A DIFC foundation is a legal entity established under the DIFC Foundations Law No. 3 of 2018. It provides a robust structure for holding assets, managing wealth, and planning succession. Unlike traditional corporate entities, a foundation does not have shareholders; instead, it operates with a charter and a council, making it a highly secure and flexible option for asset protection.
A DIFC foundation is a separate legal entity with its own rights and obligations.
Safeguard assets from external claims, creditors, or disputes..
Efficiently manage and distribute wealth according to specific goals.
Ensure seamless transfer of wealth and assets to future generations.
Maintain the privacy of the foundation’s activities and beneficiaries.
Benefit from zero corporate and personal income taxes in DIFC on qualifying income.
Assets under a DIFC Foundation continue as is if a Founder or any member of the Foundation passes away. Any changes to be made in such cases are made internally within the Foundation, without a court probate process.
A DIFC Foundation consists of four main parties:
There must be a minimum of one founder who creates the foundation to structure their assets. The founder can be an individual person or a corporate body.
Formed by the founder and must have a minimum of two members. The founder can also be a council member. The role of the council is to administer and operate the foundation in accordance with its charter and bylaws.
Can be an individual, a group of people, or an entity appointed by the founder. They benefit from the assets held by the foundation.
It ensures that the council follows the operational guidelines mentioned in charter and bylaws. This is a supervisory role which ensures the council acts in good faith and in the best interest of the beneficiaries.
In the case of a trust, the settlor loses control over the assets. The assets are managed exclusively by appointed trustees.
The settlor should generally not be a trustee; otherwise, it may be deemed that the settlor is still controlling the assets, potentially rendering the trust "illusory."
The trustee must act independently to avoid conflicts of interest. So if settlor is a trustee (Which is legally allowed), it becomes very sensitive in court of law in case of family wealth dispute, divorce and creditor claims etc.
In the case of a foundation, the founder retains control over the assets and can become a council member without facing legal issues in future.
It is a separate legal person. Assets belong to the foundation, not the founder.
So the governance is institutional. So this becomes strong succession planning.
DIFC foundations are highly effective in shielding assets from potential risks, disputes, or claims.
Simplify the process of transferring wealth to heirs or beneficiaries without legal complications.
The foundation’s charter and by-laws allow tailored governance structures.
Operating within DIFC enhances the reputation and trustworthiness of the foundation.
Leverage DIFC’s strategic location to manage assets across international markets.
Connect with Flying Colour Business Setup Services to identify your goals and ensure a foundation aligns with your needs.
Prepare the foundation charter and by-laws outlining its purpose, governance, and beneficiaries.
Submit the required documents and application to the DIFC Registrar of Foundations.
Assign a council to oversee the foundation’s operations.
Transfer assets into the foundation’s ownership.
Receive approval and license to operate as a DIFC foundation.
Investment in your financial future varies based on complexity and purpose
Initial registration fee paid to the DIFC Registrar of Foundations
Covers ongoing compliance requirements and yearly renewals
Professional fees for documentation and advisory services
Efficient Wealth Distribution DIFC foundations provide clarity and efficiency in distributing wealth among beneficiaries.
Control and Flexibility The founder retains control over the foundation’s assets and operations.
Enhanced Privacy Information about the foundation and its beneficiaries remains confidential.
Secure Legal Framework Operate within DIFC’s robust legal system under English common law principles.
Global Asset Management Use DIFC’s strategic position to manage and grow international assets.
For protecting and managing wealth
Ensure smooth succession planning
Hold investments and IP assets
Manage charitable activities
With over 20 years of experience, Flyingcolour® is your trusted consultancy
for DIFC foundation formation.
Here’s why you should choose us:
Our team provides tailored solutions based on your specific goals.
From drafting legal documents to post-registration compliance, we handle it all.
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The process typically takes 2-4 weeks, depending on the complexity of the foundation.
Yes, you can specify multiple beneficiaries and tailor the foundation’s distribution plan to your preferences.
No, DIFC foundations are open to individuals and entities from around the world.
Yes, DIFC foundations are ideal for holding and managing assets globally.
