BVI Offshore Company

The British Virgin Islands are a politically and economically stable jurisdiction located in the Caribbean region east of Puerto Rico.  Since the mid 1980’s they have supplemented their substantial tourism based economy through offering superior offshore solutions and services such as BVI offshore company formations.

The favoured type of BVI offshore company is an IBC and this article discusses the benefits of incorporating in the jurisdiction and how to go about setting up an IBC in the British Virgin Islands.

The main advantage of incorporating an IBC in the British Virgin Islands is of course the taxation aspect.  Regardless of the director and shareholder’s country of residence, an offshore company established in the BVI will have no taxation liabilities.  The rate of income tax an IBC is exposed to is 0% and companies are free from capital gains taxes, inheritance taxes and death duties as well.  When it comes to earnings that are free from income tax this includes all earnings regardless of whether they are generated from dividends, interests, royalties, rents or compensations for example.  The only tax a BVI IBC is liable for is an annual government tax which is currently USD 350.

Other than the obvious and very attractive taxation advantages to incorporating in the BVI there are a series of other benefits and these include minimal compliance, accounting, share capital and company meeting requirements, no foreign exchange controls, multiple share types and the ability to access diverse investment opportunities. 

A BVI offshore company need only have one director and one shareholder and these can be the same person.  The director and shareholder’s details are not made public, no BVI IBC is required to submit annual accounts and there are no requirements for minimum or maximum share capital and multiple classes of share can be issued.

Because the British Virgin Islands have one of the most stable economies in the Caribbean region and are an overseas territory of the United Kingdom, they are considered to be an economically and politically stable jurisdiction.  Offshore company legislation is maintained under the terms of International Business Companies Act of 1984 and the jurisdiction is the preferred offshore tax haven for the Far East region in particular.

To incorporate a BVI offshore company takes only 24 hours – although company documents will take longer to arrive and a number of reputable offshore company incorporation service providers offer off the shelf companies for those who need to incorporate in a hurry.  The incorporation fee is around USD 750 and annual addition fees include the government tax of USD 350 and any domiciliary services required by those incorporating their IBC in the British Virgin Islands which can be in the region of USD 900 for a registered office, local resident agent and company secretary.

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