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Belize

Belize

from 125 €

Company Incorporation in Belize (Offshore)

Setting up a company in Belize, thanks to the extremely low taxation parameters, is quick and easy.
Belize’s jurisdiction offers many advantages to investors and professionals to establish an international business in the country. There are tax breaks, import duty reductions and trade free zones.

Capital: Belmopan
Official language: English
Currency: Belize Dollar (BZD)
Population: 420,000 (2020)
Tax system: Zero taxation
VAT: from 0.75% up to 19% on Companies
Average salary:  3.920 BZD (166 €)

Opening a company in Belize

Low taxation makes Belize, formerly British Honduras, a jurisdiction that offers a favourable combination of several important advantages, such as financial privacy, tax neutrality and convenient company formation. Most offshore territories grant only one of these options, in Belize all these requirements combine to create a favourable and stable business climate, ideal for:

  • Business people
  • Internet commerce (E-Commerce)
  • International companies
  • Intellectual Property Rights
  • Custody of movable and immovable property
  • Stockbroker/forex broker

Why Belize?

Belize is considered one of the most favourable countries for international trade and business by virtue of an attractive and effective tax regime, which is what makes it such a convenient business destination for investors looking to start a business.

Another exciting possibility that entices international entrepreneurs to set up a business is the availability of investment incentives available from the Caribbean country. There are no restrictions for foreign investors who wish to purchase their properties in Belize as well. The tax incentive package, for example, eliminates customs duties so that foreigners are not subject to these taxes.
In addition, foreign investors can enjoy a 20-year tax-free allowance as well as multiple operational incentives if they fall under the Export Processing Zone programme.

Advantages

Belize, one of the most politically stable countries in Central America, offers countless advantages in setting up offshore companies. The attractive tax regime imposes zero capital gains tax on any income generated from Belize or within the country.

There are no corporate taxes so there are no requirements for annual reporting. There are a few simple accounting requirements that one of our experts can help you with.

In addition, the residency program allows the eligible population (45 years and older and their families) to reside in Belize without the hassle of filing tax returns or paying customs duties on personal property (including vehicles). Here are the reasons why it is good to start a business in a country that has long been labelled as a growing business destination.

Company formation

Company formation is a fairly simple process, just what every investor wants to hear when thinking about starting a business. All it takes is one person to form a company, but the number of directors and shareholders can be unlimited, there are no restrictions on nationality or residency, and with minimal capital.

The Belize offshore company needs very little time to be registered and made operational considering that the overall process takes two to three working days. The short period of time to set up the company is, however, conditional on compliance with the law.

If the documentation is complete, it will only take a short time for the company to operate. The official language of business is English and all documents required for registration and incorporation must be completed in English.

Privacy protection

Belize is a jurisdiction that guarantees the protection of privacy in business activities, which is an attractive factor in encouraging foreign entrepreneurs to open offshore bank accounts in the country.

According to banking regulations, the names and account details of depositors, in particular, must be safeguarded and kept confidential. Only if there is evidence of criminal investigations or court orders, this information can be disclosed.

At the time of registration, no data is recorded on the company’s beneficiaries, directors and shareholders. The information is known only to the authorised agent, who is bound by law to keep it totally confidential.

Company owners and board members are not required to disclose their identities, there is no obligation to disclose information such as profits, losses and financial transactions of great interest, one of the plus points that attracts many global investments.

No tax on foreign-source income

In Belize, prospective entrepreneurs will be pleased to know that registered international business corporations will be exempt from local corporate income taxation.
The owners of such companies, whether financial or corporate, are excluded from transfer taxation on all types of assets. This is why Belize is known as the most famous tax haven jurisdiction in the world.

Companies will pay a minimal amount of tax, they can set aside a more significant amount of their benefits each year. The amazing fact is that it is legal to reduce taxes by working from an offshore country like Belize.

Opening a bank account

Belize is an international district where you can start the fast-track procedure to open a bank account, whether it is yours or a business account. The initial deposit is quite low, ranging from $500 to several thousand dollars.

Unlike other countries where entrepreneurs have to sit down with the banker to open an account, almost all banks in Belize grant remote registration. Everything can be done through email.

A bank account in Belize can be opened remotely without the presence of the signatory and with a fairly low and balanced deposit to bank.

The documents required to open an offshore account in Belize are as follows:

  • Certified copy of valid passport or document with signature, photo and personal identification
  • Proof of your residential address, such as the original bill of residence
  • A bank reference from a bank with more than 2 years of relationship
  • A bank reference from a professional with 2 years of relationship (lawyer or accountant) or from another bank with more than 2 years

Reducing operating costs

In Belize, the reduction in operating costs makes setting up offshore companies for many people an affordable investment choice but they also need to reduce labour costs.

In Belize, the world’s most popular tax haven that flaunts an enviable business atmosphere, labour costs are low thanks to cheap labour, overheads and real estate. Running a business in Belize is much cheaper than in many different destinations around the world.

Free zones

Government and business leaders have models of innovative strategies aimed at accelerating the already incredible rate of growth. The small Caribbean country in Central America is exploring new opportunities and has a spontaneous competitive advantage thanks to the large North American trade coalition. Belize offers a number of tax-free schemes that can be classified into two types:

Export Processing Zones (EPZ)

Export Processing Zones represent a programme that catalyses both indigenous and foreign investment to increase production, processing, assembly and services for export markets, especially for non-traditional manufacturing and agricultural products.

EPZ exemptions:

Exemptions of EPZs include import and export, as well as capital gains tax, property and land tax, sales and consumption tax, commercial turnover tax, foreign exchange and transfer taxes, etc.

