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Compare Offshore Foundations – Table

What is an Offshore Foundation?

An foundation is a separate legal entity and is commonly created under civil law. A foundation does not have members or shareholders. An offshore foundation is one formed outside of the founder’s country of residence. To start, let’s talk about terms associated with foundations.

The  founder is the title of the one who establishes the entity. His or her wishes, in turn, are written in a document we call a “Charter.” Most offshore foundations can have one or more founders. A founder can be a person or a company.

Additionally, the foundation council consists of people who act out the purpose of the entity as indicated in the charter. As such, they distribute and administer assets, sign agreements and make investments on the foundation’s behalf. Counsel members have a fiduciary duty to act in the best interest of the foundation.

A foundation can have a beneficiary or a purpose or both. A beneficiary is a person or class of persons for whom the foundation is created. The purpose, on the other hand, indicates the reason or cause for which one formed the foundation.

Furthermore, there are positions that are optional. Optional positions are guardians or protectors. These are people whose role is to ensure that the counsel acts in compliance with the terms and conditions of the charter.

Foundation vs. Trust

Now, let’s compare a foundation to a trust. To clarify the above, civil law, also known as civilian law, refers to a system of laws originating on the European mainland.  Roman law established significant roots in the civil law framework. Trusts, on the other hand, are products of common law.

A trust, or offshore trust, in this context, is a product of common law. Common law has its foundations in England and migrated to countries such as the United States, Canada and Australia. The purpose of a trust is for a trustee to hold assets for the benefit of trust beneficiaries.

What Does an Offshore Foundation Do?

People use offshore foundations for charitable purposes as well as commercial and personal uses. Many people now also use it, in modern times, for asset protection, estate planning and tax savings. In many offshore jurisdictions, a foundation is free from taxes. Naturally, if one is a citizen of or resides in a country that taxes worldwide income that person is well-advised to seek licensed tax advice.

The first foundations were established in Liechtenstein more than one hundred years ago. Since its origination in this Western European country, people have established thousands of foundations in countries around the globe. Because of its European roots many people call them “Anglo Saxon Trusts.”

Private Interest Foundation

A private interest foundation contains the benefits of a company with the asset protection benefits of a trust. The foundation owns the assets. These assets remain tax free within the foundation until the foundation distributes them. Naturally, this is a very general statement which invites licensed tax advice.

Offshore Foundations Comparison Table

Below is a comparison table showing the features and benefits of various common offshore foundations. Meanwhile, if you have questions, you can fill out the consultation form on this page or utilize one of the phone numbers displayed above.

Foundations Comparison Table ANGUILLA BELIZE NEVIS PANAMA
Name of Foundation Law Anguilla Foundation Act International Foundations Act Multiform Foundations Ordinance Panama Foundation Law
Year law enacted 2008 2010 2004 1995
Tax Free Entity? Yes Yes Yes Yes
Requirements for Tax Free Status

(This refers to local taxation. The tax laws in your jurisdiction may vary.)

    • Founder and beneficiaries are non-residents
    • Must locate assets abroad
  • Founder and beneficiaries are non-residents
  • Must locate assets abroad
  • Founder and beneficiaries are non-residents
  • Must locate assets abroad
  • Founder and beneficiaries are non-resident
  • Must locate assets abroad
  • May include shares, securities or interest of Panama corporations if capital is not from Panamanian sources
Does the foundation have a legal status? Yes Yes Yes Yes
Foundation Types Charitable Yes Yes Yes Yes
Non Charitable Yes Yes Yes Yes
Ordinary (no -purpose) Yes Yes Yes Yes
Partnership No No Yes No
Company No No Yes No
Trust No No Yes No
Uses of Foundation Family Yes Yes Yes Yes
Business Yes Yes Yes with the following:

· Prescribed foundation
· Trust foundation
·Partnership foundation
· Company foundation may engage in activities allowed by such vehicles

