The British Virgin Islands (BVI) is a territory under rule located in the Caribbean sharing its eastern border with Puerto Rico through the Francis Drake Channel. Its main city, Road Town has a population of than 30,000 people. The official currency used in the British Virgin Islands is the United States Dollar (USD) and English is the primary language spoken.
Governed by the BVI Business Companies Act of 2004 this region has established laws for company formation, regulation and other business related activities. The government functions as a system within a constitutional monarchy.
Company establishment in the BVI plays a role in generating revenue for the government with licensing fees from companies contributing more than half of the annual income. Known for its offshore regulatory standards the BVI is home to the BVI Financial Services Commission. An independent body overseeing company operations and financial services, on the island.
Advantages of Establishing a Company in BVI:
- Political and economic stability.
- Simplified processes for incorporation, operation, and maintenance.
- Recognized as a classic offshore jurisdiction.
- Tax-free regime for offshore entities.
- Requirement of just one shareholder.
- No minimum paid-up share capital necessary.
- Confidentiality maintained for directors, shareholders, and beneficiaries (not publicly available).
- Non-residents permitted to register offshore companies for various lawful activities.
- Flexibility for non-residents or citizens to establish companies, with options for re-registration outside the jurisdiction.
- Nominee services allowed, facilitating anonymity and privacy.
- Asset protection measures available for business interests.
Types of companies in BVI:
- International Business Company (IBC) and shelf corporations (both available).
- Company limited by shares.
- Company limited by guarantee.
- Hybrid company (limited by guarantee but with the right to issue shares).
- Unlimited company (without the right to issue shares).
- Segregated portfolio company (Protected cell company).
Certain conditions must be met depending on the type of business companies:
- The name of the company should have endings like Limited, Incorporated or Corporation (LTD, Inc and Corp). Chinese names are also acceptable.
- The minimum authorized capital should be $50,000 in US currency. Actual contribution is not compulsory.
- Registered shares are accepted, while bearer shares are not allowed.
- A company in BVI must have least one shareholder and one director. A legal entity can serve as a director and the appointment of nominee directors and shareholders is permitted.
- There are no taxes involved. There is no need, for audits or submission of annual reports.
Business in BVI: taxation
Source: google.com
- Corporate tax rate: 0%.
- Personal income tax: 0%.
- Value Added Tax (VAT) rate: 0%.
- No access to taxation treaties.
- BVI has signed Tax Information Exchange Agreements.
Company formation requirements for BVI
Source: google.com
- Certificate of incorporation
- Articles and Memorandum of Association
- Minimum of one shareholder and director
- A legally registered office
- A legally registered agent
- Directors Acceptance Letter
- Share(s) certificate
- Articles and Plan of Consolidation
- Notarized passport copies
It’s important to understand that although the process of setting up a company in the British Virgin Islands is usually straightforward the laws governing companies are subject to updates. Therefore it’s crucial to stay informed about any changes to ensure compliance with regulations. Recent updates have made it more stringent for investors coming into the jurisdiction to be identified.
Currently in order to complete the registration of a company in the British Virgin Islands owners, with interests must submit bank statements from a local bank dating back at least six months. Additionally it is necessary to provide confirmation of the founders official address and personal details.
Moreover the BVI Substance Act, which came into effect on January 1 2019 focuses on companies and limited partnerships established or registered under regulations excluding those not based in the BVI. However, certain entities, such as investment funds and non-resident companies, are exempt from the act if they meet specific criteria.
