Trust and Foundation

There are many similarities between a Trust and a Foundation. Both may be set up during one’s lifetime (inter-vivos) or on death (testamentary) and can allow for the organisation of your estate/assets during your life-time. However, the main difference between a Trust and a Foundation is that a Trust is not a legal entity.

A Foundation is a legal entity in its own right and can therefore own assets directly. It can be charitable or non-charitable, or both. It possesses some hybrid characteristics of a trust and a company. It is governed by the Foundations Act 2012

A trust is an “agreement” between the Settlor and the Trustee in which the ownership of the assets is transferred by the Settlor to the Trustee for the benefit of the beneficiaries named in the trust deed. There is therefore “split” ownership, legal ownership by the Trustees and the equitable interest held by the beneficiaries named in the Trust Deed.

If a Trust or Foundation has chosen Mauritius as its jurisdiction, it is required to be registered in Mauritius. A Trust Mauritius will be governed by the Trust Act 2001 whilst a Foundation by the Foundations Act 2012.

Discretionary Trusts

Charitable Trusts, meant solely for the benefits of charitable bodies
Non- charitable

Purpose Trusts, formed for specific, reasonable and certain purposes. Such trusts will normally have no beneficiaries
Both charitable and non-charitable

Foreign Trusts
Estate, succession planning and family office services
Estate and succession planning

Accumulation and Preservation of wealth
Accumulation and Preservation of wealth

Asset Protection
Asset Protection

Tax Planning
Tax Planning

Corporate Finance/Asset Financing
Corporate Finance/Asset Financing

Used as a Special Purpose Vehicle in off Balance Sheet Transaction
Used as a Special Purpose Vehicle in off Balance Sheet Transaction
Full confidentiality of trustees’ identity, deliberations and beneficiaries
Foundations in Mauritius may apply for a Global Business Company Licence and become tax resident. It can benefit from the 80% partial tax exemption regime on specified income streams and has access to wide network of Double Tax Agreements

Charitable trusts are tax exempt
Charitable Foundations are automatically tax exempted;

Freedom to choose proper law of trust (i.e. may not be Mauritius Trust)
Foundations currently set up in other jurisdictions can re-domicile to Mauritius or vice versa

Members of the Foundation council are not liable to the Beneficiaries


LMS has experience in the formation of Trust and Foundations and adapts to each client’s personal requirements. Continuous support to maintain the Trust and Foundation is provided by our Team.

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