Foundations - Tax law and auditing
Family Foundation, Charitable Trust, Foundation with Legal Capacity, Limited Term Trust,...
You are planning to yield assets to a charitable foundation? Or are you interested to incorporate a non-profit foundation - e. g. a family foundation - which will ensure the long-term safeguard of your assets?
What is the reasonable minimum amount to set up a foundation? What are the advantages of it? What should be taken into account when establishing a foundation? You can find a general taxation-overview on this page.
More than 23.876 foundations with legal capacity exist in Germany and of which 712 were newly built in 2020. More than 80 percent of foundations are established with less than 1 million euros in capital.* To incorporate a foundation, there is no specific minimum amount required that has to be allocated to it. However, the lasting and sustainable fulfillment of the foundation's mission has to be ensured according to sec. 80 para. 2 German Civil Code. An exception is the foundation with legal capacity. The basis and subsequent external donations are not subject to income tax. However, they may become subject to inheritance and gift tax.
*Source stiftungen.org - Bundesverband Deutscher Stiftungen
Ask your questions here!
Contact us to arrange an initial consultation at no charge!
Send us your request by clicking here.
We are also looking forward to your call: +49 69 971 231 0.
Our Services
Consulting
- Tax and legal advice on the establishment of foundations
- Audit and support in the drafting of statutes and articles of association with a view to obtaining and maintaining non-profit status in coordination with the tax office and the foundation supervisory authority
- Tax advice on the delimitation and allocation of activities in the various spheres (ideal area, asset management, special-purpose operation and economic business operation)
- Advice in connection with endowments and donations
- Advice on turnover tax, especially with regard to the application of exemption regulations
- Support during tax audits
- Advice on foundation law issues
- Advice on the use of subsidies
- Advice on the liability of board members and protective measures
- Advice on consumer foundations
- Advice and support for restructuring in connection with asset succession (e.g. family foundations)
- Protection of assets against access by third parties (asset protection)
- Replacement inheritance tax planning
- Income tax planning for foundations as well as for beneficiaries
- Cross-border/international fulfillment of charitable purposes
- Restructuring and mergers of non-profit organisations
- Advice in case of loss of non-profit status (misuse of funds or activities not in accordance with the statutes)
- Liquidation of non-profit-making entities
*Legal advice from qualified lawyers
Ongoing support
- Creation of reserves
- Amendment of statutes
- Financial and payroll accounting
- Preparation of tax returns and annual financial statements
- E-balances for non-profit organisations
- Statement(s) of application of funds
- Optimization of the accounting system
- Review of the activity reports
Audit
- Mandatory and voluntary audits of annual financial statements
- Where-used list checks
- Audit of the internal control system
- Examination of the proper use of donations
- Audits according to § 53 HGrG
Charitable or not?
Foundation’s mission is decisive!
The most common form of the foundation is the charitable one. If a foundation pursues a charitable purpose, it is granted the status ‘charitable’ and related tax benefits after it has been audited by the foundation authority and tax office. Charitable foundations can promote, for example, cultural institutions or cancer aid, or they can act on their own behalf.
Private benefit foundations, such as family foundations, do not benefit from a tax exemption. Their mission is solely to secure wealth and provision for the family and thus does not serve the corporate good.
The contributions to the family to secure their provision do not reduce the income of the foundation and are therefore not tax-privileged. They are considered as distributions from corporations. You nonetheless can take advantage of tax benefits. Please click here for further information.
Who to contact
News and tax update
October 2021
Freibeträge bei Kindern: Übertragung nach Trennung der Eltern
Wie können der Kinderfreibetrag und Freibeträge für Betreuungs-, Erziehungs- oder Ausbildungsbedarf nach Trennung der Eltern übertragen werden? Der BFH hat entschieden, dass bei dauernd getrennt lebenden Ehepartnern die Freibeträge nicht allein auf Antrag eines Elternteils übertragbar sind. *Quelle/Fremdlink deubner-steuern.de
Read moreOctober 2021
Verfassungswidrige Steuerzinsen: BMF klärt Verwaltungspraxis
Nachdem das Bundesverfassungsgericht die Höhe der Steuerzinsen ab 2014 für verfassungswidrig erklärt hatte, hat das BMF hierzu ein aktuelles Schreiben veröffentlicht. Erstmalige Festsetzungen von Nachzahlungs- und Erstattungszinsen werden demnach für die Zeit ab 01.01.2019 ausgesetzt. *Quelle/Fremdlink deubner-steuern.de
Read moreOctober 2021
Nießbrauch bei Aktien: So spart man Erbschaftsteuer
Frühzeitig vererben und dennoch Gewinne kassieren – auch beim Aktiendepot kann man einen sogenannten Nießbrauch vereinbaren. Das Ziel: Erbschaftsteuer sparen. So funktioniert Nießbrauch bei Aktien. *Quelle/Fremdlink deutsche-handwerks-zeitung.de
Read moreOctober 2021
Haus geerbt, was nun?
Nicht jeder, der im Testament bedacht wird, lässt gleich die Korken knallen. Denn selbst die tollste Villa kann zur Last werden, wenn sie nicht abbezahlt ist oder die Angehörigen darum streiten. Was dann zu tun ist, ein Überblick. *Quelle/Fremdlink sueddeutsche.de
Read more