Foundation is an alternative to the trust and it is established by a founder who transfers assets that will be administered or distributed to the beneficiaries of the Foundation in accordance with the constitution. Foundation can be used for the same purposes as a trust.
As soon as it is established, it forms a separate legal estate and the assets are protected from future claims that may be raised against the beneficiaries.
The formalities regarding the establishment of a Foundation vary depending on the jurisdiction; however little information is publicly available regarding its formation and establishment and the constituent documents, so as to preserve confidentiality.
Advantages of Foundations
- Total exemption of taxes including income tax, wealth tax, real estate tax, inheritance tax, sales and transfer tax and others, in some jurisdictions.
- No legal requirement to disclose the name of the real founder, beneficiary or protector.
- No legal requirement of maximum authorized capital.
- The payment of the foundation capital is not required for the incorporation of the foundation and there is no maximum time or deadline to make such contribution.
- Founders, members of the foundation council, beneficiaries and protectors may be individuals or corporations of any nationality.
- The members of the foundation council need not be founders.
- The founders, the protectors and the members of the foundation council may be beneficiaries of the foundation.
- No limitation regarding the maximum permitted number of founders, members of the foundation council, beneficiaries or protectors.
- The founders and the members of the foundation council may hold their meetings in any country and may be represented by proxy.
- The foundation charter can be signed by an attorney in fact or by a trustee without the need to disclose the name of the founder.
