What Is a Family Office?
A Family Office is a private wealth management organisation serving one or several wealthy families, with regulatory and tax treatment depending on national law.
Also known as: Single Family Office (SFO), Multi-Family Office (MFO).
How Family Office works
A Family Office is usually set up once a family's assets justify dedicated staff for investment management, accounting, tax compliance, succession planning and administration, and the office may operate as a company, a department of a holding company or a contracted multi-family service provider. Regulatory status depends on clients and ownership: under the United States SEC rule, an office serving only family clients, owned and controlled by the family and not offering advice to the public is excluded from investment adviser registration. Tax treatment follows the entity's residence, place of effective management and economic substance, so outcomes vary by country.
Family Office vs Private Foundation
Unlike a private foundation, which is a legal entity holding assets for stated purposes or beneficiaries, a Family Office is an operating organisation which manages assets and services without itself defining ownership.
Example
Illustrative example: A family whose members live in Country A and Country B creates a company in Country A to employ an investment team. The company manages family holding entities, so where the team takes key decisions can influence where those entities are considered tax resident.
Common misconception
Myth: Setting up a family office abroad moves the family's wealth out of the home country's tax net.
Reality: A Family Office does not change the personal tax residence of family members, and decisions taken locally may give its entities a taxable presence where the family lives.
Frequently asked questions
What is the difference between a single family office and a multi-family office?
A single Family Office serves one family and is generally owned by the family, whereas a multi-family office is a commercial firm providing similar services to several unrelated families.
Does a family office need a licence?
A Family Office's licensing position depends on national law; in the United States, an office meeting the SEC family office rule is excluded from investment adviser registration, while other countries apply different tests.
Related terms
- Trust — Fiduciary wealth-structuring vehicle commonly established and overseen by family offices
- Holding Company — Common entity through which family offices hold investments
- Place of Effective Management (POEM) — Decides residence of entities managed by the office
- High Net Worth Individual (HNWI) — Typical client profile of a family office
Related guides
- Incorporation options for location-independent entrepreneurs — Entity choices relevant to family office structures
Sources
Last verified: 2026-10-08. This entry is general information, not tax or legal advice; rules vary by country and change over time.
