Time of establishment of the company
The British Virgin Islands, the overseas territory of Great Britain, is a stable country with a highly developed (for the Caribbean) economy. It consists of 36 islands covering an area of 153 square kilometres and is inhabited by 22700 people, most of whom live in the capital, Road Town on the island of Tortola.
This jurisdiction is an attractive location for offshore companies – they guarantee ease of operation, simplicity of the legal system and access to the markets of former British Empire countries. In the British Virgin Islands it is also possible to use the services of nominee directors, maintaining anonymity in the National Register (Public Registry) and nominee shareholders in order to maintain a transparent shareholding structure.
What to keep in mind
The British Virgin Islands have for a long time been the main site for registering offshore companies, with more than 160000 registered, but this trend has lost strength after 2005 and especially since the beginning of the economic crisis in 2008, when more and more attention was paid to the company’s image. The tropical, exotic image of the British Virgin Islands makes it more likely that it would be for example Hong Kongs chosen as the headquarters of an offshore company, where the economic reality is much more obvious as it has12 million inhabitants and not 10,000 like Tortola.
The choice of this region should be carefully considered. This may be met with reluctance on the part of customers, partners and suppliers. If your company’s image is crucial to its business, due to the notoriety of the British Virgin Islands, we recommend that you consider other jurisdictions, such as Gibraltar, London or Dubai. If you have any concerns, we will be happy to assist you in making the right decision.
Type of company
The most common type of company in the British Virgin Islands is I.B.C. – The International Business Company and it is a limited liability company.
Company registration procedure
Registration of the company:
- Reservation of the name,
- Verification of KYC and AML’s actual beneficiaries,
- Preparation of a memorandum of association and articles of association,
- Designation of a registration agent,
- Registration of the company in companies house,
- obtaining registration documents of the company, including a certificate of incorporation with apsotille clauses.
There are no restrictions on the number of shareholders, however, a minimum of one shareholder is required to establish a company. Foreign shareholders and nominated shareholders are allowed. Bearer shares are prohibited.
A minimum of one director is required to manage the company. The director may be a shareholder, natural or legal person or a local nominee.
The Company must have a registered address in the British Virgin Islands, which will appear on the Company’s business documents and postal details. It is possible to use the services of a virtual office with a dedicated telephone number.
Time to set up a company:
The time of establishing a company is about 5 days.
The standard capital in BVI is $10000, but there is no obligation to deposit it within a specified period of time. In practice, this makes it possible to establish a company with a capital of 1 USD.
Taxes and finances
Corporate income tax in the British Virgin Islands is 0%. Under local law, IBCs (International Businesss Company) are not taxed and therefore:
- There is no corporate income tax,
- There are no customs duties,
- There is no property tax,
- There is no VAT,
- Invoices for services do not include any tax.
Due to complete non-taxation, companies are not obliged to keep accounts. There is no obligation to submit reports.
Companies in BVI may paly the role of holding companies, managing movable and immovable property and hold shares in other companies.
A company registered in the British Virgin Islands is required to extend its operations on an annual basis, e.g. by paying stamp duty and re-establishing the company’s governing bodies.
Conditions for establishing a company
The last condition is the legality of the company’s operations both in the British Virgin Islands and in the country in which it will operate. The establishment of a foreign company should not and must not be used to legitimise illegal activities. Regulators in the British Virgin Islands do not allow financial activities, banking, betting, online gambling and insurance activities.
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