Exemption from the Supply Control Act and its regulations. No restrictions on the import of raw materials. No import or export licence requirements. No trade licence. Customs control in Zone for convenience.

Commercial Free Zones (CFZ)

The CFZ was established to attract foreign investment and combines activities such as manufacturing, processing, packaging, storage and distribution of goods and services. Goods in the CFZ are duty-free at wholesale or retail level. It is used by diplomats from other countries, ships docking in Belizean ports, direct export by land, sea, and air or for entry into the country’s customs territory.

CFZ exemptions:

CFZ duty exemptions cover goods, articles or other goods for commercial purposes such as fuel, construction materials, furniture, equipment and supplies. Exemption from income tax, capital tax, profit tax during the first 10 years of operation. Exemption for the first 25 years of operation on dividends paid by a CFZ company.

No import or export license or restriction on the sale of foreign currency or transfer of foreign currency. No government fees and taxes imposed on the use of foreign currency etc…

Taxes in Belize

The main reason why Belize’s business habitat is considered a true tax haven by many foreign investors is that offshore companies registered here pay no tax on income derived from abroad. Equally tax-free are dividend payments made by offshore companies to non-Belizeans.

Those earning less than US$10,000 are exempt from tax. This is at a rate of 25% on taxable income for all Belizean resident employees earning over BZ$26,000 (US$13,000) per annum. Taxation on business income varies by sector, ranging from a minimum of 0.75% for print and radio to 15% for other sectors such as dividends, royalties, lottery winnings.

Types of companies

In Belize, prospective entrepreneurs will be pleased to know that international business corporations registered in Belize itself, known as IBCsor LLC, will be exempt from local corporate income taxation. The internal corporate records of the IBC such as Register of Members, Register of Directors and Corporate Minutes and Resolutions are all maintained by the Registered Agent and are also confidential.

IBC International Business Company

The IBC is the corporate structure used for international offshore business purposes as it allows corporate investors to earn high returns. The requirements for this type of company are very accommodating, and most of all, this corporate entity is tax free. In recent years, Belize has emerged as one of the growing IBC registries globally with a number of fast track procedures. An IBC in Belize possesses innumerable advantages such as:

  • No minimum paid-up capital
  • No obligation to maintain the company’s books
  • No obligation to appoint directors of Belize
  • No obligation to hold an annual general meeting (AGM)
  • Maximum confidentiality of directors’ and shareholders’ details

This type of International Company of Belize is feasible to develop the following activities:

  • Banking activities
  • Insurance and reinsurance activities
  • Corporate headquarters
  • Business trust
  • Collective investment schemes
  • Fund management

This means that their foreign-sourced income will be tax-free and that there is no capital gains tax in the country, no withholding tax on dividend distributions and IBCs will not be required to make any interest payments.

For all its incredible tax privileges, an IBC incurs a fixed charge to the Government of Belize of $150 per year. The actual cost of the government fee is dependent on the amount and type of authorized capital of the IBC, as follows:

  • For an IBC where some or all of its shares have no par value, the annual fee is $350
  • For an IBC with capital of less than $50,000 the fee is $100 for the first year and $150 from the second year onwards
  • If it exceeds $50,000 with all of its shares having a nominal value, the fee is $1,000

LLC International Limited Liability Companies Act

The LLC, in a nutshell a limited liability company, is one of the most common business forms for entrepreneurs aspiring to form an offshore company in Belize.

It is widely used as compared to other legal entities due to its great protection for the members or owners of the company. This type of company is also considered to be a perfect tax planning and asset protection vehicle for any offshore seeker in Belize. It is of particular importance to note that only persons not resident in the Caribbean country can form the LLC.

It is a hybrid of both a limited liability company and a partnership with partnerships having a number of exceptional features including:

Member’s responsibility No member of the LLC shall be personally liable for any debts or obligations of the company unless a legal agreement exists
Member power Members can enter into contracts, create bank and investment accounts, determine company distributions, etc…
Fiscal optimisation Exemption from all forms of tax, duty and exchange control in Belize
Protection of assets The assets of the limited liability company are also protected on account of a debt of one of its members
Privacy Information about the identity and record of persons on behalf of a Belize LLC is kept confidential
Simplicity and flexibility The LLC does not require the preparation of annual accounts or the appointment of an auditor
Company name registration The name of an LLC in Belize requires a name that is unique and different from other existing company names.

VAT in Belize

Value Added Tax (GST in Belize) is a tax levied on the expenditure of consumers during the commercial transactions of buying and selling goods and services with these reliefs:

Ordinary rate 12,5%
Hotel services 9%

A business that has been in operation for less than 12 months and produces gross sales or revenues of $75,000 or more per year is considered eligible for GST registration. The procedure for general sales tax registration for the applicant is to submit a completed GST application form with complete and correct details to the department.

The person is registered and will be issued a certificate of registration; the department also has the authority to request additional information as needed.

VAT number

VAT registration, which in Belize corresponds to the TIN tax identification number, has recently been largely simplified. Being registered with a TIN number does not mean that the IBC is subject to taxation in Belize. The new requirements demanded by the government administration are as follows:

  • Single registration form for all IBCs
  • Copy of certificate of incorporation of such company if a shareholder represents a foreign company
  • If the shareholder is a Belizean IBC, the previous document is already filed with the Registry
  • Payment of the TIN registration fee.
  • Letter issued by the registry stating that the company is in good standing; this letter replaces the certificate of good standing.

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