St. Kitts Foundations
St. Kitts foundations can now be set up in St. Kitts. The Foundations Act 2003 (No. 8 of 2003), passed in September 2003, was put into effect on January 31, 2004.
This legislation allows to set up private foundations in St. Kitts. Service providers are receiving applications to set up foundations in St. Kitts and some foundations have already been established under this law. Two types of foundations in St. Kitts are Exempt Foundations and Ordinary Foundations.
Advantages of St. Kitts foundations
- Confidentiality and anonymity of beneficiaries. Beneficiary names are not registered publicly.
- Complete tax exemption for foundations that carry out businesses with individuals who are non-residents.
- No minimum capital is required to register a foundation in St. Kitts.
- Inheritance laws do not affect the validity or activities of the foundation`s purpose.
- Inheritance laws applied to founders or beneficiaries domicile will not take effect against the foundation`s assets.
- Registering costs for St. Kitts foundations are very competitive when compared to costs of other jurisdictions.
- A private foundation set up in another country can be transferred to St. Kitts.
- Flexibility for transferring and administering the assets of family members, children, heirs, etc.
- St. Kitts foundations provide a fiduciary framework enabling civil law and common law countries to easily relate to the organized transfer and use of assets by the beneficiaries at the time of the founder`s death, maintaining control of the assets throughout their life.
Since there is no personal income tax in St. Kitts, founders of foundations or beneficiaries are not taxed on income provided to or derived from the foundation. Exempt foundations do not pay stamp taxes on property passed from or to the foundation, so long the property is not located in St. Kitts. Also, stamp taxes are not payed by individuals involved in security transactions of the exempt foundation. Capital gains taxes are not imposed on individuals in St. Kitts meaning that founders or beneficiaries of St. Kitts foundations are not taxed.
The main objective of foundations is providing for the beneficiaries. Under the St. Kitts Foundations Act, the articles of the foundation states how the beneficiaries or entities will be designated. The by-laws of the foundation states the names and identities of the beneficiaries of the foundation. The councillors are responsible for managing the assets of the foundation adequately, ensuring that the interests of the beneficiaries are not at risk. Beneficiaries may request information about the nature and amount of assets of the foundation and carry out their administration. The councillors are expected to provide the beneficiaries with the information requested in a reasonable period of time.
St. Kitts Foundations Guardians
A guardian can be appointed under the St. Kitts Foundations Act. The main responsabilities of the guardian are to ensure that the foundation and its councillors abide by the articles and by-laws of the foundation and by the Foundations Act. The guardian is also expected to supervise the management and conduct of the councillors. The guardian can be a natural person or a legal entity. The founder or beneficiary of a foundation can be appointed as a guardian, however, the councillor may not be appointed a guardian. The Foundation may have more than one guardian. Guardians are not responsible for damages unless there is proof of bad faith.
Characteristics of St. Kitts Foundations
Provisions may be stated in the by-laws, preventing the alienation, bankrupcy, liquidation, seizure, etc. of the assets of the foundation.
Force Heirship Protection
Section 24 of the Foundations Act protecting St. Kitts foundations from forced heirships states that âno foundation governed by the laws of the Federation and no transfer of property to a Foundation which is valid under the laws of the Federation shall be void, voidable, liable to be set aside or defective in any manner by reference to the law of a foreign jurisdictionâ.
Transfer of foundations to or from St. Kitts
Entitites organized in a jurisdiction different from St. Kitts and have the legal characteristics of St. Kitts foundations, may request a certificate of continuance from the registrar of foundations under the St. Kitts Foundations Act. A St. Kitts foundation may also be transferred from St. Kitts with the authorization of a unanimous resolution by the councillors and if it will not affect the foundations creditors. Foundations that have relocated are not exempt from duties or other responsabilities that they had in their former jurisdiction.
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