Foundation Setup

Swiss Foundation Types and Structure: A Practical Guide

Q: Is a holding foundation a separate type under Swiss law?

No. A holding foundation (Holdingstiftung) is not a statutory category in the Swiss Civil Code; it is a colloquial label for an ordinary foundation used to hold equity stakes or other assets within a group structure. The same Civil Code rules that apply to any ordinary foundation, supervision, auditor, purpose requirements, apply to it.

Swiss law recognises four main types of foundation: ordinary foundations (which include charitable, or public-utility, foundations), family foundations, ecclesiastical foundations, and employee-benefit and pension foundations. They differ in purpose and oversight, but they share one structure. Each is an autonomous pool of assets, irrevocably dedicated to a defined purpose, governed by a foundation board and, for most types, overseen by a supervisory authority. A foundation has no owners and no shareholders. Under the Swiss Civil Code, Article 80, a foundation is created by dedicating assets to a particular purpose.

This guide explains each type, the structure they have in common, how each one is established, and how to decide which fits your goal. For the wider picture, see our complete guide to Swiss foundations.

Key takeaways

There are four main types of foundation under the Swiss Civil Code (ZGB Articles 80–89c).

A foundation has no owners or members, only beneficiaries.

Every foundation shares the same structure: founder, an irrevocable purpose, a foundation board (Stiftungsrat), an auditor, and a supervisory authority.

Family and ecclesiastical foundations are exempt from state supervision and from the audit duty (Article 87).

A foundation acquires legal personality on entry in the commercial register; CHF 50,000 is the practical capital floor expected by supervisory authorities.

What is a Swiss foundation?

A Swiss foundation is an independent legal entity formed by dedicating assets to a defined purpose. Unlike a company, it has no shareholders; unlike an association, it has no members. The assets serve the purpose, and named or described beneficiaries may receive support from them, but nobody owns the foundation. This is the defining feature set out in the Swiss Civil Code (ZGB), Article 80.

Because there are no owners, control rests with the foundation’s governing body rather than with investors. That single point shapes everything that follows. The full legal basis is set out in our guide to Swiss foundation law (Civil Code Articles 80–89).

The four main types of Swiss foundations

The Civil Code regulates all foundations under Articles 80–89c, then carves out special rules for particular categories. The table below summarises the main types and how their oversight differs.

Type	Governing article	Purpose and beneficiaries	State supervision	Auditor
Ordinary / charitable (public-utility)	ZGB Art. 80–84	Any lawful purpose; charitable foundations serve education, science, culture, health or social welfare	Yes, ESA (federal) or cantonal	Yes (small-foundation exemption possible)
Family foundation (Familienstiftung)	ZGB Art. 335; Art. 87	Costs of education, establishment and support of family members, a narrow remit	No	No
Ecclesiastical foundation	ZGB Art. 87	A religious purpose, linked to a religious community	No	No
Employee-benefit / pension foundation	ZGB Art. 89a; BVG	Protects employees and dependants against old age, disability and death	Yes, cantonal BVG authority / OPSC	Yes

Ordinary and charitable (public-utility) foundations

An ordinary, or “classic”, foundation is any foundation that does not fall into a special statutory category. It is governed by the general rules in the Swiss Civil Code, Articles 80–84. The best-known sub-set is the charitable, or public-utility, foundation: one whose purpose serves the public interest, education, science, culture, health, the environment or social welfare. A charitable foundation that is dedicated exclusively and irrevocably to public-benefit purposes may qualify for tax exemption, subject to cantonal and federal assessment.

Ordinary foundations are supervised by a supervisory authority and must, as a rule, appoint an auditor. To set one up for philanthropy, see our guide to creating a charitable foundation.

