# Liechtenstein Foundation (Stiftung): Family Foundation and 12.5% Tax > Liechtenstein Stiftung under PGR (Art. 552): family foundation without members, privacy through deposit, beneficiary types, 12.5% tax and PVS status, Pillar Two impact. Author: Мария Плотникова — юрист, Family Office (https://wiki.private.law/authors/plotnikova) Last modified: 2026-07-16T17:48:00.000Z Canonical: https://wiki.private.law/en/liechtenstein-foundation Topics: structures Jurisdictions: liechtenstein Semantic tags: company --- ## History and Origins The foundation appeared in Liechtenstein law in 1926 together with the Persons and Companies Act (PGR); the Anstalt also emerged at the same time. The provisions on [private foundations](https://wiki.private.law/en/private-foundations) were largely borrowed from Swiss civil law and adapted to local conditions. The novelty was that assets could be dedicated to the interests of the founder's own family while retaining separate legal personality and asset protection—a rarity for continental Europe of that era. Over the following decades, the Stiftung became the primary instrument for private capital and accumulated extensive case law. By the late 2000s, accumulated corporate governance issues and international pressure for transparency required an update: a comprehensive revision in 2008, which entered into force on 1 April 2009, rewrote the section on foundations and strengthened beneficiary rights, board duties, and supervisory mechanisms. The modern foundation operates under this version. ## Concept The Liechtenstein Stiftung is one of the oldest and most refined constructs of continental law for private capital. It is a legal entity without members or shareholders: the assets transferred by the founder are dedicated to a purpose and "belong to themselves." Functionally, the foundation is similar to a trust, but is structured as an independent legal person under civil law. ## Legal Basis The foundation is governed by the Persons and Companies Act ([PGR](https://www.gesetze.li/)), articles 552 et seq.; the current version was introduced by the 2008 reform and entered into force on 1 April 2009. The minimum capital is 30,000 francs, euros, or dollars. The foundation is managed by a board (Stiftungsrat); at the founder's discretion, a protector and auditor may be added. Management is structured through the foundation board (Stiftungsrat): a minimum of two members, and at least one must be a licensed Liechtenstein Treuhänder or equivalent person under article 180a PGR—such a manager is supervised by the Financial Market Authority and bound by due diligence and AML rules. The founder's will is recorded in the statutes (Statut) and a confidential regulation (Beistatut), which describe the beneficiaries and distribution procedures; the founder may reserve certain powers, and if necessary, a protector and auditor are added. The mandatory local manager ties the structure to real [substance](https://wiki.private.law/en/economic-substance) in the jurisdiction. ## Family Foundation and Privacy For private capital, a family foundation (Familienstiftung) is used. Charitable foundations are supervised by the Foundation Supervision Authority (STIFA); private family foundations are exempt from ongoing state supervision and may only be subject to inspection voluntarily. A private foundation is not entered in the public commercial register—its deed of foundation is deposited with the Office of Justice, ensuring the structure's privacy. The PGR distinguishes between pure and mixed family foundations: a pure Familienstiftung directs income exclusively to the maintenance and education of family members, while a mixed one directs income primarily to the family but allows for charitable or other private purposes. This qualification determines the supervisory regime. Privacy here should be understood precisely: the deed of foundation is indeed not entered in the public register, but information about the [beneficial owner](https://wiki.private.law/en/beneficial-ownership-nominee) is entered in the non-public [Register of Beneficial Owners (VwbP)](https://www.llv.li/en/national-administration/office-of-justice/foundation-supervision-and-anti-money-laundering-stifa-gwp/register-of-beneficial-owners-vwbp), accessible to authorities, and the foundation itself reports under [CRS](https://wiki.private.law/en/crs-overview). For external observers, the structure remains closed, while for tax authorities it is transparent. ## Beneficiaries The circle of beneficiaries is flexible. The law distinguishes several types: entitled beneficiaries with a direct claim to benefits; expectant beneficiaries who will become entitled in the future; discretionary beneficiaries whose benefits depend on the board's discretion; and final beneficiaries who receive the remainder upon liquidation. This allows the founder to finely tune distribution across generations. > 💡 The foundation board (Stiftungsrat) manages the assets according to the founder's will, recorded in the statutes and supplementary regulations. A clear description of beneficiary classes reduces the risk of future family disputes. ## Application: Typical Scenarios The most common motive is succession planning. The founder consolidates scattered assets into a single