British Virgin Islands

The British Virgin Islands include over 50 small Caribbean islands. The BVIs are one of the most famous tax havens, but nowadays they can no longer provide a very high level of anonymity.

The capital of the BVI: Road Town

Official language of the BVI: English

Currency of the BVI: US Dollar (USD)

Attention – British Virgin Islands law update for 2024 to read here. 

BVI Company Description and Benefits

• The legal form of an offshore company is called an IBC – International Business Company
• the possibility of issuing shares to owners in certificated form, these must be held in custody by the registrar and may not leave the BVI
• an IBC in the BVI may not carry on business or trade with BVI residents or own
• offshore companies in the BVI pay no income tax
• the minimum number of managing directors is 1, the managing director may be a non-resident individual or a legal entity
• the share capital can be of any amount and does not have to be fully paid up
• non-public register – the register of directors and the register of shareholders is kept by the registrar and is therefore not publicly accessible

International treaties

International conventions against money laundering and terrorist financing

The BVI has signed these treaties. The practical significance of these agreements for owners of offshore companies from the British Virgin Islands is mainly that in the event that money laundering or terrorist financing is suspected by a BVI offshore company, its registration agent can pass on the personal details of the persons involved in the company and a basic description of its activities to its superior authorities, who will pass them on as part of international assistance, e.g. to the Czech Republic.

Double taxation treaty with the Czech Republic

Not concluded. Withholding taxes apply on direct payments from the Czech Republic to the BVI. BVI 

Not suitable for direct sales of goods or services to the Czech Republic.

Tax Information Exchange Treaty with the Czech Republic

It is concluded. There is a bilateral exchange of information.

Council of Europe Multilateral Convention on Mutual Administrative Assistance in Tax Matters

Not concluded.

Common uses of BVI companies

• Holding company, parent company, other companies for anonymity of ownership

• Direct sale of goods or services where there is no need to use the double tax treaty system and there is no risk of withholding taxes

Advantages:

• exemption from all local taxes and stamp duty
• no disclosure of company personnel required
• no reporting requirements
• no accounting requirements
• maximum security of assets
• maximum confidentiality and anonymity of owners
• stable jurisdiction with a very good reputation
• modern offshore legislation
• BVI-based companies are exempt from local taxes, are allowed to conduct all types of business and can have clients, suppliers and employees from any country

The BVI is a British Crown Territory, thus politically stable, democratic and more prosperous than most other Caribbean countries.

Taxes

The BVI is arguably the most reputable offshore tax haven in the world. Since 1984, the BVI International Business Company (IBC) has reached the pinnacle of popularity among the world’s offshore companies.

The legal and judicial system of the BVI is based on English common law with national legislation enacted by the BVI Legislative Council.

The BVI is responsible for the islands’ defence, foreign affairs, internal security and the administration of justice.

The BVI has a tax system more characteristic of a modern tax haven.

Corporate or personal income tax has been abolished, and there is no capital gains tax.

The government makes its budget from payroll taxes (10% for small businesses and 14% for all others), as well as import duties and stamps, licensing fees, and business registration fees.

The offshore financial sector contributes substantially to the BVI budget

Bearer shares

The law requires all bearer shares to be “immobilised”, meaning that the shares must remain licensed with the Depository, together with a written indication of the true identity and address of the holders of those shares.

Therefore, the main advantage of bearer shares, namely the ability to transfer ownership of shares quickly and anonymously, is effectively lost.

Other features

In addition to being virtually tax-free while legally qualifying as a domestic entity, the new BVI corporation has several other notable features. It does not have to disclose the monetary value of its share capital.

There is no statutory requirement to file directors’ or shareholders’ details with the Registrar of Companies – but the company can choose to do so.

There is no need to file any financial reports or accounts.

Types of company

• Limited, LTD
• Corporation, CORP
• Incorporated, INC
• Socite Anonyme, S.A.
• BVI Bank Account

BVI Bank account

We are also able to assist you with opening a BVI bank account for your company.

News for 2024 – report on the company’s financial assets (assets / liabilities)

Introduction of an annual report on the company’s financial assets, starting in 2024: Since 2024, the BVI Companies Act has been amended so that local companies are now required to report annually on their financial assets in the form of a prescribed report. 

Exceptions from the obligation:

• publicly traded companies
• entities regulated by BI FSC (Financial Services Commission)
• companies that have already filed their annual BVI Inland revenue report
• companies that start the liquidation process before the deadline for filling the firs report

Timeframe for submission: The company has a period of 9 months from the end of the fiscal year. Failure to meet the deadline can expose the company to heavy fines. In addition to the fines, the company also loses the ability to order an extract from the BVI Registry of Companies and other services from the BVI Government. 

Audited reports on financial assets: Although an audit of financial reports is not necessary, there may be situations where it will be required by government authority. In such a case, the audit must be prepared and submitted to the state authorities for review. 

Change of fiscal year

Among other things, the law now gives the option to choose a different period of the fiscal year than the standard January – December period. We recommend that you consider aligning the fiscal year with the company’s renewal date for ease of review.

Efficiency

The above ligislation and related obligations are effective and enforceable by the State from 1 January 2024.