. In response to a written request, trustees may in a "reasonable time" provide information about the trust's financial situation and management to the Eastern Caribbean Supreme Court, Government inspectors, and, subject to the terms of the trust, the settlor, protector, a beneficiary, and a charitable beneficiary.

Every non-charitable trust is restricted to a 100-year life span. No restriction is imposed on charitable trusts. Trust terms should specify how long the trust might accumulate income.

Asset protection provisions, covered in Part V of the Act dealing with a settlor's rights and responsibilities and applicable to all trust, shield the settlor against forced heirship, compulsory division of matrimonial property, and creditors' suits. A creditor who wants to bring a court action against trust property must first purchase a 25,000 East Caribbean dollars ($9,250) bond from a Federation financial institution and deposit it with the Minister of Finance to cover all costs should the action prove unsuccessful.

The proper law of the trust is the law of the jurisdiction expressed by the trust's terms as the proper law; or, failing that, implied from the trust's terms; or failing either, the jurisdiction with which the trust at the time it was created had the closest connection.