When planning on establishing an International Company a common question is what are the advantages of Belize as an offshore jurisdiction.
Belize, which was previously known as British Honduras, is an independent Commonwealth country in Central America, with an unspoilt Caribbean coastline. Belize borders Mexico and Guatemala.
Belize`s pristine nature, and beautiful coastline is famous the world over for its barrier reef and numerous scenic cays. This natural beauty has made Belize a frequent, and well-destination for tourists of all kinds. The beauty of Belize does not only arise from its coast, but inland as well. The small Central-American nation also boasts tropical jungle, untouched woodlands, natural caves, tropical rivers, and many fascinating remnants of the ancient Mayan civilization. The biological diversity and climate of Belize ensures its position as a major exporter of tropical agricultural products, such as bananas, sugar, citrus, tropical fish, timber and other forestry products. This wealth of natural resources accounts for the bulk of Belize’s economy, but as also allowed for the history of Belize to be relatively peaceful.
In fact, Belize is unique amongst it’s Latin-American neighbors on account of its long history of stability, peace and democracy. Belize was originally a colony of Great Britain, being founded in 1862. It achieved independence and complete self-rule in 1981. Belize’s history as a crown colony is reflected in its legal system based on the common law tradition, and English as its official language. An additional legacy of Belize’s British past is its status as a Commonwealth country.
This history of peace and stability, and business friendly common-law legal system has not only allowed for the cultivation of the agricultural industry. On the contrary, the business environment in Belize is quite favorable for all sectors, most notably on account of its common law history, and flexible regulations. Belize is famous worldwide with its minimal regulatory restrictions, and unobtrusive bureaucracy. The offshore finance industry has been experiencing rapid growth on account of the same, and has been responsible for producing an ever growing percent of the national income.
GENERAL Type of Entity Belize IBC Legal System Common Law Primary Corporate Legislation The International Business Companies Act, 1990, as amended in 2000. Shelf Companies Permitted Yes Company Formation Time One day - two weeks Minimum Mandatory Government Fees $ 100 (USD) Corporate Taxes Yes, with physical presence Double taxation treaty availability No
Default Currency USD Alternative currencies permitted All Minimum paid up capital No Minimum Standard authorized capital $ 50,000 (USD)
Mandatory minimum number of directors One Domicile Anywhere Corporate directors Permitted Records of directors publicly available No Meeting location requirements Anywhere, including teleconference Frequency of meetings No requirement
Number One Shareholder information on public record No Nationality Restrictions None Meeting location requirements Anywhere, including teleconference
ACCOUNTS AND BOOKKEEPING
Must prepare and maintain Yes Account location requirements Anywhere Audits May be required by the Commisioner of Income Tax if annual receipts are at least 6.000.0 Account filing requirements None Public record of company accounts No
Redomiciliation to or from jurisdiction allowed Yes Mandatory filing of annual return No SOME TYPICAL USES To set up accounts for trading securities in the United States, Europe, Canada, or in Belize directly To hold real estate titles outside of Belize To hold patents, or other IP rights, and collect royalties As a holding company
The laws of Belize provide for the following business types
- International Business Companies
- Belize International Trusts
- Belize Mutual Funds
- Belize Limited Liability Companies
- Limited Liability Partnerships
- Joint Ventures and Cooperatives
- Sole Proprietorships
- Public Investment Companies
- Private Domestic Companies
Despite the wide variety of business entities available in Belize, the great majority of all offshore activity is undertaken with the International Business Company or International trust form. In fact, these two entities are often used in conjunction.
Belize International Business Company
Belize International Business Companies (IBC) are formed under the International Business Company Act of 1990.
The principal features of Belize IBCs are:
- No minimum capital must be paid up
- Authorized capital can be set in any currency
- A minimum of one director, and one shareholder is required.
- Directors and shareholders are not limited to only natural persons, legal persons are also permitted.
- Nominee shareholders are permitted, and a common practice
- Licensed Registered Agents are required, as are a Local Registered Office
- Only the address and name of the IBC’s registered agent is available as public information
- Belize does not require IBCs to file any information about shareholders or directors
- No audit or accounting requirements in place
- No regular meetings are required for directors, and when meetings are held they can take place anywhere.
- IBCs are not restricted by any exchange controls.
- Company’s may redomicile to and from Belize.
