Offshore Company Formation – British Virgin Islands (BVI)

BVI is the oldest and most flexible financial center in the Caribbean Sea used by millions of entrepreneurs for international trading, asset management, yacht and aircraft business and other purposes. Companies are registered in the form of an International Business Company (IBC) on the basis of the IBC Act of 2004 which inherited the principles of English Common Law.

Basic Information and Calculation of Expenses

Offshore companies in BVI are entitled to carry out any business permitted by law outside the BVI territory. Certain business activities are subject to license (trust, banking, gaming, insurance, etc.).

The registration costs in BVI depend on a quantity of services rendered and start from 890 USD to 1,400 USD. The standard package includes registration license fee, the registered Agent for one year, a company’s seal. The full package also includes nominee services, Apostille, and general POA if necessary.

The annual license fee paid to the Government is 350 USD for companies with up to 50,000 shares and 1,000 USD for legal entities exceeding 50,000 shares.

In addition to that, a bank account will cost from 300 USD (Latvia, Cyprus) to 900 USD (UAE, Singapore).

The issuance of additional certificates which may be required by banks or counterparties are 150-200 USD. Translation services and notary certification are 150-300 USD.

The BVI offshore legislation provides for many flexible options: different types of incorporation, bearer shares, corporate structure, etc. The registered Agent, corporate seal and address are mandatory. Meeting of shareholders and directors may be convened anywhere in the world.

Setup Procedure

The registration procedure is very simple and takes 1-2 business days (notary certification takes 1-3 working days, and 3-5 days for delivery of documents):

  • Selecting a corporate name for a new company. Legal consultants can also suggest ready-made companies for the clients.
  • Electing corporate structure, class and types of shares.
  • Preparation of the documents. Individuals should provide a passport and confirmation of residential address, and legal entities provide their corporate documents and passports of beneficial owners.
  • Filing the documents with the Registrar; notary certification if needed.
  • Upon the confirmation of registration the set of corporate documents is sent to the client by courier.

Taxation in the BVI

BVI companies have zero tax rates. The country entered into double tax treaties with a few counties; however, they are not applicable to the offshore business. Currency control is not envisaged.

Accounting Requirements

BVI companies neither submit their financial statements to the tax authorities not appoint an auditor. It should be noted, however, that offshores are obliged to keep the records of all the transactions for at least 5 years to determine financial status. If a company fails to fulfill this requirement it will pay a fine in the amount of 10,000 USD in accordance with the IBC Act of 2004 as amended. These records are not publicly available.

Advantages of Offshore Companies in the BVI

  • Exemption from any taxes.
  • Full secrecy and confidentiality.
  • Absence of reporting.
  • Flexibility of corporate structure in respect of number of owners, shareholders and directors.
  • The minimum paid up share capital is 1 USD.
  • Provisions against confiscation of company’s shares by a foreign Government.
  • Cost efficiency and simple maintenance.
  • Bearer shares are available.
  • No requirement to specify the objects of a company.