Jersey

The Island of Jersey, a British Crown Dependency located in the Channel Islands, offers a distinct legal vehicle for asset structuring and succession planning in the form of the Jersey foundation. Introduced through the Foundations (Jersey) Law 2009, this legal structure combines characteristics of both trusts and companies, providing a flexible tool suited to a range of private wealth and philanthropic purposes.

While foundations have a civil law heritage, particularly in continental Europe and jurisdictions such as Liechtenstein and Panama, Jersey’s framework has adapted the concept to fit within its common law context. The Jersey foundation is therefore especially useful for international clients and family offices seeking a familiar structure that operates within a stable and transparent legal environment.

A Jersey foundation is a separate legal entity—unlike a trust, which is a legal relationship rather than a distinct entity. As a legal person, a foundation can hold assets, enter into contracts, sue and be sued in its own name, and is governed by a charter and regulations rather than by shareholders or settlors.

Foundations are created through:

• A Charter, which is a public document that includes the foundation’s name, its objects, initial endowment (if any), and its duration (which may be perpetual or time-limited).
• Regulations, which are a private internal document setting out the operational governance of the foundation, including the appointment and duties of the council and procedures for decision-making.

The foundation must be registered with the Jersey Financial Services Commission (JFSC), and a qualified person—typically a Jersey-regulated trust company—must  act on behalf of the founder during registration.

The foundation must have a name, a registered office in Jersey, and a council responsible for managing its affairs. Once incorporated, the foundation appears on the public register, though limited information (primarily the charter and the name of the qualified person) is disclosed.

Jersey foundations involve several core participants:

Founder: The individual or entity establishing the foundation. The founder may or may not retain powers post-establishment, and does not necessarily have ownership or control rights akin to a shareholder.

Council: This body manages the foundation’s affairs and is functionally similar to a board of directors. At least one member must be a Jersey-resident or a Jersey-regulated trust company. There is no requirement for council members to be beneficiaries or to have a personal interest in the foundation.

Guardian: A mandatory party if the foundation has no beneficiaries, typically required for purpose-only foundations. The guardian provides an oversight role to ensure that the foundation council acts in accordance with the foundation’s objects.

Beneficiaries: Not all foundations have beneficiaries. Where they do exist, beneficiaries do not have fixed interests unless the regulations specify otherwise. The rights of beneficiaries to information or entitlement are defined by the foundation’s constitutional documents.

Importantly, beneficiaries have no ownership interest in the foundation’s assets, reinforcing the entity’s separation from any individual’s personal estate.

Jersey foundations can be established for a wide range of purposes, including:

• Private wealth management: Foundations are often used in estate and succession planning, particularly in civil law contexts where trusts are less familiar. They allow families to maintain control or oversight mechanisms while providing continuity and ring-fencing of assets across generations.
• Charitable or philanthropic purposes: Jersey foundations may be established exclusively for charitable purposes, governed by objects consistent with Jersey’s Charities Law if tax-exempt status is sought.
• Purpose-based arrangements: Foundations can be created for specific, non-charitable purposes (e.g. holding family assets, intellectual property, artwork, or aircraft), which makes them suitable for structuring ownership in a controlled and non-personalised way.
• Corporate structuring: While not typically used for commercial operations, foundations may hold shares in private trust companies, special purpose vehicles, or other investment structures, particularly in family office contexts.

Their flexibility allows Jersey foundations to bridge civil and common law systems in cross-border estate planning.

From a Jersey tax perspective, foundations are treated as corporate entities but are generally subject to the standard 0% rate of income tax unless they have Jersey-source income or are undertaking certain regulated activities. A foundation will only pay Jersey tax on profits from Jersey real estate, local financial services, or trading activity conducted on the island.

There are no capital gains taxes, inheritance taxes, or stamp duties in Jersey on the transfer of assets to or by a foundation, though the tax implications in the founder’s or beneficiaries’ home jurisdictions must be carefully assessed.

Jersey foundations are generally not subject to economic substance requirements under Jersey law, unless they engage in activities that fall within the scope of the Economic Substance (Companies and Limited Partnerships) Law 2019, such as holding company activity conducted through a separate Jersey company. However, international standards on transparency and substance still influence best practice in foundation management, especially in relation to demonstrating genuine purpose, control, and operational decision-making within Jersey.

Jersey foundations provide a modern and adaptable legal structure for managing assets, succession, and philanthropic aims across diverse legal systems. Their appeal lies in their formal legal personality, flexible governance, and ability to hold assets for defined purposes without creating ownership interests in any individual. Supported by a well-regulated fiduciary sector and a stable legislative environment, Jersey’s foundation regime offers both clarity and flexibility for private clients and institutional users alike.

As global standards on tax, transparency, and compliance continue to evolve, Jersey foundations remain a relevant and credible option within the broader landscape of international structuring tools.