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BVI Offshore Company Formation

The British Virgin Islands (BVI) began registering offshore company in 1984 when the International Business Companies act of the BVI was passed. Since then this act has been replaced by the BVI Business Companies Act which came into effect in 2005. What the new companies’ act of the BVI did was remove every difference which previously existed between the offshore and onshore companies incorporated in the offshore tax haven. The tax haven of the BVI also allows for the formation of British Virgin Islands Trust. The British Virgin Islands is one of the respectable offshore jurisdictions available in the Caribbean region.

Offshore companies formation in the BVI requires very little time and work. Incorporating in the British Virgin Islands is so easy that there is no need for an offshore client to visit the jurisdiction to incorporate an offshore business corporation. Offshore corporations in the tax haven of the BVI must be registered with using the services of a registered agent. This is according to the Business Companies act which states that an offshore corporation will not be incorporated if this is not done by a registered agent in the territory.

Offshore formation in the offshore tax haven of the BVI begins with the completion of A Memorandum of Association and an Articles of Association all of which will be handled by a registered agent. The information within these documents is then filed with the Registrar of Companies who will in turn issue a Certificate of Incorporation which will give the BVI offshore corporation the powers of a natural individual or a legal entity. The following information must be submitted for incorporation in the tax haven of the BVI:

  • The proposed name of the BVI corporation
  • The name and address of the registered agent
  • The registered address of the offshore corporation
  • The purpose for forming the corporation
  • The authorized share capital of the offshore company
  • The currency in which the share capital will be issued
  • If the company is limited by shares
  • State if the offshore company is limited by guarantee
  • State if the company is limited by shares and guarantee
  • Must state if the company is restricted to issue shares
  • Must state if the company can issue shares
  • The maximum number of shares the corporation is allowed to issue
  • Must state if the company is limited or unlimited company
  • Must state if whether or not the company is authorize to issue bearer shares
  • The powers, rights, limitations and privileges of each category of shares issued
  • The by- laws of the offshore corporation

Offshore business formation in the offshore tax haven of the British Virgin Islands will need one (1) director who can be a natural person or another corporation. The directors of BVI offshore companies can be of any nationality and do not necessarily have to be a citizen of the British Virgin Islands. For the offshore company registration in the offshore jurisdiction of the BVI just one (1) shareholder is needed. Offshore company formation in the BVI can be done by persons of any nationality.

One of the major advantages of offshore company formation in the offshore tax haven of the British Virgin Islands is that the companies are tax free. Offshore corporations incorporated in the BVI are not taxed on income which is gained from outside of the territory. The BVI is a pure tax haven and therefore BVI offshore companies will further benefit from no capital gains tax, withholding tax, inheritance tax, corporate tax, gift tax or estate tax. BVI offshore companies are required to pay at the end of each financial year a license fee to the government authorities of the territory this depends on the amount of shore capital that the BVI offshore company incorporated with.

When forming offshore companies in the BVI offshore investors must bear in mind that the BVI as a tax haven has all the important characteristics which tax haven must possess. BVI provides privacy and confidentiality for offshore clients. When forming BVI offshore corporations nominee services can be used which means that the name of the rightful owner of the company does not become public record. The BVI offshore company is not required by law to file its yearly financial statements with the government authorities in the BVI. The annual financial statements of a British Virgin Islands offshore company is available only for the use of the company and can only be inspected by officials of the offshore company. These documents along with the directory of shareholders and company directors can be held anywhere in the world the shareholders choose.

For the investors who are considering asset protection in the BVI an offshore trust can be formed. An offshore trust formed in the BVI and its registration with the Financial Services Commission will depend on the preferences of the persons setting up the trust. The assets in a BVI trust are separate from the trustees. The trustee of a BVI offshore trust is responsible for the general management of the assets in the trust.

To form an offshore trust in the BVI a protector must be appointed. Within the trust papers it must be stated the conditions under which the trust can be terminated or the events which can cause the trust to come to an end. Offshore trusts in the tax haven of the BVI can be formed for charitable and non charitable purposes. The purposes for offshore trusts in the offshore jurisdiction must not be unlawful or against public law in the territory.

The offshore companies formed in the offshore tax haven of the British Virgin Islands have advantages. Offshore corporation formation in the BVI means a company which would allow the owners to reduce taxes drastically. Offshore corporations incorporated in the British Virgin Islands make very good trading companies which has set a reputation for themselves worldwide. A BVI offshore company is very easy to maintain.