Luxembourg has no private or family foundation: the 2013 bill has sat in committee for over a decade, and only public-benefit foundations exist. Families use other tools instead: the SPF for private portfolios, a SOPARFI or SCSp with family articles for companies, a fiducie or recognised trust, and Luxembourg life insurance for succession. Next door, the Dutch STAK and the Belgian private foundation do part of the job.
There is no private foundation in Luxembourg
Luxembourg has no foundation for private or family purposes. A bill for a fondation patrimoniale was filed in 2013, reviewed by the Council of State in 2014 and has sat in committee ever since; the 2023–2028 coalition agreement does not mention it. The only foundation Luxembourg law knows is the public-benefit foundation, reformed by the law of 7 August 2023: a general-interest purpose, at least EUR 100,000 of endowment, an audit and an annual report to the Ministry of Justice.
Families who ask for “a foundation in Luxembourg” usually want three things: to keep assets together across generations, to separate control from economic benefit, and to do it privately and tax-efficiently. Luxembourg offers several tools for each, and its neighbours offer foundations of their own.
Luxembourg does not have a family foundation. It has something more useful for most families: several vehicles that each do one part of the job well.
What Luxembourg offers instead
| Vehicle | What it does well | What it cannot do |
|---|---|---|
| SPF (family wealth company) | Holds a private portfolio; 0.25% subscription tax a year (minimum EUR 1,000, maximum EUR 125,000); no corporate or wealth tax | No treaties or EU directives; no commercial activity, no managing subsidiaries, no direct real estate, no interest-bearing loans |
| SOPARFI with family articles | Holds operating companies with treaty and directive access; share classes, voting rules and usufruct splits for succession | Fully taxable company; needs substance |
| SCSp (family partnership) | Flexible, transparent, private; a general partner keeps control while the family holds the value | Transparent for tax: each partner is taxed at home |
| RAIF or SIF | Pools family and outside money as a fund | Needs an authorised manager; for larger pools |
| Fiducie, foreign trusts | A regulated fiduciary holds assets for the family; Luxembourg recognises Hague-convention trusts | Fiduciary must be a regulated institution; transparent for tax; registered in the trust register |
| Life insurance with a dedicated fund | Strong asset protection, succession outside the estate, tax deferral in many countries | Taxed in the policyholder's country of residence |
| Public-benefit foundation | Philanthropy with legal personality | No private benefit at all |
The SPF after the 2025 tightening
- Who can invest. Individuals managing private wealth, and entities acting only for them, such as family offices or trusts. No institutional investors.
- What it may hold. Financial assets: shares, bonds, cash, fund units, shares in property companies. It may hold participations but not take part in their management.
- New since 2025. The name must include “SPF”, an annual compliance certificate is required, the minimum subscription tax rose to EUR 1,000, and fines reach EUR 250,000 for serious breaches, with loss of status if not fixed within six months.
- Foreign withholding. No treaty access: foreign withholding tax on dividends the SPF receives is usually a final cost.
Neighbours that do have foundations
| Netherlands | Belgium | Liechtenstein | Austria | |
|---|---|---|---|---|
| Vehicle | Stichting; STAK for share certificates | Private foundation | Stiftung | Privatstiftung |
| Private benefit | No payments to founders or board; family payouts a grey zone | Yes, with a disinterested purpose | Yes | Yes |
| Typical use | STAK: control with the board, value with the family | Share certification and succession | Wealth holding | Wealth holding |
| Tax | Assets attributed to the founder, then heirs, for box 3 (APV rules) | Gift tax on entry (5.5% in Flanders); annual tax of 0.15% to 0.45% above EUR 50,000 | Minimum tax CHF 1,800 under PVS status; distributions taxed at home | 3.5% entry tax and 27.5% interim tax from 2026 |
Every one of these is taxed again where the family lives. A foundation abroad does not change the founder's or the beneficiaries' personal tax, and all of them are reported under CRS and the beneficial-ownership registers.
What can do the job for you?
Four questions; the picker suggests vehicles and names their limits.
What can do the job of a foundation for you?
Four questions. You get the vehicles that fit, and what each one cannot do.
The 2013 bill is still in committee; nothing new announced.
Cheap and private, but no treaties and strict limits.
Articles, share classes and usufruct do the foundation's job.
The Dutch standard for separating control from value.