Curacao Private Foundation
Curacao lies in the Southern part of the Caribbean, less than fifty miles north of South America and has a population of approximately 150,000. The capital of Curacao is Willemstad which is in the main finance centre and seat of Government. Curacao forms part of the Kingdom of the Netherlands, and is therefore an associate member of the European Union. However, Curacao has full internal autonomy with a parliamentary democracy based on the Netherlands.
Curacaos' main sources of income are considered shipping, tourism and financial services, with excellent communications and air services in place to support this. The local currency is the Guilder, fixed to the US dollar at the rate of US$1: Nafl1.78, The standards of living on Curacao is considered amongst the highest in the Caribbean. The official language is Dutch however; English and Spanish are widely spoken in the business community.
The islands ideal geographical position with its close connectivity and relationship to Europe, its stable political, legal and financial environment make Curacao the ideal financial and logistical focal point for doing business.
The Curacao Private Foundation (also known as: "SPF") is a private foundation that was introduced to offer an alternative to the Anglo Saxon Trust. It is very popular in estate planning and for holding and portfolio investment activities.
The SPF is subject to a minimum of formalities and is a flexible solution with the main characteristics summarized below.
The SPF may not conduct a business. However, portfolio investments and holding activities are not considered an enterprise for these purposes.
The SPF is, like other foundations, a separate legal entity that can own assets and incur liabilities.
An SPF does not have shareholders or members.
Unlike a common foundation, the SPF can make non-idealistic and non-charitable distributions to the incorporators or to others out of its income or out of its assets.
Beneficiaries do not have to be appointed if such appointment is not desired.
Beneficiaries can be appointed/designated in the Articles of Incorporation in very general or very specific terms. The purpose clause could for instance only authorize the foundation to make gifts as and when the advisory board considers this appropriate.
There are no audit or filing requirements regarding the annual accounts.
The SPF is exempt from Curacao profit and dividend withholding tax and is only subject to limited tax filings (generally one profit tax return per 5 years).
No Curacao gift or other taxes are levied when contributions are made to the SPF by non-Curacao residents and/or when distributions are made by the SPF.
EXAMPLES OF USES
Holding of shares
Deferral of income
Minimizing wealth taxes
Preservation of family assets
A private foundation is governed by its foundation charter, its regulations and by the provision of The National Ordinance of October 19, 1998 and it should be noted that:
INITIAL PATRIMONY OR CAPITAL OF THE FOUNDATION
The foundation must have an initial patrimony of at least US$ 5,000, which shall be used only towards the purpose and objectives expressly provided for in the foundation charter.
The founder, who can be either a natural person or a body corporate, organises or creates the foundation. The founder appoints officers and/or the founding members of the foundation council as well as nominating the beneficiaries of the foundation. Typically, the founder will be a Licensed Trust Company or nominated party resident of Curacao, who will be specified in the foundation charter.
THE FOUNDATION COUNCIL
Private foundations have a foundation council, which is the administrative body of the foundation. The council can be compared with the board of directors of a normal company, its role is to help the foundation fulfil and achieve all of the foundation's aims, objectives and purposes, as set out in the foundation charter or in the regulations.
The beneficiary, or beneficiaries, are those that benefit from the private foundation. As the beneficiaries do not need to be named in the foundations charter, the confidentiality or anonymity of the beneficiaries can be achieved.
There are no direct taxes such as income tax, corporation tax, capital gains tax, profit tax, gift tax or death duties.
A Foundation can be registered within five working days but you should allow 3 days for us to receive the paperwork to be forwarded from Curacao.
RESTRICTIONS ON NAME AND ACTIVITY
Foundations can be established for all lawful objects and the name should include the word “Private Foundation”. Words such as Bank, Insurance, Reinsurance or Trust cannot be used in any language.
There is a requirement for a registered office to be maintained in Curacao, together with a Resident Agent.
SCHEDULE OF FEES
Incorporation including Notary and Stamp charges
Provision of domiciliary services to include registered office, registered local agent, secretary and filing of annual returns
as well as the Foundation Council.
Contribution to Chamber of Commerce
FIRST YEAR UP FRONT FEES
SECOND AND SUBSEQUENT YEARS FEESUS$ 1,300
OPTIONAL SERVICES BANK
We can open bank accounts for the foundation in most places in the world and our fees for attending to the account opening procedures would be from US$ 500 plus the costs of preparing any additional notarised documentation which a particular bank may require.
REMAILING, FAX, TEL. AND OFFICE FACILITIES
As part of the domiciliary services package we provide a registered office address in the jurisdiction of the incorporation of your foundation in order to meet the local statutory requirement. However, (unless the foundation is completely dormant) banks, accountants and other service providers may need to write to the foundation and therefore must be provided with a correspondence address. Where Sadekya is providing managers for the foundation the correspondence must be addressed to those managers so that they can deal with that correspondence in the appropriate manner. In such cases the provision of office facilities is a compulsory additional service. Where we are not providing managers the client may choose to have mail directed to his own address but this is rarely advisable as the connection between the client and the foundation will be revealed and it is sometimes not convenient for a client to receive these type of mail. For these reasons we offer to provide remailing and other office services. Faxes, e-mails and telephone calls can be dealt with according to agreement to further ensure confidentiality. Our fee for the provision of this service is US$500 per annum plus handling charges (US$3 per item plus disbursements).