The Liechtenstein Foundation

Foundations have a long tradition in Liechtenstein and have proven themselves for decades as a multifunctional instrument for asset management, succession planning and philanthropic purposes. This brochure provides an overview of the legal framework, establishment, administration and tax aspects of Liechtenstein foundations and is intended to provide founders, beneficiaries and experts with clarity and understanding.

A foundation is a legally and economically independent special-purpose asset that is established by the founder's declaration of intent. The foundation's assets are separated from the founder's private assets. The purpose of the foundation, which is determined by the founder, can be charitable or private. The foundation is established either by a declaration of foundation during the founder's lifetime or by testamentary disposition. The foundation capital must be at least CHF/EUR/USD 30,000. As a rule, foundations may not engage in any commercial activity unless it serves to achieve the purpose of the foundation. Management is carried out by the foundation board, which manages the assets in accordance with the purpose of the foundation, supported by possible additional bodies such as a protector or advisory board. As legal entities, foundations are subject to an income tax of 12.5%. For tax purposes, a distinction is made between transparent and non-transparent foundations, depending on their right of revocation. The taxation of foundations under Liechtenstein tax law is attractive and significantly promotes the accumulation of assets over time.

Topics in the publication

• General characteristics of a Liechtenstein foundation
• Purpose of the foundation
• Establishment of the foundation
• Administration and supervision of the foundation
• Beneficiaries
• Dissolution, termination
• Taxes