The question of substance

Read the PDF edition (1 page)

A foundation with its seat in Zug and a board whose majority lived abroad raised the question where the foundation was actually managed. Swiss tax law taxes a legal entity with its seat or its place of effective management in Switzerland. Foreign tax authorities can claim that a foundation with its seat in Zug is effectively managed in their country and tax it there. The founders who lived in other countries could also face questions about their personal tax position if the foundation was controlled by them.

The crypto foundations have responded in different ways. While the larger ones have built teams in Zug and hold their board meetings there, others have moved part of their activities to other jurisdictions and kept a smaller presence in the canton. The question of substance has become more important since the international tax reforms of the Organisation for Economic Co-operation and Development and the introduction of the global minimum tax, although most crypto foundations fall below the revenue threshold of 750 million euros that applies to the minimum tax.¹ Part B examines those reforms for Zug in general.

Notes

Federal Department of Finance, "Umsetzung der OECD-Mindeststeuer in der Schweiz", efd.admin.ch: minimum tax introduced on 1 January 2024 (national supplementary tax, international supplementary tax from 1 January 2025), applying only to international groups with annual worldwide turnover of at least EUR 750 million. ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of September 2025.

English

Contact

Dr Alexander Ressos, TEP

Rechtsanwalt/Attorney-at-Law

I am a Swiss attorney-at-law and also admitted as a solicitor in Hong Kong and in England & Wales, with almost 25 years of experience.

Together with my multilingual team, including Chinese, Japanese, Korean, Russian, Ukrainian and French native speakers, I advise companies and their owners from around the world on the full range of banking, corporate, commercial and tax law matters in Switzerland, including international tax planning, fiduciary services, and legal family office services including immigration & relocation or real estate investments. My practice has a particular focus on clients from growth and frontier markets in Greater China, Central Asia and the Caucasus, the rest of Asia, the Middle East, Africa and Latin America, and I equally advise clients from Europe and North America. Through an affiliated Swiss trust company, we also take care of the incorporation and ongoing administration of their companies and other structures, including accounting, tax returns and corporate secretarial services, and I serve as a professional director where required. With the support of a network of first-class cooperation partners, I also implement solutions worldwide.

My approach is to act as a trusted advisor who works directly with decision-makers, on an equal footing: I start from what you want to achieve and shape every structure, contract and tax decision around your commercial goals and how it improves your after-tax return. As “lawyers who make it happen”, my team and I stay involved until your company is set up, your structure is in place and your transaction has closed, and we remain available for any follow-on work that may be required. You benefit from bespoke solutions and personal attention, and sound, friendly and practical advice. We are not the lowest-cost provider in the market, nor do we intend to be; our aim is to deliver well-founded, proper solutions and excellent value for money.

Get in touch →

The question of substance

Notes

Setting up or expanding in Switzerland?