More and more wealthy families in Belgium are moving their assets to a 'private foundation' so future generations do not have to pay inheritance tax on them, according to research by De Tijd and L'Echo.
Of the 2,105 private foundations in Belgium, 517 (just under 25%) are used for inheritance planning, the newspapers found. These include entrepreneurs such as various branches of the Schaltin family of Zuidnederlandse Uitgeverij (Standaard Boekhandel) or descendants of the bus-building family Van Hool and the Solvay chemical family.
It also includes branches of the De Merode family, fashion designer Dries Van Noten, festival organiser Herman Schueremans and the family of jazz legend Toots Thielemans.
It is unclear how many assets are held in these foundations. Of the 517, only 20 publish consultable annual accounts. One family appears to have assets of over €29 million in its foundation, another has €10.7 million, mostly in the form of investments.
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Once someone has placed their fortune in a private foundation, the directors of that foundation can continue to manage and invest it, even after the founder dies. Belgian law does stipulate that private foundations must pursue a "non-profit purpose," but the law is so vague that there is much room for interpretation.
Foundations also have to pay an annual patrimony tax, but this does not outweigh the inheritance tax saved.
