CLOSE

Foundations aren’t what you think: the little-known Bahamas private wealth structure explained

4 August 2020

Make an enquiry

When you hear the word “foundation” your immediate correlation is probably “charity.” But in the Bahamas, the definition has evolved from the classical philanthropic sense and foundations have become a formidable instrument to assist with private wealth planning.

The Bahamas Foundations Act, 2004 (later amended in 2007) relating to the appointment of a foundation agent, foundation council and the rights of a beneficiary, is a relatively little-known private wealth vehicle. Over the years, we have seen that certain instruments originating from common law jurisdictions may not be recognized in civil law jurisdictions, but foundations are a dependable option due to their non-recognition, meaning they’re not subject to forced heirship statutes applied by civil law countries.

Foundations are often referred to as a “hybrid,” a term used because this instrument has attributes of a trust as well as a company.

Here are the similarities of a foundation to a trust:

And here are the similarities of a foundation to a company:

Coupled with the Bahamas’ stable regulatory framework, foundations are an untapped and practical private wealth option. Get in touch with an expert below to learn more.