In these countries, a foundation is associated only with a charity, along with its status of a charitable organization. The funds of such an organization are raised through grants and donations from persons who will not receive any profit, as the funds will not be put toward their private goals.
The concept of a private foundation was born in Liechtenstein over a hundred years ago, as a tool to secure assets and plan financial succession. This form of a foundation isn’t yet popular in Western European countries, but it is important to note that it is enjoying increasing interest. However, due to legal regulations in some Eastern European Countries, it isn’t possible to benefit from legal foundations and we still have to make use of the options prepared by other European countries with a lot of experience in this matter. In many European countries, alongside charity foundations, there are also private foundations.
Setting up a private foundation is an element in planning the future of the assets at present, but also after the founder’s death. A foundation abroad operates much differently than a charity foundation in Poland or other Eastern European countries. It’s a legal entity and it can own assets. A private foundation works in a similar way to a company, although it should be noted, that a private foundation has neither members nor shareholders. In many European countries, the activity of a foundation is regulated through legal acts. Examples of countries with complex legislation pertaining to foundations include the Netherlands, Liechtenstein and Austria. However, despite some statutory limitations, there is a lot of freedom when its comes to the composition, as well as appointing and removing an administrator. The founder can voluntarily decide on statutory purposes of their foundation.
Our company offers a wide range of solutions in setting up foundations and helping manage them. We advise on how to run a foundation and how to benefit from its assets. How to optimize profit, in terms of taxes, and how to avoid paying inheritance and donation tax.