Family foundations (Familienstiftung)

A Familienstiftung (family foundation) is a foundation whose beneficiaries are members of one or more families. Under the Swiss Civil Code, Article 335, a family foundation may only be established to cover the costs of education, establishment (helping a family member start out in life) and support of relatives, or for similar purposes. This is a deliberately narrow remit: foundations designed simply to maintain relatives in comfort, so-called maintenance foundations, are not permitted under Swiss law.

A practical consequence is that family foundations are generally not tax-exempt, unlike charitable foundations. Their advantage lies elsewhere, continuity, governance and a degree of privacy. They are exempt from state supervision and from the duty to appoint an auditor under Article 87. For the full picture, see our guide to the Swiss family foundation (Familienstiftung).

Ecclesiastical foundations

An ecclesiastical foundation is established for a religious purpose and maintains an organic link to a religious community that can exercise its own internal oversight. Like family foundations, these are exempt from state supervision and from the statutory audit requirement under the Swiss Civil Code, Article 87.

Employee-benefit and pension foundations

Employee-benefit and pension foundations (Personalvorsorgestiftungen) protect employees and their dependants against risks such as old age, disability and death. They form part of Switzerland’s second pillar of occupational provision and are governed by the Swiss Civil Code, Article 89a, together with the Federal Act on Occupational Old Age, Survivors’ and Invalidity Pension Provision (BVG). They are supervised by the cantonal BVG supervisory authorities, with the Occupational Pension Supervisory Commission (OPSC) at federal level, and must appoint an auditor.

A note on terminology: a “corporate foundation” is not a separate legal category. It is usually an ordinary foundation set up by a company for a public or business purpose, or an employee-benefit foundation where it serves staff provision. Similarly, a holding foundation (Holdingstiftung) is not a statutory category but a colloquial term for an ordinary foundation used to hold equity stakes or other assets within a group structure, it is still subject to the same Civil Code rules. We mention both labels because they are often used loosely.

The common structure of every Swiss foundation

Whatever the type, every Swiss foundation is built from the same five elements. Understanding them is the quickest way to understand how a foundation works.

The founder and the dedicated assets

The founder, a person or a company, dedicates the initial assets. This can be done during the founder’s lifetime by a public deed, or on death by a will or inheritance contract, as set out in the Swiss Civil Code, Article 81. Once dedicated, the assets belong to the foundation, not the founder.

The purpose, and why it is irrevocable

The purpose is fixed in the foundation deed and is, in principle, irrevocable: the founder cannot later reclaim the assets or freely rewrite the aim. The purpose may be amended only in narrow circumstances defined by law. This permanence is what gives a foundation its stability across generations, and why drafting the deed carefully matters so much.

The foundation board (Stiftungsrat)

The foundation board (Stiftungsrat) is the supreme governing body. It administers the assets and is responsible for fulfilling the purpose. The foundation’s organisation, how the board is composed and how it acts, is laid down in the deed, as required by the Swiss Civil Code, Article 83. In practice, supervisory authorities expect at least three board members, though the Code itself sets no fixed number. The board’s duties are covered in our guide to foundation board duties and governance.

The auditor

Ordinary foundations must appoint an external auditor under the Swiss Civil Code, Article 83b. A small foundation may be released from this duty where its balance-sheet total stays below CHF 200,000 for two successive years and it does not appeal to the public for donations. Family and ecclesiastical foundations are exempt from the audit duty altogether (Article 87).

The supervisory authority (ESA or cantonal)

Most foundations are placed under a supervisory authority that ensures the assets are used for the stated purpose, under the Swiss Civil Code, Article 84. Foundations with a national or international reach fall under the Federal Supervisory Authority for Foundations (ESA / Eidgenössische Stiftungsaufsicht); those active within a single canton fall under the relevant cantonal authority. Family and ecclesiastical foundations are exempt. See our guide to the foundation supervisory authority (ESA).

How each type is established

The core route to establishing a Swiss foundation follows the same sequence, with the main differences arising at the supervision stage.

