Company Incorporation in British Virgin Island

Introduction

The British Virgin Islands (BVI) is one of the largest offshore financial centers in the world and a leading hub for the incorporation of offshore companies.

The British Virgin Islands have a strong regulatory environment at offshore. They have a distinct combination of supervision and a laissez-faire method that makes business both simple – and trustworthy with banks and other jurisdictions across the globe.

The British Virgin Islands have reputable compliance and regulatory body which makes banking with a BVI company very simple and convenient.

Business companies in BVI are also used as vehicles for asset protection, most often in combination with a trust as a holding. BVI BC 's directors may protect the assets by transferring their assets to another company, trust, foundation, association, or partnership; the directors may also merge or consolidate with any other company or may relocate the BC entirely to another jurisdiction.

The BVI Business Companies Act, 2004 states that all BVI-formed international business companies must establish and maintain a Register of Directors, which appoints the initial Director within 30 days of incorporation. Many statutory provisions are minimal and flexible.

There are no requirements to appoint a local director or secretary, there is no need for minimum capitalization, BVI BCs can require and re-issue their own shares.

Shares may be issued and denominated in any currency for a consideration other than cash, with or without the par value.

Key Requirements For Incorporating A Company In BVI

BVI is one of the few places in the world where we still regularly use bearer shares. While over the past decade they have undergone major changes (specifically the BVI Business Companies Act, 2004 as amended) there are still bearer shares. The key requirement for bearer shares is for a "Registered Custodian" to maintain in the file the following:

a. Full name of the beneficial shareholder; and

b. The full name(s) of any other person(s) with a share(s) interest or a declaration that no other person has any interest in the share(s).

Types Of Business In BVI and pre-requisite

The BVI has some of the most diverse corporation structures in the world. When incorporating an IBC, it can be registered as

a. LTD/ limited

b. INC/ Incorporates

c. Corp/ Corporation

d. Sociedad Anonima (SA)/ Societe Anonyme

PREREQUISITES FOR COMPANY INCORPORATION:

a. One director

b. One shareholder

c. No minimum capital requirement

Incorporation can be done within two to three days, Shareholder and executive details are not published in a public registry. In addition, candidate directors and shareholders are commonplace and can be used to further enhance privacy at a slightly higher price to ensure optimum secrecy and safety.

Benefits of incorporating a business in BVI

1. Do not apply additional tax levels to tax already charged by investors in their country of origin
2. Do not place new statutory standards on corporate governance, enabling businesses to develop their own model.
3. Doesn't need minimum share capital
4. May migrate from or into any other jurisdiction that permits such migration
5. Can combine with one or more BVI companies or foreign companies and the surviving company may have jurisdiction over another
6. Can acquire a member 's shares through a solvency test and the member's consent
7. Have no limits to financial assistance
8. Have low maintenance costs

Taxes applicable on businesses in BVI

BVI international business Companies, even if administered in BVI, are excluded from local taxes and stamp duties. Only applicable for registration and annual license/franchise fees. In addition, the BVI Business Companies Act allows BCs to do business and own real estate in the British Virgin Islands, unlike other offshore vehicles.

Corporate income tax – The British Virgin Islands does not levy corporate taxes including no capital gains and investment income taxes. It also exempts all dividends, compensations, rentals, and royalties from BVI income.

No withholding tax is levied on payments to non-residents by dividend, interest, and royalty.

While there is no interest tax, the BVI has introduced the EU Savings Guideline, which means that agents making interest payments to citizens of an EU Member State must immediately share information with the tax authorities of the relevant Member States about the identity of the beneficial owner and the payment.

Other taxes-BVI do not levy personal direct taxes. Personal income and capital gains, net wealth and inheritances are not taxable.

In the British Virgin Islands, stamp duty is levied on land transfer. The value of the contract or the market value is imposed and ranges from 4% to 12%.

Land tax is levied annually between half an acre and one acre at USD 50 for half an acre or less, and USD 150. Every additional acre or part of an acre shall be taxed at USD 50 every.

Documents required for incorporation:

a. Complete an application form with preferred name information and beneficial directors and shareholders information (nationality, country of origin, address, occupation, etc.).

b. A scanned and notarized copy of the proposed directors and shareholders' passport is required.

c. A photocopy of another official document (such as driving license, ID card etc) notarized to ensure the copy is a true copy, and the photo is a true likeness.

d. An original proof of residency indicating the individual's name and address is needed. This can take the form of a utility bill or bank statement and must not be more than three months old.

e. It needs one initial letter of introduction. This letter may come from a, lawyer, professional accountant or similar.

f. Both Shareholders and Directors have completed and signed a Beneficial Owners Declaration (BOD).