BELIZE INTERNATIONAL BUSINESS COMPANY (IBC)
IBC - an International Business Company - is the most popular type of offshore corporation, used worldwide for tax planning and asset protection purposes. Every offshore tax haven has its version of IBC legislation. IBC is the cornerstone and the primary product of offshore services industry.
An IBC is a private company which is designed to engage into any international business activity. An IBC is exempt from tax in its home jurisdiction, it has extensive features protecting the confidentiality of its owners and is not subject to any onerous reporting requirements.
A Belize IBC is formed under the Belize International Business Companies Act. This piece of legislation was initially adopted in 1990 and further extended and amended in 2000 and revised in 2011. Belize IBC Act is considered internationally as one of the most modern and user-friendly offshore corporation legislations available today. A Belize IBC is a perfect corporate vehicle for international financial transactions, being especially designed with the offshore investor in mind. Belize´s laws facilitate fast and simple incorporation, and its modern and computerized IBC Registry is capable to process a company registration within one hour.
A full text of the Belize Business Companies Act is available in our "Downloads" section.
BELIZE - ADVANTAGES OF THE JURISDICTION
These are some of the general advantages of Belize as an offshore tax shelter jurisdiction:
Belize has probably the fastest IBC Registry in the world, where incorporation of a new offshore company only takes a few hours.
Belize IBC`s are properly free from any tax in Belize, with only a few simple pre-conditions.
Belize IBC`s are free from any reporting requirements.
Belize has an outstanding record of peace, democracy and stability. Belize is a member of the British Commonwealth, the United Nations and the Non Aligned-Movement. The legal and judiciary system of Belize is based on the English Common Law. The country has not been involved into any conflicts or civil disturbances, unlike some other countries in the region.
Unlike most other offshore tax havens, Belize is not an island and has a fairly robust and diversified national economy. At the same time, offshore services industry contributes significantly to the country`s earnings. Therefore, there is a wide support among the government and the general public to further develop Belize as a premier offshore financial centre. Belize is one of the only two countries in Central and South America having English as the official language.
Belize is easily accessible by sea and air, has modern telecommunications. It`s time-zone location (1 hour behind Eastern Standard Time) make it particularly convenient for communications from the whole of the American continent.
Super-fast incorporation (that beats the time)
Belize provides probably the fastest IBC incorporations in the world. Same-day incorporations are standard in Belize - in reality, new IBC will usually only take a few hours to register! This is due to the highly-efficient, computerised registration system introduced by the Company Registry of Belize.
How does it beat the time? Easy.
When it`s only 10AM in Belize, it`s already midnight in Hong Kong, and 5PM in London. So, while the business day has already finished in the Far East and Europe, it has just started in Belize. This means that you can still incorporate your IBC with TODAYS´ date in Belize, even if "your" today has already closed for business. This has proved to be especially useful for clients based in the Asian jurisdictions. You can spend your whole day negotiating that important business deal! When it´s done, no worries about the new IBC incorporation - it can still be made in Belize, today!
(!) For all first-time clients, immediate incorporation is subject to a timely (electronic) provision of the due diligence documents and the payment being made up-front by credit card or other electronic means.
A Belize International Business Company, by the definition of the law, is not subject to any tax or duty on income or profits. These provisions are provided by Article 130 of the Belize IBC Act.
In particular, all income of a company incorporated under the Belize IBC Act; all dividends or other distributions paid by the company to persons who are not resident in Belize; all interest, rent, royalties, compensations and other amounts paid by the company to persons who are not persons resident in Belize; all capital gains realised with respect to any shares, debt obligations or other securities of a company incorporated under the Belize IBC Act by persons who are not persons resident in Belize, are exempt from all provisions of the Belize Income and Business Tax Act.
A Belize International Business Company is also exempt from any stamp duty on its transactions.
In particular, all instruments relating to transfers of any property to a company incorporated under the Belize IBC Act; all instruments relating to transactions in respect of the shares, debt obligations or other securities of a company incorporated under the Belize IBC Act; and all instruments relating in any way to the assets or activities of a company incorporated under the Belize IBC Act, are exempt from the payment of stamp duty.
(!) Essentially, a Belize International Business Company is a completely tax-free offshore company, for as long as it complies with a few easy conditions. These conditions are listed in the Article 5 of the Belize IBC Act, where the requisite characteristics of the Belize IBC are stated. These are as follows.