Define the purpose and beneficiaries. Decide whether the aim is public-utility, family, religious or employee provision, this determines the type.
Draft and execute the foundation deed. The deed must be executed as a public deed (or set out in a testamentary disposition) and must state the purpose, the assets, the organisation and the registered office.
Contribute the assets. Transfer the dedicated assets. There is no statutory minimum in the Civil Code, but in practice supervisory authorities expect around CHF 50,000 so the foundation can pursue its purpose and meet administrative costs.
Register in the commercial register. The foundation acquires legal personality only on entry in the commercial register.
Obtain supervisory recognition where required. Ordinary and charitable foundations are taken under supervision by the ESA or a cantonal authority; pension foundations register with the BVG authority. Family and ecclesiastical foundations are not subject to state supervision.

The detail varies by case. For figures and timing, see our guides to the capital requirements and set-up costs and how long it takes to set up a Swiss foundation. Non-residents should read setting up a Swiss foundation as a foreigner.

Which type of Swiss foundation should you choose?

The right type follows from your goal.

Philanthropy or public benefit, a charitable (public-utility) foundation, which may qualify for tax exemption.
Family continuity, a family foundation, bearing in mind the narrow statutory purposes and that it is generally not tax-exempt.
Staff provision, an employee-benefit or pension foundation under the BVG framework.
A lower-cost philanthropic start, a sub-foundation (also called a sub-fund) under a Swiss umbrella foundation. An umbrella foundation is an existing charitable foundation that allows donors to establish a named sub-foundation within its legal structure, avoiding the cost and administration of setting up an independent entity.

If circumstances change, a foundation can also be wound up, see dissolving a Swiss foundation. Because the choice carries lasting legal and tax consequences, it is worth confirming before you draft the deed. To weigh the options for your situation, speak to a Swiss foundation lawyer.

Frequently asked questions

What are the main types of foundations in Switzerland? Swiss law recognises four main types: ordinary foundations (including charitable, or public-utility, foundations), family foundations (Familienstiftung), ecclesiastical foundations, and employee-benefit or pension foundations. They are all governed by the Swiss Civil Code, Articles 80–89c, with special rules for the latter categories.

What is the structure of a Swiss foundation? Every Swiss foundation has the same five elements: a founder who dedicates the assets, an irrevocable purpose, a foundation board (Stiftungsrat) that governs it, an auditor (for most types), and a supervisory authority. It acquires legal personality on entry in the commercial register.

Does a Swiss foundation have owners or shareholders? No. A foundation has neither owners nor shareholders nor members. It is an autonomous pool of assets dedicated to a purpose, as defined in the Swiss Civil Code, Article 80. Beneficiaries may receive support, but they do not own the foundation.

Can a family foundation be purely private in Switzerland? Only within limits. Under the Swiss Civil Code, Article 335, a family foundation may serve the education, establishment and support of family members, but pure “maintenance” foundations that simply provide for relatives’ upkeep are not permitted.

How is each type of Swiss foundation established? By defining the purpose, executing a foundation deed as a public deed, contributing the assets, and registering in the commercial register. Ordinary and charitable foundations are then taken under ESA or cantonal supervision; pension foundations register with the BVG authority; family and ecclesiastical foundations are not state-supervised.

Is a holding foundation a separate type under Swiss law? No. A holding foundation (Holdingstiftung) is not a statutory category in the Swiss Civil Code; it is a colloquial label for an ordinary foundation used to hold equity stakes or other assets within a group structure. The same Civil Code rules that apply to any ordinary foundation, supervision, auditor, purpose requirements, apply to it.

What is an umbrella foundation, and how does a sub-foundation work? An umbrella foundation is an existing charitable foundation that allows donors to create a named sub-foundation (or sub-fund) within its legal structure. The sub-foundation benefits from the umbrella’s tax-exempt status and administrative infrastructure, avoiding the cost and time of establishing an independent entity. The umbrella remains the single legal person; the sub-foundation is a named fund within it.

