Secure the applicable deed version
Bring together the foundation deed, supplementary deed, amendments and court decisions.
Mark the provisions on beneficiaries, distributions, bodies and the asset floor. Clearly label drafts and superseded versions.
Beneficiaries
Minimum asset level of a private foundation: distribution, resolution and records
How statutory minimum endowment, a deed-based asset floor and creditor protection affect distributions to private-foundation beneficiaries.
Your foundation law team
BRANDAUER Rechtsanwälte
Foundation law team, Salzburg and throughout Austria
Your matter is handled by a team combining corporate law, asset succession, real estate law and dispute resolution. We review the foundation declaration, board resolutions, information rights and liability issues and set out clear next steps. Mag. Bernhard Brandauer is responsible for the legal advice, supported by further specialised lawyers of the firm where the matter requires it.
21 August 2026, Mag. Bernhard Brandauer, Rechtsanwalt
The statutory minimum endowment of a private foundation is not the same as a minimum asset level protecting assets from distributions. The decisive question is whether the foundation deed sets an additional floor that distributions to beneficiaries may not reduce. Before a payment is made, the founder's intention, beneficiary status, authority, liquidity and creditor protection must be reviewed together.
A bank transfer does not answer these questions. A complete resolution should show why the foundation is making the distribution, which amount is permitted and how implementation will be recorded.
This article addresses the foundation-law review of a distribution. Tax treatment, including capital gains tax, is separate and must be reviewed for the specific transaction. The article on distributions and capital gains tax deals with that tax dimension separately.
Distinguishing statutory endowment from an asset floor
Distinguishing statutory endowment from an asset floor
Section 4 of the Austrian Private Foundations Act (PSG) requires assets worth at least EUR 70,000 to be dedicated to a private foundation. This statutory formation requirement must be distinguished from a later distribution. It does not, by itself, answer whether a payment may reduce the foundation's assets below EUR 70,000.
Section 9(2) no. 11 PSG allows the foundation deed to set a minimum asset level that distributions to beneficiaries may not diminish. This is an additional deed-based rule. Whether it exists can only be established from the applicable version of the foundation deed, not from a general assumption about private foundations.
Where several instruments exist, amendments, a supplementary deed and relevant court decisions must be brought together in the correct version. The portal article on interpreting different deed versions explains why an old draft cannot safely support a payment decision. The topic page on founder rights, amendment and revocation addresses the founder's personal reservations separately.
The key distinction
Which limit applies before a distribution?
The three levels should be addressed separately in the resolution.
| Level | What it concerns | What should be evidenced |
|---|---|---|
| Formation requirement Section 4 PSG: EUR 70,000 dedicated minimum endowment | Requirement for formation, not automatically a distribution floor | Dedication, asset position and current asset overview |
| Foundation deed Section 9(2) no. 11 PSG: optional minimum asset level | Distributions may not reduce the specified level | Effective deed version and exact clause |
| Creditor protection Section 17(2) PSG: protection of foundation creditors | A distribution is permitted only if creditor claims are not diminished | Due dates, liquidity, liabilities and payment date |
Review beneficiary status separately from entitlement
Review beneficiary status separately from entitlement
Section 5 PSG generally links beneficiary status to designation in the foundation deed. If no beneficiary is designated, a body appointed for that purpose, or otherwise the foundation board, may determine the beneficiary. This status question is not automatically a decision on a particular payment.
Even an identified beneficiary does not receive every requested amount at every point in time without further review. The deed, purpose of the foundation, applicable distribution criteria, any agreed asset floor and the foundation's financial position all matter.
A reliable file therefore records separately: who is a beneficiary; which basis permits a distribution; which body decides; and which facts justify the amount and timing. This also helps the board respond if information is later requested under section 30 PSG or the decision is challenged.
The resolution and payment must match
The resolution and payment must match
The foundation board manages and represents the private foundation and must comply with the foundation deed under section 17(1) PSG. A resolution should therefore identify the applicable deed version, beneficiary status, purpose, amount, payment date and calculation of the remaining assets.
It is not enough to state that a payment is approved. The resolution should show why the requirements are satisfied and how the remaining asset level was calculated. With fluctuating securities or real estate, the valuation date, encumbrances and realistically available funds deserve particular care.
The bank payment must then correspond to the resolution. If the amount, recipient account or payment date changes, the board should clarify whether a new resolution or supplementary approval is required. The article on foundation board duties and liability provides the wider context for this documentation.
Practical process
From the deed to a documented distribution
The sequence prevents a prepared transfer from dictating an unresolved legal review.
