«Taxation of trusts in civil law jurisdictions»

Liechtenstein is one of the few countries under civil law to have integrated the concept of trusts into its own law. This has been regulated by the Liechtenstein Persons and Companies Act (PGR) since 1926. A trust pursuant to Article 897 PGR allows a settlor to transfer movable or immovable property to a trustee who manages it in his own name for the benefit of third parties. Liechtenstein trusts are not subject to any rules against inalienability and can be set up as purpose trusts for ecclesiastical and charitable purposes. The trust creator may retain certain rights and powers as long as the trust remains valid. The international recognition of Liechtenstein trusts is reinforced by the Hague Convention. A reform of Liechtenstein trust law aims to make it modern and internationally competitive. A comprehensively revised Trust Act is intended to meet national and international requirements and strengthen the legal framework.

Topics in the publication

• Recognition and legal framework of trusts in Liechtenstein
• Functions and structure of Liechtenstein trusts
• International recognition and legal aspects
• Comparison with similar concepts under civil law
• Reform of Liechtenstein trust law
• Tax aspects of trusts
• International taxation issues
• Summary and outlook for future developments