Which Swiss foundation types are exempt from state supervision? Family foundations and ecclesiastical foundations are exempt from state supervision and from the statutory audit requirement under the Swiss Civil Code, Article 87. All other types, ordinary, charitable, employee-benefit and pension foundations, are placed under either the federal supervisory authority (ESA) or the relevant cantonal authority.

Can a charitable foundation in Switzerland qualify for tax exemption? Yes, if it is dedicated exclusively and irrevocably to a public-benefit purpose, such as education, science, culture, health, the environment or social welfare, and that purpose is pursued in a non-profit manner. Tax exemption is granted at both cantonal and federal level, but each authority assesses the application independently, and the outcome depends on the specific purpose and structure.

What is the minimum capital required to set up a Swiss foundation? The Swiss Civil Code sets no statutory minimum. In practice, however, supervisory authorities expect approximately CHF 50,000 so the foundation can meaningfully pursue its purpose and meet its ongoing administrative costs. For pension foundations the BVG framework imposes its own capital and solvency rules.

Can a non-resident or foreigner establish a Swiss foundation? Yes. Swiss law imposes no nationality or residency requirement on the founder. A non-resident may establish any type of Swiss foundation, provided the deed is executed as a public deed in Switzerland, the assets are duly transferred and the foundation is registered in the commercial register. At least some board members must be resident in Switzerland in practice, to ensure the foundation can be reached by supervisory authorities.

What happens to a Swiss foundation’s assets if it is dissolved? On dissolution, the foundation’s assets cannot revert to the founder, that would contradict the irrevocable dedication that defines a foundation. Instead, the assets are transferred to another entity with a similar purpose, as determined by the supervisory authority or the courts. The precise outcome depends on the terms of the foundation deed and the applicable cantonal rules.

How does a Swiss foundation differ from a Swiss association? Both are non-profit legal entities under the Civil Code, but they are structured differently. An association (Verein) has members who meet, vote and govern the entity collectively. A foundation has no members; it is an autonomous pool of assets governed by a board, with no ultimate owner. Foundations are generally more stable vehicles for long-term asset dedication, while associations suit membership organisations with ongoing participant involvement.

Can the purpose of a Swiss foundation be changed after it is established? Only in narrow, legally defined circumstances. The purpose is in principle irrevocable once the foundation deed is executed. The supervisory authority may approve a purpose amendment if the original purpose has become impossible to fulfil, if the purpose has been fulfilled in full, or if circumstances have changed so fundamentally that the original purpose would no longer serve the interests the founder intended. The founder cannot unilaterally amend the purpose after establishment.

This article is general information and not a substitute for formal legal advice. Foundation structuring carries legal and tax consequences specific to your circumstances; obtain advice before acting.

Sources

Swiss Civil Code (ZGB / CC), Articles 80–89c, Federal law portal Fedlex (SR 210): https://www.fedlex.admin.ch/eli/cc/24/233_245_233/en
Swiss Civil Code, Article 335 (family foundations), Fedlex (SR 210): https://www.fedlex.admin.ch/eli/cc/24/233_245_233/en
CMS Law, “Foundations under Swiss law: an overview”: https://cms.law/en/che/legal-updates/foundations-under-swiss-law-an-overview
ICNL, “The Swiss Legal Framework on Foundations and Its Principles About Transparency”: https://www.icnl.org/resources/research/ijnl/the-swiss-legal-framework-on-foundations-and-its-principles-about-transparency-pdf
Onlinekommentar, commentary on Article 87 CC (family and ecclesiastical foundations): https://onlinekommentar.ch/en/kommentare/zgb87
Federal Supervisory Authority for Foundations (ESA): https://www.edi.admin.ch/edi/en/home/fachstellen/eidgenoessische-stiftungsaufsicht.html
Occupational Pension Supervisory Commission (OPSC / OAK BV): https://www.oak-bv.admin.ch/en
Swiss Foundation Code 2021, SwissFoundations (governance best practice).