- A Belize IBC may not carry on business with persons resident in Belize;
- A Belize IBC may not own an interest in real property located in Belize, except for a lease of property for office purposes;
- A Belize IBC may not carry on a banking business unless it is specifically licensed to do so;
- A Belize IBC may not carry on business as an insurance or a reinsurance company, insurance agent or insurance broker, unless it is specifically licensed to do so;
- A Belize IBC may not carry on the business of providing the registered office for other IBC`s;
- A Belize IBC may not carry on trust business, unless it is specifically licensed to do so;
- A Belize IBC may not carry on collective investment schemes, unless it is specifically licensed to do so;
- A Belize IBC may not hold shares, stock, debt obligations or other securities in a Belize domestic (non-IBC) company;
- A Belize IBC may not issue its shares, stock, debt obligations or other securities to any person or company resident in Belize, except where such shares are held by the licensed Registered Agent or its affiliate in a nominee capacity.
Essentially, the main requirement is that a Belize IBC must not pursue business within the territory of Belize (but it may enter into business with other Belize IBC`s). A Belize IBC may pursue specific financial activities like ones of a trust business, banking, insurance and investment management, but it needs to undergo a specific licensing for that purpose.
In terms of "not pursuing business within the territory of Belize", the following activities are still acceptable for a Belize IBC and does not disqualify it from its offshore company status:
- if the IBC maintains accounts or deposits with a bank in Belize;
- if the IBC maintains professional contact with solicitors, barristers, accountants, bookkeepers, trust companies, administration companies, investment advisers or other similar professionals operating in Belize;
- if the IBC prepares or maintains books and records within Belize:
- if the IBC holds its meetings of its directors or members in Belize;
- if the IBC leases an office in Belize from which to communicate with members or for maintaining, preparing and keeping the company´s books and records;
- if the IBC owns a vessel registered in Belize in accordance with the Registration of the Belize Merchant Ships Act.
A fixed Government license fee instead of taxes
For all its incredible fiscal benefits, a Belize International Business Company must pay a fixed annual fee to the Belize Government. For most International Business Companies, this Government fee stands at $ 150 per year.
The actual amount of the Government fee depends on the amount and type of the authorized capital of the IBC, as follows:
For an IBC whose authorised capital does not exceed $50,000 with all shares having a par value, the annual Government fee is $100 for the first year and $150 from the second year on.
For an IBC whose authorised capital exceeds $50,000 with all shares having a par value, the annual Government fee is $1000.
For an IBC where some or all of its shares have no par value, the annual Government fee is $350.
These IBC license fees are very competitive, in particular as compared to some other more prominent offshore financial centres in the Caribbean. For instance, in two other specifically popular offshore tax havens the minimum IBC license fees are $ 400 in the Bahamas and $ 450 in the British Virgin Islands.
(!) In addition to the Government license fee, certain professional fees are normally payable for company administration services as provided by the Registered Agent. These fees are identified in our list of fees and charges.
A Belize International Business Company is for all legal purposes a separate legal person, and possesses the same commercial rights and powers as a natural person.
At registration, no information is filed on public record on the company beneficial owners, directors and shareholders. This information remains only known to the licensed Registered Agent, who is bound by the law to keep it completely confidential. The internal corporate records of the IBC as the Registry of Members, Registry of Directors and the Corporate Minutes and Resolutions, are all kept by the Registered Agent and are also confidential.
The only documents of a Belize IBC held on public record are the Memorandum and the Articles of Association. These documents do not contain any indication as to the actual beneficial owners, directors or controllers of the company.
All that being said, your offshore venture must never be based on secrecy. It must not rely on blind assumption of total secrecy. Your business must always be based on legality and must be able to withstand legal scrutiny even if fully disclosed.
As any other civilized country, Belize aims to fight international crime and fraud. It is part to multi-national information-sharing agreements and it does co-operate with other countries. Information disclosure in Belize follows strict procedures determined by Mutual Legal Assistance Treaties, only limited amount of information is disclosed and NO information is disclosed to the countries that are not part of such agreements with Belize. There are three types of agreements which may be basis for the information disclosure:
- Belize has signed Tax Information Exchange Agreements. These are in force with Australia, Belgium, Denmark, Faroe Islands, Finland, France, Greenland, Island, India, Ireland, Mexico, Netherlands, Norway, South Africa, Switzerland, Trinidad and Tobago, United Kingdom. Only specific limited information can be disclosed. The information sharing process is a complicated procedure where the requesting country must identify the person and demonstrate realistic grounds for believing that the identified person has taxable assets in Belize. No information is disclosed based on mere suspicions of tax evasion. The disclosed information will not exceed the requested. It means that Belize can only confirm the information that the tax authority of the other country already has in its possession and will not provide any additional information.
