Belize is a relatively small country in Central America that has become a convenient tax haven for offshore business registration.
The tax regime in Belize is favourable to business development. For example, corporate profits from certain business activities in the country are subject to corporate tax at a preferential rate of 1.75%.
And if an offshore company is physically absent from its country of incorporation, it is exempt from paying tax on profits earned abroad.
The authorities do not force their entrepreneurs to pay stamp duty on transactions with real estate and securities. There is also no capital gains tax in Belize.
In this country, your assets will be well protected by law and if there is a disagreement, you can always resolve it in an independent court.
According to the experts of our company, Belize favourably distinguishes from other offshore jurisdictions comparative simplicity of the procedure of opening a company.
Foreign founders can open their companies remotely without travelling to Belize. In the same way, remote meetings of directors and shareholders of companies already established in the country can be organised using modern video communication facilities.
A resident of absolutely any country in the world has the right to open a company in Belize, regardless of who it will be — an individual or another firm. This jurisdiction does not require the appointment of a local resident as a director. To register an offshore company is enough one founder and one director, and the same person or company can combine both functions in his person.
Official registration of a company in Belize takes one working day. About 2 working days are spent on drafting the company’s statutory documents and their approval by a notary. Up to a week is spent on courier delivery of company documents to the founders. With competent legal support agents of our company you will take less than 2 weeks to launch an offshore business in Belize.
The cost of registering a company in Belize is significantly lower than in other states with comparable conditions for foreign entrepreneurs. To establish a joint-stock company, a businessman does not need to possess an impressive sum of money, because the authorities of Belize:
Do not force entrepreneurs to pre-fund the company’s share capital by depositing the appropriate amount of money in a designated bank account in Belize;
They have not set a minimum amount of founding capital for companies to be registered, so it can be anything, even $1.
The Belizean government authorities can only recommend that an enterprise declare a particular amount as its nominal share capital. For example, offshore companies are now advised to declare $50,000 as their nominal share capital.
Since excessive bureaucratisation of business processes often hinders the development of entrepreneurship in the country, the Government of Belize has deliberately reduced the number of inspections and reports for commercial companies.
Perhaps it is for this reason that companies incorporated in Belize do not need to hire a local corporate secretary — a special person or firm – to handle the paperwork and keep track of incoming correspondence.
Information about the management, founders and beneficiaries of Belizean offshore business structures is not made publicly available. And those who want to further secure their personal data can freely use the services of nominees.
Your choice will largely be dictated by the objectives that your business will fulfil. As in any other modern country, in Belize a foreign entrepreneur can choose the most convenient type of company from several available options.
If it is a Belizean resident’s small business where he will be both a sole proprietor and a director, it is possible to register as a sole proprietor.
This one of Belize’s most popular corporate forms is well suited for launching a small startup. It is generally not burdened with excessive tax and financial reporting.
An individual entrepreneur pays income tax as an individual and does not have a separate legal personality from his business. The latter, translated from legal language, means that by choosing this legal form, the businessman will be fully responsible for the results of his commercial activities.
Limited Liability Partnership is often used in Belize to formally register a professional association, such as lawyers, accountants or financial advisors. These types of organisations allow for the concentration of significant resources, collaborative working and at the same time protect personal assets from potential business risks.
Belizean LLPs combine the flexibility of an unincorporated business structure with the protection of personal liability of the founders usually inherent in publicly traded companies. Each partner is not liable for the debts of the entire organisation or for the negligence of other members of the partnership but is responsible for his or her own actions.
One of the main advantages of an LLP in Belize is transparent taxation. The profits of a Belizean partnership are not taxed. Once it is distributed to the LLP partners, the partners will have to declare their income and pay taxes.
A limited liability partnership in Belize usually consists of two or more individuals who jointly own one company. All partners of an LLP enter into a contract between them which sets out all matters relating to the partnership, including how decisions are to be made in the organisation, how profits are to be made, how conflicts are to be resolved, etc.
A Limited Duration Company is a unique type of corporate structure in Belize that combines the advantages of a limited liability company and a period partnership.
LDCs are usually used for joint ventures, construction projects or property management. A company established for a limited period of time is ideal for foreign investors. Such firms are usually exempt from local taxes, which makes them attractive for international business.
LDCs provide foreign entrepreneurs with the same management flexibility as in a partnership, while limiting their liability for the company’s debts and financial obligations. The predetermined life of the firm allows investors to develop a clear exit strategy in advance, which is another obvious advantage when your objective is to buy a property or finance a specific project.