Despite the flexibility of the Belize IBC, some restrictions are in place, namely:
- A Belize IBC may not carry on business with Belize residents
- May not own real property in Belize, save for leasing office space
- Belize IBCs are prohibited from conducting banking business
- Insurance and reinsurance undertakings are also forbidden
- An IBC may not be a licensed Registered Agent, or provide Registered Office services for other IBCs
Besides these minimal restrictions, Belize IBCs are free to conduct any other activity that is not illegal in Belize.
International Trusts in Belize are controlled by the Trusts Act of 1992. This act was drafted with flexible, and modern asset protection methods in mind. A Belize trust, if properly settled, may not be set aside for any claims from creditors in other jurisdictions, the orders of foreign courts, bankruptcy, divorce, or other methods typically used by creditors to pursue assets.
There is no requirement to register trusts in Belize. Registration, however, can be undertaken by the Settlor or a Trustee, by submitting a certified copy of the trust deed to the Registrar The Register of trusts, is not open to public inspection. Instead it is only available for viewing if the trustee of a given trust authorizes such an inspection in writing.
The maximum duration of a trust in Belize is 120 years from creation. Trusts are permitted to accumulate income for any period which does not exceed the maximum duration established by law.
International Business Companies
The Belize International Business Companies Act specifically exempts IBCs from all income, capital gains, or transaction taxes.
Belize IBC`s are additionally exempt from stamp duty on:
- Any documents or instruments dealing with the transfer of property to or by an IBC
- Any instruments dealing with transactions involving IBC securities
- Any other documents or instruments relating in any way to the assets or activities of an IBC
International (Offshore) Trusts
Belize Trusts are exempt from all taxation on any Trust income earned outside of Belize, so long as the Settlor and Beneficiaries are not Belize residents.
The following list of statutes comprises the principal Belizean laws dealing with the offshore industry
Commercial Free Zone (CFZ) Act 1994
Exchange Controls Regulations 1980
Export Processing Zone (EPZ) Act 1990
Fiscal Incentive Act No. 6 of 1990
IBC Act, 1990
Income Tax Amendment Act 1998
International Insurance Act, 1999
Limited Liability Partnership Act, 1999
Limited Liability Company Act, 2011
Money Laundering (Prevention) Act, 1996
Mutual Funds Act, 1999
Offshore Banking (Amendments) Act, 2002
Trusts Act, 1992
Trusts (Amendment) Act, 2007
Main reasons to choose Belize:
- Belize probably has the fastest IBC Registry in the world - incorporation of a new offshore company can takes as little as a few hours.
- Belize IBCs are 100% free from any taxation in Belize, all it takes is a few simple pre-conditions.
- Belize IBCs are exempt from any reporting requirements.
- Belize has an outstanding record of peace, and democracy, which has led to long term economic and social stability. The history is likely associated with Belize’s history as an English colony, which has resulted in a legal and judiciary system based on the English Common Law. Belize is still a member of the British Commonwealth, as well as a full member of the United Nations and the Non Aligned-Movement. Moreover, the country has not been involved in any of the regional conflicts, or civil disturbances that have plagued its part of the world. Additionally, Belize has not suffered any serious social upheaveal , regime change, revolution or other related problems associated with political or economical instability.
- Unlike most other offshore tax havens, Belize is not an island, and has a prosperpous, well-diversified national economy. At the same time, the offshore services industry contributes significantly to the country`s earnings. Therefore, there is wide support by both the government, and the general public to further develop Belize as a premier offshore financial center. Belize is the only country in Central and South America with English as its official language.
- Belize is easily accessible by sea and air, and has modern telecommunications systems in place. Its time-zone location (1 hour behind Eastern Standard Time) makes it particularly convenient for communications from anywhere in the American continents.
- IBC incorporation with prices starting from $0 *.
- Belize International Asset Protection Trust (IAPT) formation starting from $1,0 *.
- Belize International Foundation formation starting from $1,0 *.
- Belize Mutual Fund establishment starting from $4,500USD*.
- Fund Manager/Administrator Licensing starting from $3,0 *.
- Special Licensing for Belize IBC`s, under 13 different licenses, from $10,0 *.
* The total cost may be higher depending on all additional optional services required.
This should help you to weigh out the pros and cons when struggling to choose a jurisdiction for your IBC. Don’t forget though, we also offer incorporations in Seychelles and the British Virgin Islands, all of which have their own set of circumstanctes, advantges, and benefits.