LIECHTENSTEIN Law and Practice Contributed by: Thomas Plattner and Fabian Jenny, Ospelt & Partner Attorneys at Law Ltd.
beneficiary designations under life insurance policies, which fall outside the estate and can be freely directed to the partner.
should be higher than the costs. As no further specific requirements regarding the ratio of costs to distribu - tions or detailed distribution ratios are imposed, this seems to be an advantage of the location compared to other jurisdictions whose more detailed require - ments can often only do limited justice to the diversity of reality. In principle, existing charitable foundations can trans - fer their registered office to or from Liechtenstein, pro - vided that a comparable supervisory regime can be demonstrated. Accordingly, existing charitable foun - dations from abroad are often relocated to Liechten - stein. Liechtenstein included a new option for philanthropic activities in 2015, the “protected cell company” (PCC). The PCC is a new organisational form under company law for existing legal entities or entities to be estab - lished. It is possible to set up a PCC as an umbrella organisation to pursue charitable purposes. Apart from the core element, the foundation as a PCC consists of one or more cells, also called segments. The assets of the individual segments are separated from each other and from the assets of the core ‒ and remain separate. Each of the segments is subject to its own area of activity or purpose, which is described in more detail in the documents of the charitable foundation. One segment may be dedicated to environmental pro - tection and another to pursuing social causes. Spe - cific assets are allocated to each segment to achieve the purpose. One advantage of this new option for structuring a charitable foundation is, inter alia, limited costs and structuring of asset classes and purposes.
10. Charitable Planning 10.1 Charitable Giving
Charitable contributions to legal entities are tax exempt from personal income tax if the receiving per - sons are also exempt from tax liability. The exemption is limited up to a maximum of 10% of the taxable income. Donations exceeding the total amount of CHF300 must be proven by disclosing the receipts. Legal persons that serve only charitable purposes to the exclusion of any commercial activity are tax- exempt, eg, charitable foundations or trusts. 10.2 Common Charitable Structures Liechtenstein offers a good environment for charitable structures. The total number of charitable foundations in Liechtenstein increased up to a total of 1,400 char - itable foundations registered with the Liechtenstein Foundation Supervisory Authority. Liechtenstein foundation law is characterised by the liberal attitude. Liechtenstein law does not impose any restrictions on the geographical area of activity of Liechtenstein charitable foundations. Even in the case of tax exemption, there is no requirement that a certain portion of the distributions must remain in the country. The prohibition on self-purpose foundations in Liechtenstein requires that charitable foundations are active externally. This means that the distributions
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