The legal basis for the operation of public investment companies in Belize is the “Mutual Funds Act”. Such organisations are used for collective investments. In other words, a PIC is a mutual fund, i.e. a company where several investors (individuals and legal entities) contribute their funds, which are then invested in various assets.
The founders of public investment companies in Belize are local and foreign investors, other investment companies, as well as investment fund managers. The main purpose of PIC is to professionally manage funds and generate income. In parallel, with the help of such a firm, investors diversify their investments.
Public Investment Companies are generally exempt from taxation in Belize and can claim significant tax benefits. On the other hand, PICs must comply with all regulatory requirements, including regular reporting and financial disclosure. This ensures transparency and protects the interests of potential investors.
Individuals with significant assets and family capital often establish trusts in Belize. In a trust, the investors (beneficiaries) place their assets under the control of a trustee to manage them for the benefit of the beneficiaries.
Trusts are used for wealth and estate management, as well as asset protection and privacy. Such organisations are attractive to individuals who want to provide their family members with long-term financial stability for the future.
One of the key advantages of a trust is the high level of confidentiality. As a rule, information from the trust agreement is not public information. Trusts in Belize also provide strong asset protection as they are not subject to foreign court judgements. In addition, they are exempt from a range of taxes if the trust beneficiaries are not residents of Belize.
In order to enjoy the above benefits, trusts must comply with all the rules set out in the ‘Trusts Act’. The Act includes requirements for good governance as well as specific provisions relating to the appointment of trustees and the operation of the trust.
From the offshore period of Belize’s existence to the present day, the international business company remains a highly sought after form of business by foreign entrepreneurs. Therefore, our experts will talk about this type of company in as much detail as possible.
Modern IBC’s can no longer be considered offshore structures as they now have tax obligations. In 2019, Belize’s corporate laws were amended to change the legal status of international business companies.
However, the Belize IBC has retained its most attractive features for foreign businessmen. As before:
Founders can be people and other companies, including those of foreign origin. The founders do not need to deposit the authorised capital in a special bank account;
In such companies, it is not necessary to hold an annual shareholders’ meeting;
It is not necessary to appoint a Belizean permanent resident or citizen to the position of Director of the IBC;
The personal information of IBC’s directors, shareholders and beneficiaries is not placed on public registers;
IBC does not pay tax on profits made if:
A firm’s activities cannot be categorised as relevant, i.e. requiring an economic presence in the country;
The company’s profits are generated overseas.
To learn more about what is considered relevant commercial activity in Belize, please see the answers to the questions at the end of our article.
New options available to IBCs following the amendments to the corporate laws include:
Seamlessly buy property in Belize;
Open current accounts with local banks;
Purchase shares in Belizean companies and otherwise invest within the country.
IBCs pay a special levy every year to continue their work. The amount of payment is directly proportional to the size of the company’s authorised capital.
Foreign entrepreneurs are more likely to choose this jurisdiction to be successful:
Engage in international trade and trading through online marketplaces;
Create holding structures;
Manage intellectual property;
Receive an inheritance, own and dispose of assets, including real estate.
Whatever activity you plan to carry out in Belize, do not forget that some types of business under current corporate law require sabstensa — economic presence of the company in the place of registration.
In 2019, Belize passed The Economic Substance Act, which highlights 3 key attributes of a firm’s economic presence in the country:
The Company has purchased or leased an actual office space in Belize and maintains its operations.
The company employs full-time permanent residents or Belizeans. Depending on the size of your company’s operations, different numbers of local employees are considered.
The management, control, and sometimes even the main activities of the company are carried out directly in Belize.
You may need a licence to run your business, especially if you intend to operate from your place of incorporation.
Imperial & Legal consultants highlight 5 key stages of incorporating a new business in Belize.
Foreign entrepreneurs are mostly unaware of all the nuances of corporate law. Therefore, in order not to waste their time and money, they hire professionals. With our qualified support you will register your company in Belize quickly and without additional costs.
You should come up with a name for your company in Belize. Imperial & Legal can help you agree and secure a name for your company before the incorporation documents are drawn up and the application for official registration is submitted.
The requirements of the authorities to the name of the company do not differ from similar requirements in other countries. First of all, in the name may not use the names of already existing in Belize legal entities and trademarks. Names that are misleading or contain insults, discriminatory context, etc. are not allowed.
Every new company is registered in Belize at a real existing address. We are ready to provide you with a legal address.
Another important step will be the preparation of constituent and related documents:
Memorandum of Association (memorandum);
Company’s Articles of Association;
Copies of documents of shareholders and founders;
Registration Application Forms.