- Double Taxation Agreements are in force with the following countries: Antigua and Barbuda, Austria, Barbados, Dominica, Grenada, Guyana, Jamaica, St.Kitts and Nevis, St.Lucia, St.Vincent and the Grenadines, Switzerland, United Kingdom.
- The banks of Belize share the financial information of their account holders according to FATCA and CRS (from 2018) procedures only to the US and the countries that are committed to AEOI (Automatic Exchange of Information).
While these arrangements may appear extensive, the reality is that at this time and age all countries of the world do share tax information, bank information and corporate information, and this information sharing will only become more automatic and more widespread. Countries which still attempt to promote and market “secrecy” are very rapidly shut out of international finance, blacklisted and effectively banned from operating in the modern world. Incorporation of a business in a low-tax, low-burden environment such as in Belize has many advantages, but “total secrecy” will not be one of them. You should never rely on that.
Provisions against confiscation
Where a foreign governmental authority, by means of expropriation, confiscation, coercion, force or duress or similar action; or by means of any confiscatory tax, assessment or other governmental charge, takes or seizes any shares or interest in a Belize International Business Company, the company may apply to the court in Belize for a court decision ordering the company to disregard the attempted seizure and continue to respect the rights of the shareholder of the Belize IBC. In particular, the Belize court may appoint a third-party trustee to hold the shares in the disputed company.
Belize has one of the fastest Registries of International Business Companies in the world. New IBC`s are usually incorporated within 24 hours.
Minimum capital requirements
A Belize IBC does not have any minimum paid-up capital requirement. Any amount of authorized capital can be stated in the incorporation documents of the IBC, as desired by the owners. (Authorized capital is a notional amount of capital which the company may receive from its shareholders in consideration for the company shares.) The amount of the authorized capital can be freely determined at incorporation by the owners of the IBC and there are no mandatory timeframes as to when such capital must be paid up by the shareholders - however, there is a requirement that at their issue, the shares in an IBC must be paid up. All in all, the capital structure of a Belize IBC can be extremely flexible and can accommodate all variety of business circumstances and needs.
The capital of a Belize IBC may be expressed in any currency. The most popular currency of capital for a Belize IBC is US dollar.
The amount of the fixed annual Government fee, payable by a Belize IBC, depends on the amount of the stated authorized capital of the IBC. The "optimum" amount of authorized capital is $50`000 for an IBC with all shares having a par value. This is usually the standard amount of authorized capital stated for new IBC incorporations. However, the owners may certainly designate any other amount of authorized capital for their IBC - be it one dollar or a hundred million dollars.
For those IBC`s, whose authorized capital is more than $50`000 (from there, it can be any figure), the annual Government fee jumps tenfold to $1000. For an IBC where the exact face values of its shares are not determined ("no par value shares") the fixed Government fee is $350.
Out of the authorized capital, there is no requirement as to the minimum amount of shares or capital that must actually be issued and paid-up. An IBC, if its owners so decide, may only issue a fraction of its authorized capital, in which case the remaining amount of its authorized capital may remain unissued or "on paper" for an indefinite period of time.
Flexible corporate structure
A Belize IBC may have a minimum of one shareholder, one director, both of whom may be the same person. There is no requirement to have any Belize-resident directors or shareholders. Foreign individuals or corporations may hold shares in a Belize IBC or act as its directors. Corporate directorship (the directors` function in a company executed by another company) is expressly allowed.
Apart from the director, the company is not obliged to appoint any other officers, however it may certainly do so, if needed.
The shareholder`s or director`s meetings need not be held in the Belize and there is no requirement for a regular Annual General Meeting. If necessary, meetings of the board of directors, or shareholders, of a Belize IBC may be held by telephone or other electronic means. Directors, as well as shareholders, may vote by proxy.
The directors of a Belize IBC may appoint any officers or agents to represent the Company. Subject to the Memorandum and Articles of Association of the IBC, such agent has such powers and authority as the directors may prescribe, except that no agent shall have no authority to amend the Memorandum or Articles of the IBC; to appoint directors or agents; to approve a plan of merger, consolidation or arrangement; or to make a declaration of solvency or approve a liquidation plan for the IBC.
The internal corporate structure of the Belize International Business Company can be designed in accordance with the widest variety of requirements. It may be well designed to suit an one-man business operation, or to accommodate a complex, multiple-shareholder structure with an elaborate system of internal controls and management systems.
A Belize IBC may issue registered shares which may be designated into classes as voting shares, non-voting shares, shares having more or less than one vote per share, shares that may be voted only on certain matters or upon the occurrence of certain events, shares that may be voted only when held by persons who meet specified requirements, no par value shares, common shares, preferred shares, redeemable shares and shares that entitle participation only in certain assets. The International Business Companies of Belize are prohibited to issue bearer shares.