A Panama Private interest foundation is not a for-profit entity. Use a corporation for  this purpose instead.
Commercial Yes Yes Yes No
Philanthropic Yes Yes Yes Yes
Charitable Yes Yes Yes Yes
Holding Yes Yes Yes Yes
Revocability (Irrevocable/revocable) Irrevocable upon registration; founders may revoke. Irrevocable upon registration unless the charter specifies revocability Not required for registration, can be revocable or irrevocable. Irrevocable upon registration unless the charter specifies revocability
Formation Features of the Foundation
Founder (the person requisitioning the foundation) Required Required — also called the Promoter Required In Panama the Founder is a local agent. Agent registers the foundation and has no interest in (ownership of) the foundation.
Minimum # of required founders 1 1 1 1
Can founder be a Beneficiary? Yes Yes Yes No
Foundation Council (executive arm) Council Required Council Required Council Required — is called the Management Board Council Required
Minimum # of council members 1 1 1 3
Corporate members allowed? Yes Yes Yes Yes
Other Member Requirement At least 1 member must be a Belize resident ( can be agent)
Beneficiary Types of Beneficiary Any class of person or persons, and can be identified by name, class, relationship, and can be unborn.
Can change beneficiaries? Yes Yes Yes Yes
Limits to the number of beneficiaries? No No No No
Documentation required for Registration? Yes — Declaration of Establishment DOE Yes — Foundation Charter Yes — memorandum of Establishment (MOE) Yes — Foundation Articles
Contents of Documentation
    • Foundation name
    • Founder name and address
    • Foundation purpose
    • Registered agent name
    • Council member name and address
    • Initial asset value
    • Beneficiary information
    • Secretary name
    • Details of persons on first council
  • Foundation name
  • Founder name and address
  • Foundation purpose
  • Registered agent name
  • Council member name and address
  • Initial asset value
  • Beneficiary information
  • Secretary name
  • Details of persons on first council
  • Foundation name
  • Founder name and address
  • Foundation purpose
  • Registered agent name
  • Council member name and address
  • Initial asset value
  • Beneficiary information
  • Multiform details
  • Duration of foundation
  • Whether revocable or irrevocable
  • Secretary name
  • Details of members on first management board
  • Details of persons who are to be the first supervisory board
  • Foundation name
  • Founder name and address
  • Foundation purpose
  • Registered agent name
  • Council member name and address
  • Initial asset value
  • Beneficiary information
  • Secretary name
  • Details of persons on first council
Is this a public document No No No Yes
Registered agent required? Yes Yes Yes Yes
Registered address required? Yes Yes Yes Yes
By-Laws required? Optional Optional Required Required
Secretary required? Yes, must be an Anguilla Resident or agent. It cannot be sole member Yes, unless one council member is a Belize resident, can be the agent Yes, cannot be a sole member Yes, and are provided by agents
Is there an alternate custodian? Yes – a Guardian Yes, a Protector –  cannot be a member Yes – a supervisory board Yes – a Protector
Allowed duration of foundation Specified period or Indefinite Specified period or Indefinite Specified period or Indefinite Specified period or Indefinite
Document language Any with an English translation Any with an English translation Any with an English translation Any language with a Spanish translation
Can one change the foundation? Yes. Founder can change or revoke the foundation with unanimous agreement from members. Must be provisioned for in the DOE Yes. Founder can change or revoke the foundation with unanimous agreement from members. Must be provisioned for in the DOE Yes. Management Board may make changes or amendments to the constitution by resolution of the board, the beneficiaries or the supervisory board Yes. Can make changes or amendments to the charter.
Initial endowment US$10,000 US$10,000 not specified US$10,000
Administrative Features of Foundation
Meetings required? No, unless required in the by-laws No, unless required in the by-laws Yes – multiform must hold at least one annual meeting No, unless required in the by-laws
Accounting or record keeping required? No No Yes (must show sales, purchases, income expenses and receipts) No
Information is on the register Name of foundation

Name and address of agent

Date of registration

Purpose of foundation

name of council members

Name of foundation

Name and address of agent

Date of registration

Purpose of foundation

Name of foundation

Name and address of agent

Date of registration

Purpose of foundation

name of council members

Name of foundation

Name and address of agent

Date of registration

Purpose of foundation

name of council members

Is a Certificate of Registration issued? Yes Yes Yes Yes
How often are foundation renewals Annually Annually Annually Annually
Is a Certificate of Good Standing issued? Yes Yes Yes No
Law protects confidentiality? Yes Yes Yes Yes
Restrictions? The foundation may NOT engage in banking trust or insurance financial services UNLESS licensed to do so The foundation may NOT engage in financial services UNLESS licensed to do so Only legal activities. The foundation may not carry out habitual or regular commercial activities

If you have questions, please fill out a free consultation form on this page or call one of the numbers above.

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Last Updated on March 16, 2019