Offshore Companies, IBC’s, Local Belize Companies and Trusts

Doing Business in Belize

Con Murphy

 

•  Stable Government •  English Speaking •  Time Zones similar •  Proximity – Flights

 

Why do business or protect my assets in Belize?

Common Law

• Confidential Jurisdiction - Foreign Judgements are not enforced - Loser Pays - No Class Action Law Suits - Torts are very uncommon

Many ways to conduct Business in Belize and Offshore  

• Sole Proprietor – Unlimited exposure • Local 250 Companies – Limited Liability but no confidentiality. • Offshore Company -International Business Company - International Limited Liability Company • Trusts • Foundations

History of Offshore in Belize  

•  1989, Merchant Ships Act (IMMARBE). •  1990, International Business Companies Act based on the British

Virgin Islands model. •  1992 Trusts Act which provides for both onshore and offshore trusts. •  1996 Offshore Banking Act. •  2010 Foundations •  2011 International LLC’s

Benefits of using a company?  

• Limited Liability • Asset Protection • Anonymity: in many cases •  Jurisdictions • Transferability of shares •  Indefinite life of the entity

International LLC  

•  A hybrid between a limited liability company and a partnership, •  Tax mitigation or control vehicle •  Suitable for use in conjunction with Self Directed IRA’s •  Allows for offshore bank accounts •  One Member can incorporate •  Exempt from all local taxes •  Only judgments delivered by a court in Belize are enforceable against a LLC or any of its

managers or members •  Members can fully participate in the management of the LLC •  No accounting/audit requirements •  International Trade (except in Belize) •  Hold assets/ship ownership •  Hold IBCs, Trusts and Foundations

International Business Company (IBC)  

Advantages of a Belize IBC • Tax Free in Belize • English Common Law • Registration in any Language • Competitive Registry Fees • Do business and hold property outside of Belize • Must have a manager and registered office in Belize. • Board Meetings can be held anywhere in the world. • Shareholders names not held by the IBC registry.

Special Licensed IBCs  

•  Formation or management of international business companies or other offshore entities •  Formation or management of international trusts and the provision of international trustee services •  International insurance services •  International asset protection and management •  International collective investment schemes (such as mutual funds, unit trusts, etc.) •  Money transmission services •  Payment processing services •  Trading in foreign exchange •  Trading in financial and commodity-based derivative instruments and other securities •  Money brokering •  Money lending and pawning or exchange •  Safe custody services •  Accounting services

Restrictions of an IBC  

• An IBC cannot carry on business with residents in Belize • An IBC cannot own real interest in real property situate in Belize • An IBC cannot hold share, stock, debt obligation or other securities in

a local company • An IBC cannot issue shares , stock, debt obligation or other securities

to any person in Belize or any local company

Other advantages of IBC’s

•  If you do some work for your IBC you can mitigate your annual tax through the Foreign Earned Income Tax credit. • You can choose when you realize and repatriate the profits of your

business and therefore control when you pay the tax on it.

Local 250 Company  

• Public Record – No anonymity • Liability mitigation • Very useful for operating within Belize • Annual Filing – foreign shareholders must be registered with the

Central Bank • Local Government agencies and businesses are familiar with them.

Trusts  

• Acknowledged as one of the best in existence. • Legally binding agreement between grantor and grantee. • You can control the assets but not own them. • You can’t be sued for the assets. • Effective immediately, no claw back period.

Foundations  

• Mix between a trust and a charity • Legal entity • Tax Exempt • Ran by a council rather than a Board of Directors • All donations are property of the foundation, not the grantor or their

heirs. • Not as useful as an intergenerational asset protection vehicle like a

trust.

Offshore Banks  

• Possible for qualifying persons to incorporate Class A or Class B Offshore Banks. • This provides for two categories of offshore banking licenses – the

Unrestricted “A” Class and the Restricted “B” Class license. • The holder of a “B” Class license maintains lesser capital and is

restricted to conducting certain limited business activities only. • All banks in Belize are now FATCA compliant. • Licencing requirements tightening.  

Banking in Belize  

• Domestic or Foreign Currency Accounts available. • Domestic BZ$ Accounts for paying local expenses. • Usually US$ but CAN, GBP, EURO and CHF accounts available • BZ$ : US$ = 2: 1 • Very High Liquidity Rates 24% • No Bank failures • Foreign currency conversion restrictions

Coming to Belize  

• Visas • Tourist Visa 30 days • Work Permit 1 Year • Qualified Retired Persons Residency Visa (QRP): Annual Renewal • Permanent Residency - Forever • Citizenship – Forever and voting rights

How to open a business in Belize  

•  Incorporate a local entity & get a business checking account. •  Talk to Beltraide for assistance or even duty exemptions. • Get any necessary licenses. •  Register for business tax. •  Register for social security of you have employees. •  Be aware of the GST Treshold •  Pay for a trade license if you are in a town or city. •  Consider Trade Mark registration with Belipo. •  If you business will be operating internationally seek advice on a suitable

offshore structure to hold foreign currency bank accounts and for additional protection.

Taxes in Belize

•  Income Tax : 25% on all income earnings over $10,000 • Property Tax: 1% on the unimproved value of the land. • Stamp Duty: Property Transfer Tax: 5% • Capital Gains Tax: Zero • Business Tax 1 – 40% depending on industry. Usually v low. • Custom Duty: Varies but is a main source of revenue. • Sales Tax: GST 12.5%

CJM International Corporate Services  -­‐  Currently  Offer  Local  Corporate  Services  at  a  reasonable  rate.  We  don’t  charge  high  Lawyer  Fees  

-­‐  Local  Company  forma@ons  &  renewals  -­‐  QRP  and  Work  Permit  Processing  Assistance  -­‐  Land  Title  Research  and  Transfers  -­‐  Business  Consul@ng    -­‐  Business  Administra@on;  Including  -­‐             Paying  your  land  Taxes  -­‐             Payroll  Administra@on  &  local  tax  handling  

-­‐  Currently  applica/on  being  processed  to  be  a  licensed  offshore  provider:  Expected  comple/on  20th  February  

-­‐  Conference  Discount:  15%  discount  on  our  already  favourable  rates.