Minimum requirements to books and records
According to the Accounting Records (Maintenance) Act, 2013, every entity shall keep its accounting records within Belize at its registered office or at the office of its registered agent in Belize, or at such other place within or outside Belize as may be determined by its directors or other competent persons provided that where the accounting records of an entity are kept outside Belize, such entity shall provide its registered agent in Belize, with a written record of the physical address of the place(s) where the accounting records are kept.
"Accounting records" include financial statements; general and subsidiary ledgers; sales slips; contracts and invoices; and records and documentation relating to - (a) an entity's assets and liabilities, (b) all sums of money received and expended and the matters in respect of which the receipt and expenditure take place, (c) all sales and purchases, and (d) all financial transactions.
In practice it means that the International Business Companies registered in Belize are required to keep all the documents that show and explain the transactions of the company so that the financial position of the company can be determined at any time. These records do not have to be kept in Belize, the location for keeping such records can be determined by the owners of the IBC by signing a document that indicates the address where the records are kept.
There is no requirement whatsoever to file any commercial or financial records of the Company to Belize authorities or make them available to the general public. Likewise, there are no auditing requirements.
Name requirements for Belize IBC`s
A Belize IBC may not be registered under a name that is identical to the name of an existing Belize company. The registration of a new IBC in Belize may also be refused if its name so nearly resembles the name of another company as to be calculated to deceive, except where the other company gives its express consent.
The name of a Belize IBC may not contain the words "Building Society", "Chamber of Commerce", "Chartered", "Cooperative", "Imperial", "Municipal", "Royal", or any word conveying a similar meaning, or any other word that, in the opinion of the Registrar, suggests or is calculated to suggest the patronage of Her Majesty Queen of England or that of a member of the British Royal Family. Similarly, the name of a Belize IBC must not suggest any connection with the Government of Belize or any of its departments.
A Belize IBC may not register the name containing the words "Assurance", "Bank", "Insurance" or "Trust", or any or their derivatives or cognate expressions, unless it is specifically licensed in Belize to carry on the respective business or activities, as designated by such word.
Generally, the Registrar of Companies may refuse the registration of any particular name of a Belize IBC if, in the opinion of the Registrar, such name is indecent, offensive or, in the opinion of the Registrar is otherwise objectionable. There is a general provision in the Belize IBC Act allowing the Registrar to deny registration of any such "undesirable" name at the Registars` discretion.
The name of a Belize IBC must be registered in Roman script, but an alternative name in any other script may be registered, if it represents an accurate translation of the name registered in Roman script.
The name-endings denoting the type of company
The name of the Belize IBC must contain any of the words "Limited", "Corporation", "Incorporated", "Société Anonyme" or "Sociedad Anonima" or "Aktiengesellschaft" or the abbreviations "Ltd.", "Corp.", "Inc." or "S.A." or "A.S." or "A.G." A company may use and may be legally designated by either the full or the abbreviated form of these limited liability designations.
|Income tax in Belize||None|
|Conduct business internationally||Yes|
|Conduct business within Belize||No|
|Formally considered as tax-resident in Belize||No|
|Official language / language of documents||English|
|Operational objects||Anything that is not expressly prohibited by law|
|Minimum authorized capital||No minimum required|
|Optimum authorized capital (minimum state duty)||$ 50`000|
|Minimum paid-up capital||No minimum required|
|Capital currency||Any. US dollar is standard.|
|Registered Agent in Belize||Required|
|Registered Address in Belize||Required|
|Minimum number of directors||One|
|Register of Directors||To be kept by the Registered Agent|
|Register of Directors filed for public record||No|
|Minimum number of Members (shareholders)||One|
|Register of Members||To be kept by the Registered Agent|
|Register of Members filed for public record||No|
|Holding of Annual General Meeting||Not mandatory|
|Convention of Meetings of Directors / Members||Anywhere in the world, also by proxy|
|Imprint of Corporate Seal||To be kept by the Registered Agent|
|Corporate Minutes and Resolutions||To be kept by the Registered Agent|
|Disclosure of beneficial owners to Registrar||No|
|Disclosure of beneficial owners to Agent||Yes (confidential due diligence)|
|Keeping of accounts||Yes|
|Auditing of accounts||Not required|
|Filing of accounts||Not required|
|Currency controls / restrictions||IBC is not subject to any currency controls|
|Available special types of company||Limited Liability Partnership
Limited Life Company
Public Investment Company
|Redomicile a foreign company into Belize||Yes|
|Redomicile a Belize company abroad||Yes|
|Net time to incorporate||1-4 days|
|Ready-made (shelf) companies||Available|