Foreign trust or foundation: map roles and cash flows first

A founder established a foreign private foundation ten years ago. He believes the assets are no longer his, the children expect future distributions, the foreign board relies on the constitutional documents, and the bank still treats the founder as a key person. Each statement may relate to a different role and a different system of rules.

The first question is not whether this is a ‘good foundation’. Identify who contributed capital, who appoints and removes the board, who may recommend or block a decision, who receives information, who has a right to a distribution and who actually manages the assets.

Map every flow: a company pays a dividend to the foundation, the foundation lends to a family member, funds a child’s education or distributes capital. For every arrow, record payer, recipient, legal basis, bank, country and supporting document.

A person who receives money does not necessarily control the structure. A person who can appoint the board does not necessarily own an asset. Combining these roles makes it impossible to formulate a precise question for either the Dutch tax adviser or foreign counsel.

The Dutch Tax Administration uses the term afgezonderd particulier vermogen (APV), or segregated private assets, for certain trusts and private or family foundations. In some circumstances, assets and income may be attributed for Dutch tax purposes to the contributor or to that person’s heirs.

The word trust or foundation does not by itself prove APV treatment or answer every tax question. Purpose, documents, actual roles, specific distribution rights, contribution history and connected companies all matter. Foreign counsel separately confirms the structure under its governing law.

A founder’s move to the Netherlands, the contributor’s death, a board change, a distribution to a child in another country and an asset sale are not one international event. Each event requires a fresh map of countries, people or companies, cash flows and professional conclusions.

The review therefore ends with a matrix: event, country, question, missing fact, professional and review date. It exposes inconsistencies before a payment or document change.

After the inventory, the family has a role-and-cash-flow diagram, a document list and separate questions for the Dutch tax adviser and foreign counsel. If the conclusions conflict with family expectations, the decision is revisited before a single instrument is rewritten.

Service 09 is relevant where a structure already exists or is under serious consideration. A simpler Dutch giving or family-governance route may be sufficient in other cases.