Liechtenstein private foundation

Updated 7 October 2026

A family foundation next to Swiss banks. We select the licensed council member, draft the articles, pay in the capital and obtain the favourable tax status.

A Liechtenstein private foundation is a legal person to which the founder transfers assets for the purposes set out in its articles: supporting a family, passing wealth to the next generations, holding business stakes. Foundations are governed by the Liechtenstein Persons and Companies Act (Article 552) and handled by the Office of Justice. It is one of Europe's oldest jurisdictions for family foundations, next to Swiss banks and using the Swiss franc.

Below: how much capital is needed, who sits on the foundation council, how a foundation is created and filed, what taxes it pays and why Liechtenstein foundations take longer to prepare than island ones.

Foundation capital

The minimum capital is about $37,000. If the capital is stated in euros or dollars, the minimum is about $34,000 or $30,000. The full capital must be paid in when the foundation is created, and the formation notice confirms this separately. Dollar amounts are converted at the European Central Bank rate of 5 October 2026 and rounded up.

Who runs the foundation

• Foundation council. At least two members; a company can be a member. Unless the articles say otherwise, members are appointed for 3 years and may be reappointed, with or without pay.
• Licensed council member. The council must include a person or company licensed under the Liechtenstein Trustee Act. In practice this is a local trust company responsible for compliance and source-of-funds checks.
• Founder. The founder can reserve rights set out in the articles, such as changing beneficiaries or the articles. The more rights the founder keeps, the closer the tax authorities in their country of residence look at the foundation.
• Beneficiaries. They can be named in the articles or in a separate internal document. Beneficial owners and beneficiaries are recorded in the register kept by the Office of Justice.

How a foundation is created and filed

A private foundation that does not carry on a commercial business is usually not entered in the commercial register. Instead, the council members file a formation notice with the Office of Justice within 30 days of creation. The filing fee is about $370. Foundations that are required to register are entered in the commercial register.

1. Reviewing the goal. We define the purpose, the beneficiaries, the founder's rights and taxes in the family's countries of residence.
2. Trust company. We select the licensed council member, who checks the founder, the source of funds and the origin of the assets.
3. Articles and internal rules. We draft the articles with purpose and capital, the distribution rules and how the council is replaced.
4. Capital and notice. We pay in the minimum capital and file the formation notice with the Office of Justice within 30 days.
5. Account and assets. We open an account in Liechtenstein or Switzerland and transfer the assets to the foundation.

Documents for setting up a foundation

• passports and proof of address of the founder, the beneficiaries and the protector, if one is appointed;
• documents on the origin of funds and wealth: sale of a business, dividends, inheritance, with bank statements;
• a description of the assets to be transferred to the foundation and the documents for them;
• the articles with the name, seat, purpose, capital and the procedure for appointing the council. Distribution rules usually go into by-laws, which are not filed with the Office of Justice;
• the formation notice: name, seat, purpose, date of formation, duration, council members and confirmation that the capital has been paid in.

No state approval is needed to set up a private foundation. The accuracy of the notice is confirmed by an attorney, trustee or auditor licensed in Liechtenstein, and the Office of Justice issues an official confirmation, which the bank requires.

Timeline step by step

The timeline is set by the source-of-funds checks and the account opening, not by state procedures, so we prepare the bank documents together with the articles.

Taxes

Corporate income tax in Liechtenstein is 12.5%, with a minimum tax of about $2,200 a year. A foundation that only holds and manages family assets and runs no commercial business can apply for private asset structure status. It then pays no income tax, only the minimum tax of about $2,200 a year, and is not subject to an ordinary tax assessment.

The taxes of the founder and beneficiaries in their countries of residence do not depend on the foundation's status in Liechtenstein. We review distributions, controlled foreign structure rules and any tax on transferring assets to the foundation before it is created.

Why a Liechtenstein foundation takes longer

• the trust company and bank check the origin of every significant asset in detail;
• the capital is paid in at once and in full, not after filing;
• the articles are agreed with the bank in advance so the account opens without rework;
• private asset structure status needs a separate application to the tax authority.

Why foundations are refused

• no documents on the source of funds, or documents that contradict each other;
• the founder wants full control, turning the foundation into a nominal shell;
• the bank will not work with the countries linked to the founder or the assets;
• the capital was not fully paid in by the time of the formation notice.

Foundation or trust

If the family prefers a relationship with a trustee, compare it with a trust with a trustee in Switzerland. If you need a foundation in an EU country, look at the Austrian private foundation.

Who a Liechtenstein foundation suits and who it does not

A Liechtenstein foundation is chosen by families with substantial wealth who need an independent owner of assets in a European jurisdiction with the Swiss franc and one of the oldest traditions of private foundations. It suits family holdings, passing wealth across several generations and charity, when the distribution rules must outlive the founder.

A foundation does not suit modest wealth: the minimum capital is about $37,000, and preparation and the council's annual work cost noticeably more than island structures. Nor does it hide the owners: beneficiary information goes into a register available to the authorities.

Restrictions for specific nationalities

Liechtenstein law does not limit the nationality of founders and beneficiaries. But Liechtenstein is part of the European Economic Area and applies the sanctions adopted against Russia and Belarus. Where a founder or beneficiary is a national or resident of those countries, participation in a new foundation is checked against the sanctions rules before the articles are drafted: the citizenship and residence permit of each founder and beneficiary are decisive. Persons on sanctions lists cannot take part. If this concerns your family, ask an expert.

Taxes in the founder's and beneficiaries' countries

If the founder keeps the right to influence distributions or to change beneficiaries, tax authorities in countries with controlled foreign company rules may treat them as controlling the foundation and tax its profit in their hands. Distributions from the foundation are taxed in the recipient's country of tax residence. We prepare notifications and reporting on the controlled foreign companies page.

Which assets go into the foundation

A foundation receives capital from $37,000, securities, company shares and income rights. Foreign property is usually held through a company owned by the foundation. The transfer is documented, after which the assets belong to the foundation, not the founder, so transfer taxes in the country where the assets are located are calculated in advance.

What it costs

We fix the quote in writing before work starts; it depends on the council, the assets and whether private asset structure status with the minimum tax is needed.

What we do

We review the goal and the family's taxes, select the licensed council member, draft the articles and distribution rules, assemble the source-of-funds file, file the formation notice, open the account and, where useful, obtain private asset structure status. The cost depends on the assets and the articles; a manager will calculate it in the chat.

What we do

• Foundation registration and maintenance

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