Trusts and Foundations

Trusts and Foundations have an important role in the holding of wealth, particularly if you have assets outside of the UAE. In the right circumstances they can allow wealth to be preserved, protected and effectively passed onto future generations. So, whether you require estate management, succession planning or asset protection, Trusts and Foundations are a beneficial way to protect your assets in safe and tax neutral jurisdictions.

Even though Trusts and Foundations hold a similar end goal for the client, they both have their differences and largely depend upon the type of Trust/Foundation, and location of the structure.

What is the difference?

A Foundation is a term commonly used to refer to a separate legal entity without needing other members or shareholders, established under the wishes of a founder, whereas, a Trust is a legal arrangement by deed and not a registered entity. It is formed for the purpose of placing assets onto the name of a trustee, who holds the legal title of assets for the benefit of its intended beneficiaries.

Trust

  • It does not need to be registered
  • Trust deed is not public, and it can be confidential
  • Split between legal ownership and equitable ownership
  • Assets are to be placed in the Trust
  • The Trust is not a legal entity, and so rights fall upon the trustees

Foundation

  • It needs to be registered to exist
  • Foundation itself owns the assets
  • Does not need assets to be placed in the Foundation
  • Foundation can sue and can be sued in its name
  • Foundation Charter is public

At Alderley Global, we have experienced Trust professionals to help you effectively set up a Trust or Foundation.

 

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