Country code – GG
Legal Basis – Mixed (Customary, French civil and Common)
Legal framework – The Foundations (Guernsey) Law 2012
Regulatory board - Guernsey Financial Services Commission
Entity – Foundation
Liability - A foundation has its own separate legal personality, the properties and resources of it constitute an independent patrimony from that of the Founders, the Foundation Council members, Protector, and Beneficiaries.
Dedication of assets – Must have an initial endowment, provided by the Founder. The legislation doesn't stipulate a minimum capital sum however a description of the initial endowment must be included in the foundation's charter.
Founder – The founder of a Guernsey foundation may determine the purpose of the foundation, craft the foundation’s Constitution and must endow it with its initial capital, appoint the initial councilors and if any, the guardian.
The founder may be a council member or a guardian (but not both simultaneously) in addition to being a beneficiary. A founder can reserve the power to amend, revoke or vary the terms of the foundation’s Constitution or its purpose and reserve the power to terminate the foundation but only if these powers are fully detailed in the foundation’s Charter. Founder details may not be publicly available.
Foundation Council – The Council manages the Foundation and it is comprised of at least two councilors unless the Constitution permits a single councilor. The founder or any person (including a body corporate) may be appointed as a councilor but a may not also be a guardian of the foundation.
Councilors of a foundation owe their duties to act in good faith in the exercise of their function to the foundation itself rather than the beneficiaries. Corporate councilors are allowed. Councilors details are publicly disclosed.
Guardian – Only requires a Guardian where there is a purpose in respect of which there are no beneficiaries or there are "disenfranchised beneficiaries", Guardian otherwise optional.
The guardian of a Guernsey foundation also owes a duty the founder and beneficiaries to act in good faith to enforce the Constitution and the purpose and exercise his functions. Its details may be publicly disclosed.
A corporate body may act as a guardian, and its details may be available to the public.
Beneficiaries – A beneficiary is entitled to benefit from the foundation and is either identified in the foundation’s Constitution by name, or whose identity is ascertainable as a member of a class or by their relationship to another person. Beneficiaries have the right to confidentiality.
Guernsey law draws a distinction between "enfranchised beneficiaries" (those with a right to receive certain information about the foundation), and "disenfranchised beneficiaries" (those that have no such right to information), provided for by the foundation's constitution. The provisions allow movement between the two categories of beneficiaries, ensuring some flexibility.
Regulated Person – Unless a Guernsey-based licensed fiduciary is appointed to act as a council member or the guardian. A Registered agent is required who must be a Guernsey-based licensed fiduciary or authorized person.
Foundation Charter - A foundation must have a valid charter at all times. The charter must state the name of the foundation, its lawful objects, information regarding winding up, dissolution and its term, detail of the initial endowment and if proceeds, a statement that it may be endowed further.
Optionally, the Charter may contain any other matter that the founder thinks fit, or that would otherwise be required or permitted to be in the Rules.
Rules – The rules of a Foundation must prescribe the functions of the Council; detail the procedures for the appointment, resignation and removal of the councilors and any guardian; and details how the councilors or guardian are to be remunerated.
Optionally, the rules may prescribe the manner in which the property of the foundation may be distributed, accumulated or applied; detail whether, and if so, how, further property may be endowed upon the foundation; provide for the addition or removal from benefit of persons or beneficiaries – either revocable or irrevocably; detail any person’s (including the founder’s) powers in relation to the foundation; impose obligations upon beneficiaries as a condition of benefit; make the interest of a beneficiary liable to termination or subject to certain restrictions; give the details of a default beneficiary.
Re-domiciliation – "Recognised entities" including Bahamas Foundations, Liechtenstein Anstalts & Stiftungs, Panama Private Interest Foundations St Kitts Foundations and Nevis Multiform Foundations, may continue as Guernsey foundations.
Mergers - There is no ability for a Guernsey foundation to merge with any other entity.
Charitable/Philanthropic Purposes - Permitted.
Compliance – The foundation must retain the following documents and records in its Business address: the constitution, accounting records and all other documents filed with the Registry.
The Council is responsible for ensuring that the foundation keeps records and accounts that are sufficient to show and explain the foundation’s transactions, the financial position of the foundation and also detail the day to day entries of receipts and expenditure, together with the assets and liabilities of the foundation. These records must be kept or be accessible in Guernsey.
- Corporate founder permitted
- Corporate council members permitted
- Protector/Guardian required
- Local regulated person required
- Founder not disclosed in a public registry
- Council members not disclosed in a public registry
- Protector/Guardian not disclosed in a public registry
- Beneficiaries not disclosed in a public registry
- Beneficiaries have right to information
- Merge permitted
- Redomiciliation permitted
- Charitable purposes permitted
- Registered agent required
- Mixed (Customary, French civil and Common) Legal basis
- - Initial endowment of assets
- 1 Minimum council members
- £100 or £350 (2 hour registration) Registration fee
- £500 Annual government fee
- 2018 AEOI
Guernsey foundations are treated as tax neutral in Guernsey. Tax advice is recommended on how the foundation might be treated in the founder’s, council members’ and beneficiaries’ own country of residence for tax purposes.
- Offshore Income Tax Exemption
- Offshore capital gains tax exemption
- Offshore dividends tax exemption
- CFC Rules
- Thin Capitalisation Rules
- Patent Box
- Tax Incentives & Credits
- Property Tax
- Wealth tax
- Estate inheritance tax
- Transfer tax
- Capital duties
- 0% Offshore Income Tax Rate
- 0% Corporate Tax Rate
- 0% Capital Gains Tax Rate
- 0% Dividends Received
- 0% Dividends Withholding Tax Rate
- 0% Interests Withholding Tax Rate
- 0% Royalties Withholding Tax Rate
- 2 Losses carryback (years)
- Indefinitely Losses carryforward (years)
- 20% Personal Income Tax Rate
- 0% VAT Rate
- 0 Tax Treaties
The Bailiwick of Guernsey is a dependency of the British Crown located in the English Channel, specifically to the west of the coasts of Normandy, France.
The territory comprises the island of Guernsey (which forms the largest part) and its neighboring islands Alderney (2400 inhabitants), Sark (610 inhabitants) and Herm (60 inhabitants), as well as other very small islands such as Jethou, Brecqhou, Burhou, Lihou, and other islets.
Guernsey is part of the Channel Islands archipelago together with the Jersey Bailiwick. Although his defense is the responsibility of the United Kingdom the bailiwick is not part of it, but a possession of the British Crown.
Its population is about 65,000 inhabitants, of which 17,000 live in its capital, Saint Peter Port.
The native population has as its mother tongue French, more exactly a subdialect of the Norman dialect. However, the most widely used language today is English.
Its official currencies are the Guernsey Pound (GGP)) and the Pound sterling (GBP).
The head of state is the British Queen Elizabeth II of the United Kingdom represented by the lieutenant governor.
The Guernsey Parliament officially called the Deliberative States and chaired by the Bailiff, are composed of 45 deputies, elected in districts of one or more representatives every four years. There are also two representatives of Alderney, an independent dependency of the Bailiwick, but Sark does not send any representative. There are also two non-elected members, both appointed by the monarch as legal officers and without a vote.
About a third part of its gross national product is supported by financial services (banking, fiduciary, captive insurance, and fund management). Other traditional sources of income are agriculture, tourism, optical, engineering and horticulture, mainly tomatoes and cut flowers. Major imports include coal, gas, oil, electricity, machinery, and equipment.
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