Located in Eastern Caribbean, British Virgin Island (BVI) offers multiple business opportunities to expats planning of setting up an offshore company in BVI. With stable political condition, developed infrastructure, and accommodating tax policies, BVI’s government encourages foreign business activities.
According to the Business Company Act, a company must have the following characteristics to be operational in BVI.
The best part about their tax policy is that there is NO tax.
Companies can operate in BVI, after issuing a minimum of 1 bearer or registered share. An offshore company must pay a licensing fee of $1,100, in order to issue bearer shares. No long procedures are in place to regulate the issuance of shares. The companies must maintain a register of shareholder at their registered office in BVI. Moreover, the bearer shares must be issued, after the approval of a custodian.
The details of corporate directors must be timely filed, within 28 days, in the Companies Registry or else the company will be subjected to heavy fines.
Time taken for the incorporation process
The incorporation process can be completed with 24-hours, but BVI generally takes 1-week to complete the paperwork.
In order to operate in BVI a company’s name must identify the nature of the company. For example, the company’s name must end with Limited, Incorporated, Corporation, Sociedad Anonima, or Societe Anonyme.
On the other hand, following terminology or business structure/activities are restricted in BVI, Bank, Assurance, Building Society, Chartered, Chamber of Commerce, Fund, Co-operative, Mutual Fund, Trust or Royal.
According to the Company Act, a business must maintain a physical presence in BVI and have an operational registered office within the region. Moreover, the company also needs to appoint a BVI resident agent, who will charge the business an annual domiciliary fee.
Although the offshore companies aren’t required to publicly share or publish their financial accounts, they need to maintain financial accuracy in their books. Non-compliance can land them a fine of $10,000.
You can save a substantial amount of taxes using BVI’s trust services to own company shares. A trust will provide your company, asset protection, saving on inheritance tax, avoidance of probate and smooth continuity in the business.
Sold-out on the no-tax policy of British Virgin Island? Before you start setting up your offshore company, take help from Mikkel Thorup. He provides advice to expats and entrepreneurs on how to reduce corporate tax bill while improving income stream. Click here to register for his weekly podcast.