Our company’s specialists will help you to draw up incorporation documents, as well as collect and translate all supporting documents into English.
Experienced registration agents recommend that to this package of documents add a competent business plan of the future enterprise, so that your company is guaranteed to be included in the commercial register.
When all documents are collected and approved, they are submitted to the Registrar. As a rule, the actual procedure of official registration of a business in Belize takes no more than one working day. The company is entered into the commercial register, the entrepreneur or his representatives are given a Certificate of Registration by the authorities.
Our co-operation with entrepreneurs does not end there, as a newly established company requires assistance in opening a corporate account with a local bank or one of the international financial institutions.
All private companies in this country are conventionally divided into 2 large categories: offshore and resident.
Offshore or non-resident companies in Belize include business structures whose profits arise from commercial activities abroad. Usually such firms have foreign founders, and their business does not require a physical or economic presence in Belize.
Although the government has been declaring for several years that the rules regarding IBCs have changed significantly, offshore companies, as in the recent past:
Exempt from corporate tax if they can document the foreign origin of their income;
Count on complete confidentiality by providing authorities with the personal details of beneficiaries, founders and directors;
Not burdened by complex corporate reporting.
Not having a tax residence in Belize, international business companies are exempt even from paying VAT. But all without exception IBCs are obliged to pay an annual fee to the state to prolong their existence.
It is favourable to do business in this jurisdiction, even for those firms with a significant economic presence. The standard corporate tax rate for ordinary trading activities is only 1.75 per cent.
However, income from certain domestic activities is subject to a higher corporate tax:
Professional services are subject to corporate tax at the rate of 6%;
Licensed financial services provided by non-residents are subject to a 3% tax;
You will need to pay 3% tax on your rental income.
For certain types of commercial activities in Belize, the corporate tax rate can be as high as 19%.
The corporate tax rate for resident IBCs ranges from 1.75 to 3%, depending on the amount of income earned.
If the firm’s income at the end of the accounting period did not exceed the $37,500 mark, the company is exempt from paying corporation tax.
12.5% in Belize is the local equivalent of value added tax.
If you hire local employees, your social security payments will be 7.31 per cent of your salary.
Belize has zero tax rates on the following types of income:
Capital Gains;
Dividends and interest on shares paid by international business companies to non-Belize tax resident persons;
Royalties and other licence payments, provided they are received by a non-tax resident.
There are more than 14 international double taxation treaties between Belize and other countries. Tax information exchange agreements have also been signed with most of these jurisdictions, which makes it much easier to obtain tax relief.
To fully realise all the opportunities for tax optimisation in Belize, use the services of financial advisors of our company.
Our staff have a wealth of experience in successfully handling a wide range of tasks: from business registration in Europe, the USA and the Caribbean to immigration support and organising relocation to another country.
Rely on the experience and knowledge of Imperial & Legal specialists when incorporating a new business in Belize, preparing your first financial statements or optimising your taxes. Professional legal support will help you save time, energy and money!
In this country, relevant business activities are those that can only be conducted by companies with a sabstens — an economic presence in Belize.
Such activities include:
Banking and insurance business;
Financial Asset Management;
Investing;
Leasing;
Shipping business;
Activities of holding companies;
Head office work in a group of companies.
It is irrational to carry out relevant commercial activities without sabstensis, because for such a violation, a company registered in Belize can be fined up to $350,000. And repeated violations of this requirement lead to removal of the company from the official commercial register.
In this jurisdiction, a firm must prepare and submit a financial statement and tax return each year. Generally, a company’s financial statements and tax return are due at approximately the same time.
The standard reporting period in Belize coincides with the calendar period — it starts on 1 January and ends on 31 December. Both reports must be submitted no later than 9 months after the end of the financial year.
Tax Exemption Certificate — the main document for an offshore IBC, which gives the latter the right to receive tax benefits, including income tax exemption.
In other words, such a firm is recognised as an offshore firm and will only realise the full benefits of this status once it has obtained the appropriate certificate from the Belize Revenue Authority.
You are entitled to rely on a Tax Exemption Certificate if your firm:
Makes commercial profits overseas;
Does not have its own or leased office premises, warehouses, manufacturing or retail premises, or employees in Belize;
He submits a tax return and pays income tax at the place where the profit is received, i.e. abroad.
The articles of incorporation of a Belizean company shall include the following information:
Approved firm name;
The registered office is in Belize;
Data of the registration agent in Belize: address, name or title (if the agent is a legal entity);
Objectives of the established company;
Information on share capital: total stated value, currency in which shares are denominated, value of 1 share, number of shares to be issued, etc.
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