- 01Step 101Step 1
- 02Step 202Step 2
Check status and authority
Confirm beneficiary status, deciding body, majority and possible conflicts.
An expectation of payment replaces neither beneficiary status nor the competent distribution resolution.
- 03Step 303Step 3
Calculate the remaining assets
Compare the deed-based floor and creditor protection with the current position.
Consider cash, liabilities, due dates, encumbrances and realistic availability of the assets.
- 04Step 404Step 4
Adopt a reasoned resolution
Record basis, amount, purpose, date and remaining asset level.
The resolution should make later implementation and any information request under section 30 PSG understandable.
- 05Step 505Step 5
Record payment and follow-up
File transfer confirmation, booking and any deviation with the resolution.
A departure from the resolution should not be dealt with silently. Review its consequences before payment.
Documents that should be assembled before payment
Documents that should be assembled before payment
A reliable decision needs more than a bank balance. The file should contain the current foundation deed and effective amendments, the register position, the designation or determination of the beneficiary, relevant earlier resolutions and the calculation of the remaining assets.
A distribution in kind or a payment connected with real estate may also require valuation material, contracts, encumbrance records and proof of delivery. For recurring distributions, check whether the deed sets a period, cap or adjustment rule.
Under section 30 PSG, beneficiaries may request information about fulfilment of the foundation purpose and inspect certain documents. A structured file is therefore useful beyond the payment itself: it prevents the foundation from having to reconstruct its reasons later from different versions and incomplete recollections.
Important: The statutory EUR 70,000 under section 4 PSG and an additional minimum asset level under section 9(2) no. 11 PSG are separate reviews. Creditor protection under section 17(2) PSG is an independent requirement as well.
Initial orientation
Is the file ready for a distribution resolution?
Three questions help identify the main open points before payment.
Already know you want to get in touch? Go straight to the enquiry form.
Is the current foundation deed, including effective amendments, complete?
All paths at a glance
Overview of all answers.
The resolution can now be prepared.
Record the basis, amount, purpose, date, authority and remaining asset level in a complete resolution. Ensure that the later bank payment matches it exactly.
The applicable deed version must be clarified first.
Order the foundation deed, supplementary deed, amendments and relevant court decisions. Without the effective version, a minimum asset level under section 9(2) no. 11 PSG cannot be assessed reliably.
Status and authority are still open.
Separate beneficiary status from the distribution itself. Check designation or determination under section 5 PSG and identify the body authorised to decide under the foundation deed.
The asset and liquidity calculation must be completed.
Calculate the remaining assets and also review creditor claims under section 17(2) PSG. A high book value does not replace a review of availability, encumbrances and due dates.
Frequently asked questions
Minimum asset level and distributions from a private foundation
May a private foundation have less than EUR 70,000 after a distribution? +
Section 4 PSG requires a dedicated minimum endowment of EUR 70,000. That provision alone does not answer whether a particular distribution may reduce the assets below that amount. The foundation deed, any asset floor under section 9(2) no. 11 PSG and creditor protection under section 17(2) PSG must also be reviewed.
Is a beneficiary automatically entitled to a payment? +
No. Beneficiary status under section 5 PSG and a specific distribution decision are separate questions. The payment must be supported by the deed and purpose, and authority, asset level and creditor protection must be observed.
Which information should a distribution resolution contain? +
It should identify the applicable deed version, beneficiary status, authority, purpose, amount, payment date and remaining asset level. Depending on the assets, valuations, encumbrances, liquidity records and payment evidence should also be filed.
Can a beneficiary request the distribution documents? +
Section 30 PSG provides information and inspection rights concerning fulfilment of the foundation purpose and certain documents, including accounts, reports, books and foundation deeds. The scope in an individual case depends on the request and statutory requirements.
Continue on the portal
Related in-depth topics and matching tools.
Beneficiary status and determination
Why status, determination and the specific distribution must be reviewed separately.
Beneficiaries and information rights
Information rights and how foundation documents are assessed.
Foundation board and liability
Care duties, conflicts and responsibility for body decisions.
Topics
Private foundationMinimum asset levelDistributionBeneficiariesFoundation deedFoundation boardCreditor protectionResolution
Conflict in the foundation, a blocked board, information denied?
In foundation law, structure, deadlines and evidence decide. Call us directly or write to us, callback within one business day.
Direct line to the firm.
Address
BRANDAUER Rechtsanwälte GmbH Giselakai 51 5020 Salzburg
Phone
+43 662 6280000