Foundation Services FAQ's
What is a foundation?
Foundations are a combination of a trust and a company. They are created by the registration, at the public registry, of the 'Charter'. Upon registration, they obtain separate legal personality.
Do foundations have shareholders?
No. Foundations have no shareholders but because they are registered entities, they create absolute certainty, similar to a company.
Who can set up a foundation?
The founder can be an individual or a corporate entity.
What are the advantages of a foundation?
They are extremely flexible and more acceptable in civil law jurisdictions, where trusts may not be recognised.
Furthermore, foundations:
- Due to their flexibility, can act as a safe holding vehicle to active underlying structures thus providing an orphan or independent structure
- Give clients greater control over assets without the fear of creating constructive management and control
- Simplify and enhance the transparency of wealth-holding structures
- Provide tax-efficient inheritance planning and asset protection entities.
Do foundations have a time limit?
Foundations can be established for either a fixed or an indefinite time period.
Who can benefit from a foundations?
Because of their structure and global recognition, foundations suit those who:
- are high-net-worth individuals (HNWIs), by ensuring assets are managed and controlled in a tax-neutral jurisdiction
- want a balance between transparency and privacy
- need security against economic or family issues
- are from civil law jurisdictions where the concept of trusts may not be known.
Do I have to pay tax on a foundation?
As long as the foundation is established in a suitable offshore jurisdiction, no tax is payable on the assets held within it, provided those who benefit from the foundation, are not resident in such offshore jurisdiction.
Are foundations recognised globally?
Yes. Foundations are recognised in many civil law and common law jurisdictions and in certain jurisdiction are protected by International Private Law.
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