Written by Almer Aditya Rahimsyah on 05/08/2024
The author’s views are entirely their own and may not always reflect the views of Putranto Alliance.
A foundation is a non-profit organization dedicated to social, educational, or humanitarian causes. By creating a foundation, individuals and organizations can channel their resources and efforts toward meaningful initiatives that advance the welfare of humanity. A foundation provides a structured and sustainable platform to achieve long-term philanthropic goals. This article delves into the intricacies of foundation establishment, highlighting its importance, benefits, and the process involved, ensuring that your vision for a better world can be realized effectively.
A foundation is a non-profit organization established for social or educational purposes. Foundation assets can be acquired through money, goods, and other items. These assets are prohibited from being transferred or distributed directly or indirectly, either in the form of salaries, wages, and honorariums or other forms that can be valued in money to the trustees, management, and supervisors.
The best time of foundation establishment is when there is a clear vision and mission for social or educational purposes, and when there are sufficient resources to support the foundation’s activities. Additionally, it is crucial to ensure that all legal requirements and regulations are met before proceeding with the establishment.
When considering foundation establishment, several compelling advantages come to the forefront:
Asset Segregation
The foundation's assets and its founder are separated once the foundation is established.
Legal Protection and Donor Trust
Registering and legalizing a foundation as a separate legal entity provides the added benefit of legal protection, which increases donor confidence, foundations can also invest in businesses, capped at 25% of total assets.
Tax Benefits for Contributions
Grants, assistance, or donations given to foundations are exempted as Income Tax objects, provided there is no relationship with business, work, ownership, or control between the parties concerned.
Before the process of foundation establishment starts, founders need to consider several aspects. Although it may seem simple, foundation establishment has its complexities. Here are some of the points to consider:
Foundation's Name
The foundation's name must be unique, not conflict with public order or decency, and start with "Foundation."
Foundation's Purpose
The foundation's purpose should be social, religious, and humanitarian engagement.
Notarial Deed
The establishment of a foundation is formed by a notarial deed.
Initial Wealth
Indonesian foundations require a minimum of Rp10.000.000,00 for initial wealth, while foreign foundations require a minimum of Rp100.000.000,00 initial wealth, supported by the founder's asset legitimacy declaration.
Founder's Identity
Passport for foreign individuals, legal entity documentation for entities.
Board Members
Foreign-founded foundations need an Indonesian board member (chairman, secretary, or treasurer). Board members require KITAS and Indonesia residency.
Establishing a foundation involves numerous complexities and legal requirements. Our team of experts specializes in Indonesian regulations and can provide the following services:
Expert Guidance: We offer accurate and up-to-date information on foundation establishment requirements and procedures, ensuring that your foundation is compliant with current regulations.
Tax Planning and Optimization: Our tax consultants work to minimize estate tax liabilities and optimize asset distribution, preserving more of your wealth for your beneficiaries.
Business Succession Planning: For business owners, we provide detailed planning for business continuity, including succession planning and leadership transitions.
Dispute Resolution and Conflict Mitigation: In the event of disputes or challenges, our team is equipped to provide legal representation and conflict resolution services.
A response to the inquiry will be sent to the provided email within 2 working days.
putranto@putranto-alliance.com
Jl. Denpasar Raya Blok C4/24
Kompleks Menteri, Kuningan
Jakarta Selatan, 12950, Indonesia
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