independent entity that outlives the founder: assets pass to subsequent generations according to predefined beneficiary classes, bypassing fragmentation through multiple national inheritance procedures. This is especially valuable for families whose assets and heirs are located in different countries. The second scenario is ownership of a [family business](https://wiki.private.law/en/business-succession). The foundation holds shares in a holding company, separating ownership from operational management and protecting the group from forced sale during generational transitions; it is often combined with a PTC or underlying [holding](https://wiki.private.law/en/holding-structures). Related uses include capital protection ([asset protection](https://wiki.private.law/en/asset-protection-trusts) after challenge periods expire) and holding cross-border portfolios—securities, real estate, art, and equity interests—under a single structure. > 🧭 The foundation is particularly appealing to families from civil law countries where trusts are unfamiliar: it provides comparable separation of ownership and control in the form of a registered legal entity that their banks and courts understand. ## Taxes: 12.5% and PVS Status Resident foundations pay a 12.5% corporate tax on worldwide income with a minimum tax of 1,800 francs per year. If the foundation merely owns and manages private assets and does not conduct economic activity, it can obtain Privatvermögensstruktur (PVS) status and pay only the minimum tax. Liechtenstein is part of the EEA, participates in CRS, and has a network of tax treaties, so it is perceived as a "white" jurisdiction. ## Evolution of the Regime and Its Regulation The current tax profile of the foundation took shape after the 2011 reform. Previously, Liechtenstein divided companies into ordinary and domiciliary (Sitzgesellschaft) with preferential treatment, but these privileges contradicted EEA state aid rules. The new tax law, which entered into force on 1 January 2011, abolished this division and introduced a uniform 12.5% rate, and the Privatvermögensstruktur regime was recognized as compatible with EEA law by the EFTA Surveillance Authority on 15 February 2011. Thus the foundation became an instrument of a "white" jurisdiction: a predictable regime, mandatory licensed manager, extensive network of tax treaties, and full tax information exchange. This means the structure does not automatically raise questions from banks and counterparties, distinguishing it from classic offshore jurisdictions. When planning, the foundation is often considered alongside [Liechtenstein residence](https://wiki.private.law/en/liechtenstein-residence) and compared with the [Panama foundation](https://wiki.private.law/en/panama-foundation) or Austrian Privatstiftung. > ⚙️ Practical consequence of the reform: PVS status requires maintenance—the foundation must remain a passive asset holder and not conduct commercial activity, otherwise it loses the right to the minimum tax and is taxed at 12.5%. ## Pillar Two and Application > 🔗 **Related** > [Private Foundations](https://wiki.private.law/en/private-foundations) · [Liechtenstein Residence](https://wiki.private.law/en/liechtenstein-residence) · [Panama Private Foundation](https://wiki.private.law/en/panama-foundation) · [Trusts (Singapore)](https://wiki.private.law/en/trust-singapore) · [Succession Planning](https://wiki.private.law/en/succession-planning) · [Asset Protection Trusts](https://wiki.private.law/en/asset-protection-trusts) Since 1 January 2024, Liechtenstein has applied the [global minimum tax](https://www.llv.li/en/national-administration/fiscal-authority/international-tax-law/minimum-taxation-globe-pillar2) (Pillar Two / GloBE): a domestic QDMTT and IIR rule at a 15% rate. These rules only affect large international groups with consolidated revenue of €750 million or more, so they do not apply to ordinary private family foundations—for them, the basic 12.5% continues to apply, and for PVS only the minimum levy. > 🍓 The Liechtenstein Stiftung combines century-old practice, private foundation privacy, and moderate taxation: 12.5%, and for PVS only the minimum levy. It is one of the most respected succession planning instruments in Europe. This material is for expert informational purposes and does not constitute individual tax or legal advice. --- --- ## Factual claims - The foundation appeared in Liechtenstein law in 1926 together with the Persons and Companies Act (PGR); the Anstalt also emerged at the same time. - Over the following decades, the Stiftung became the primary instrument for private capital and accumulated extensive case law. - The Liechtenstein Stiftung is one of the oldest and most refined constructs of continental law for private capital. - The foundation is governed by the Persons and Companies Act (PGR), articles 552 et seq.; the current version was introduced by the 2008 reform and entered into force on 1 April 2009. - Resident foundations pay a 12.5% corporate tax on worldwide income with a minimum tax of 1,800 francs per year. - The current tax profile of the foundation took shape after the 2011 reform. - Since 1 January 2024, Liechtenstein has applied the global minimum tax (Pillar Two / GloBE): a domestic QDMTT and IIR rule at a 15% rate.