Comparison
Foundation in Switzerland or Liechtenstein? The comparison
Updated: · Leutrim Miftaraj, FLIORE · Editorial standards · Other languages: Deutsch · Français · Español
Short answer
The Swiss family foundation may only be used for specific purposes such as upbringing, endowment or support; pure maintenance payments are not permitted. The Liechtenstein foundation is more flexible: it can also provide unconditional benefits to the family, set out beneficial interests confidentially in by-laws and obtain the tax status of a private asset structure. That is why many families choose a Liechtenstein foundation for succession.
Purpose and benefits
In Switzerland, Art. 335 ZGB limits the family foundation to upbringing, endowment, support and similar purposes; maintenance foundations are void under case law. In Liechtenstein, the foundation law in the Persons and Companies Act (PGR) also permits maintenance payments and a largely free design of beneficial interests. The Swiss Parliament has instructed the Federal Council, through Motion 22.4445, to lift the ban on maintenance foundations; until the law is amended, the ban continues to apply.
Further differences
- Supervision: Swiss family foundations and private-benefit Liechtenstein foundations are in principle not subject to state supervision.
- Confidentiality: in Liechtenstein, beneficial interests are often set out in non-public by-laws.
- Bodies: in Liechtenstein, frequently a licensed trustee on the foundation board.
- Tax: Liechtenstein offers a possible status as a private asset structure; the taxation of the founder and the beneficiaries follows their respective state of residence.
- Registers: in Liechtenstein, the register of beneficial owners (VwbP); in Switzerland, the commercial register entry, mandatory for family foundations since 2016, and the federal transparency register operated since 1 October 2026, to the extent the foundation falls under it.
The two forms at a glance
| Criterion | Swiss family foundation | Liechtenstein foundation |
|---|---|---|
| Legal basis | Art. 80 ff. and Art. 335 ZGB | Foundation law in the Persons and Companies Act (PGR) |
| Benefits to the family | Upbringing, endowment, support and similar purposes; no unconditional maintenance payments | Unconditional benefits also possible, beneficial interests largely free to design |
| State supervision | None; no auditor (Art. 87 ZGB) | In principle none for private-benefit foundations |
| Disclosure | Entry in the commercial register | Beneficial interests often in non-public by-laws; reporting to the VwbP |
| Bodies | Foundation board according to the foundation deed | Often with a licensed trustee on the foundation board |
| Tax | Taxpayer in its own right; contributions and distributions under cantonal law | Possible status as a private asset structure; those involved taxed in their state of residence |
Decision factors
Besides the purpose, what counts is the residence and tax situation of the founder and the beneficiaries, acceptance by banks, costs and the wish to be close to the administration. The tax treatment of foreign foundations in the family's state of residence is often decisive and must be clarified in advance.
If a Liechtenstein foundation is in fact managed from Switzerland, it can become subject to unlimited tax liability here because of its effective management (Art. 50 DBG). Foundation board resolutions should therefore be passed and minuted where the foundation is meant to be managed; the tasks of a Swiss family office must be clearly delimited from this and set out in writing.
Short checklist
- Define the purpose of the foundation clearly.
- Have the tax treatment in the state of residence reviewed.
- Select the bodies and trustees.
- Settle documentation and administration in advance.
At a glance
| Switzerland | Art. 335 ZGB – restricted purposes, no maintenance foundation |
|---|---|
| Liechtenstein | PGR – maintenance payments also possible, by-laws, private asset structure status possible |
Terms on this page
- Beneficial owner
- The natural person who ultimately owns or controls a company, foundation or trust, or on whose behalf a transaction is carried out.
- Private asset structure (Liechtenstein)
- Liechtenstein tax status for legal entities that exclusively manage their own assets passively; they pay only the minimum income tax.
- Transparency register
- Central register of the beneficial owners of companies and other legal entities.
- Family foundation
- A foundation whose purpose lies predominantly in the interest of one or more families.
Frequently asked questions
Why do Swiss families often choose Liechtenstein?
Because of the more flexible design of the purpose, in particular the possibility of maintenance payments to the family.
Is a Liechtenstein foundation recognised for tax purposes?
That depends on the state of residence of those involved and on the structure; a tax review is indispensable.
Can a foundation be administered from Switzerland?
Yes, administration is often carried out by Swiss family offices in cooperation with Liechtenstein trustees. Where the foundation's decisions are taken should be clarified for tax purposes.
How is the foundation managed in FLIORE?
As a mandate with bodies, beneficiaries, documents and assets – regardless of the country of domicile.
Sources
- Fedlex – Swiss Civil Code (Art. 335 ZGB)
- Liechtenstein law gazette (PGR)
- The Swiss Parliament – Motion 22.4445 (Curia Vista)
- Liechtenstein National Administration – Office of Justice
This page provides orientation and does not replace legal or tax advice. The cited legal sources in their applicable version are authoritative.
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