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The Jersey foundation can be used for a variety of different reasons including private wealth management, succession and charitable purposes.
Why use a Jersey Foundation?
A Jersey foundation has some of the characteristics of both a company and a trust which is attractive to those who are more familiar with a civil law jurisdiction. There are 5 key reasons to choose a Jersey Foundation outlined below.
The foundation is a flexible alternative to the traditional common law trust for tax and succession planning. It is particularly more appealing to those from civil law jurisdictions which have forced heirship provisions in their succession legislation.
To hold assets "off balance sheet", to function as a succession planning vehicle. By placing assets in a foundation, founders can avoid the succession rules of their home state and can plan for the seamless devolution of family wealth in a tax neutral environment.
Private trust companies may need to ensure that they have a neutral tax status for the purpose of acting as trustee of a trust receiving income/ gains. This can be achieved by a foundation owning the shares in the private trust company, which effectively "orphans" the private trust company.