How to Set Up a Charitable Foundation in Switzerland

The Swiss legal framework set out in the Swiss Civil Code (SCC) is well-tested, rarely subject to fundamental change, and provides a reliable long-term basis for founders and their advisors.

Swiss foundations are recognised by banks, regulators, and partner organisations worldwide. The Swiss foundation is well understood by international counterparties, which simplifies due diligence and facilitates grant partnerships across jurisdictions.

Switzerland is home to nearly 14,000 charitable foundations, with the largest concentrations in Zurich, Geneva, and Basel. These regions and cities host major international NGOs, UN agencies, and philanthropic networks, giving Swiss-domiciled foundations direct access to a uniquely dense philanthropic ecosystem.

Founders benefit from Switzerland's concentration of legal, tax, fiduciary and financial specialists. KENDRIS combines these disciplines in-house, which offers the chance to receive advice on foundation setup, structuring, governance, and ongoing administration from a single team.

The purpose of a foundation is freely determinable, provided it does not violate the law or s public morals. When establishing a charitable foundation, the wording must be clear enough to guide the foundation's activities, yet broad enough to remain relevant over the long term.

Any later change to the purpose requires the approval of the Swiss Federal Supervisory Authority for Foundations (FSAF) and, where tax-exempt status is  to be confirmed, also the competent cantonal tax authority.
 

All legal documents for establishing a foundation must be drafted carefully, including the foundation charter.

The charter determines 

• the foundation's name 
• the foundation's purpose 
• the initial capital dedicated to it 
• the organisational structure 
• and the administration. 

The foundation may be established during the founder's lifetime by a public deed at the notary. Alternatively, it may be established after death through a last will or inheritance contract.
 

The foundation board is the supreme governing body and is responsible for managing and administrating the foundation. Swiss law requires at least one board member with Swiss domicile. In practice, boards of three to five members are most common. 

KENDRIS provides experienced independent foundation board members where needed — whether to ensure independence and compliance or to complement the expertise on the board. We also offer comprehensive services for the establishment and ongoing administration of foundations.

Once the foundation charter is notarized by public deed, the foundation begins to exist when registered with the Commercial Register. The operational setup includes opening a bank account in Switzerland in the foundation's name and transferring the initial capital. 

Tax exemption is not granted automatically. The foundation must apply to the competent cantonal tax authority, which assesses whether the purpose and charter meet the legal requirements. 

An advance tax ruling is usually requested to confirm tax-exempt status before the foundation is formally established. This is particularly advisable where the charitable purpose is complex or where significant assets are to be contributed.

An exempted foundation is not liable for gift, inheritance, profit and capital taxes.

The foundation's annual accounts are subject to an external financial audit each year. An activity report together with the financial statements must be prepared and filed with the foundation supervisory authority. The tax authority of the canton in which the foundation is registered may request information and documentation to verify continued eligibility for tax exemption.

The financial audit and supervisory oversight ensure that the foundation's assets are used in accordance with its stated purpose, that all legal requirements are met, and that the foundation is properly administered. The foundation board is responsible for managing the foundation's assets and fulfilling its charitable purpose, including the selection and monitoring of grant recipients or the operation of charitable projects.

Foundations with international activities or cross-border funding arrangements must additionally comply with Swiss anti-money laundering requirements and, where relevant, CRS and FATCA reporting obligations.

Changes to the foundation's purpose or charter require approval by the supervisory authority. Upon the foundation’s dissolution, remaining assets must be transferred to another tax-exempt entity with an equivalent charitable purpose and must not  revert to the founder.

Swiss charitable foundations play a vital role in supporting philanthropy, innovation, and long-term societal impact. However, many foundations continue to face operational and governance challenges stemming from fragmented service models, manual accounting processes, and limited transparency across investment and administrative activities. In practice, foundation boards often rely on multiple external providers for accounting, asset management, legal, and reporting services, resulting in inefficiencies, inconsistent data flows, and reduced oversight capabilities.

The absence of consolidated investment reporting and integrated governance frameworks can further limit informed decision-making and weaken transparency regarding performance, costs, and alignment with the foundation’s purpose. In addition, manual and decentralized processes increase operational risk, reduce scalability, and may create conflicts between stakeholder interests and the purpose of the foundation. At the same time, many foundation boards face increasing regulatory complexity and heightened expectations regarding fiduciary responsibility, transparency, and strategic oversight.

As regulatory expectations and governance standards continue to evolve in Switzerland, foundations increasingly require operating models that combine transparency, efficiency, and independent oversight. 

In this context, KENDRIS is uniquely positioned to support charitable foundations through integrated foundation management, consolidated financial reporting, accounting services and automation, governance advisory, and coordinated oversight across administration, accounting, and investment activities. 

In addition to operational support, KENDRIS can actively strengthen foundation boards by providing experienced professionals for board membership, supporting governance frameworks, and enhancing decision-making processes with independent and transparent financial reporting. By leveraging technology-enabled processes and independent expertise, KENDRIS helps foundations improve operational efficiency, strengthen governance structures, and ensure that strategic and investment decisions remain fully aligned with the foundation’s charitable purpose.