Registration of Company in Belize

Registration of companies in Belize

Belize, a small Caribbean state, is located in Central America. In the north, Belize borders on Mexico, in the west - on Guatemala, and its eastern borders are washed by the Caribbean Sea.

The country is a constitutional monarchy and part of the British Commonwealth of Nations. Belize has a parliament that is re-elected every five years, and its executive power is in the hands of the prime minister.

The official language in Belize is English, but Belizean Creole and Spanish (at least 2/3 of the country's population speaks them) and local dialects of Mayan tribes (up to 10% of the population) are the most spoken among the local population. The ethnic composition of the population is also quite diverse. It includes Belizean mestizos (descendants of the local population and the Hispanic), Creoles, black people, Mayan tribes, Europeans and Asians.

The country's area is 22,966 sq.km, the population is about 390 thousand people (as estimated in 2019). The country’s capital is Belmopan with the population of 13.8 thousand people. Almost half of country’s population (about 48%) lives off the coast of the Caribbean Sea.

A significant part of the country's territory is occupied by a lowland, sometime swampy, plain with many lakes and lagoons. In the south, the Mayan mountains stretch up to 1,122 m. The country's climate is tropical trade-wind. Despite the rainy season from May to July, the tourism and investments are the main types of funding the country's budget.

The company registration in Belize requires a professional legal approach. Law & Trust experts provide a package of services on collecting documents, representing a client, and also provide free initial consulting.

When registering business in Belize, you need to know many details of local jurisdiction, and the first thing you should pay attention to is the local taxation.

Why it is profitable to register offshore company in Belize?

The attractiveness of Belize as the offshore territory primarily includes the high reliability and reputation of this jurisdiction. Belize is one of the most popular offshore territories and attracts international business owners from all over the world.

Benefits of opening a company in Belize:

Main:

1. High confidentiality;
2. Closed register;
3. Zero tax burden;
4. Speed of company opening (with quick registration, you can open it within 24 hours);
5. No annual financial and tax reports are required, no audits are conducted.

Additional:

1. Ability to purchase a ready-made solution in Belize remotely;
2. Affordability of prices for registering, purchasing and servicing the company;
3. The final beneficiary’s data are hidden in the public domain;
4. The presence of special legislation on trusts allows you to protect your assets;
5. Belize has an inherent high level of democracy and stability.

Offshore companies in Belize: tax rate levels

If the company is not resident, it is totally exempt from VAT, except for a fixed annual fee and local taxes. The tax rate for international business companies is as follows:

• 1.75% of taxable income for the amount exceeding USD 1.5 million;
• 3% of taxable income for the amount less than USD 1.5 million.

Corporate tax rates range from 1.75% to 19%, depending on the business type. For example, most businesses pay 1.75% of the income tax rate; they pay 6% for professional business services.

A resident company is obliged to pay the state 25% of the company's financial turnover, while the level of business profitability does not matter. The amount of the annual fee for offshore companies in Belize depends on the size of previously declared authorized capital, the rates are fixed and have the following values:

1. With the capital amount up to USD 50,000, the fixed fee to country's budget is USD 100 per year;
2. With the capital amount of USD 50,000 and more, the fixed tax to state treasury is USD 1,000 per year;
3. If a company issues shares without specifying par value, it is obliged to transfer USD 350 annually to the local state treasury;

It must be paid by January 31 of the year following the billing period. Otherwise, the company is blacklisted.

IBC companies, registered before October 16, 2017, inclusive, remain exempt from taxes until June 30, 2021. IBC companies are taxed in Belize only if the company is physically present in Belize.

Changes in Companies’ Operation in Belize in 2019

Based on the change of rules for the new regime of international business companies, which came into force on January 1, 2019, the new rules of business conduct now apply to IBC organizations in Belize. Now, Belizean IBCs are entitled to:

• Purchase real estate or take share in real estate in Belize;
• Hold shares in any company of the state (whether local or international company);
• Run business with Belize residents;
• Open and manage a bank account with local banks in Belize (in local currency);
• Make direct investments and trade in Belize.

IBC companies, which are licensed to trade in securities, Forex, brokerage services are obliged to have a physical presence in Belize. This requirement had to be met by the end of 2019.

IBCs, which will decide to be physically present in Belize, are now considered as state residents and are taxed under the Belize tax regime. The companies, which will decide to remain beyond the state and carry out their main activities with income beyond Belize, will not be considered as the country’s residents and are not subject to income tax.

IBC companies can obtain the Certificate of Good Standing (CGS) provided the annual fee is paid, and can also apply for a Tax Identification Number (TIN), which entitles them to file annual tax returns along with nonconsolidated financial statements. The accounting rules established by Accounting Records Maintenance Act 2013 remain in effect.

The companies with the annual income of USD 6 million, with the income of at least USD 250 thousand, operating in the technical zone of Belize, can be audited by the Authorized Person of the Belize Tax Commission, as well as be audited based on the total income, assets and employees. The following companies also fall under supervision of tax authorities:

• Are registered persons on the stock exchange;
• Restructure, liquidate or sell all assets that go through the auction;
• Perform activities regulated by IFSC;
• Carry out activities that require the preparation of consolidated financial statements.

IBC companies registered before October 16, 2017 remain exempt from taxes until June 30, 2021 and receive a Tax Exemption Certificate. The companies registered after October 17, 2017 that require a Tax Certificate must prove that:

1. The company does not have a physical presence in Belize;
2. Its main activities, which generate income and are carried out in a country with applicable taxes, are in accordance with the Belize Income and Business Tax Act;
3. There are the documents confirming the payment of IBC tax rate.

All Belize IBCs are required to keep updated registers of directors, shareholders and ultimate beneficiaries (duly signed by the director) at the company's registered address.

Company registration in Belize: conditions and regulations

1. From 2019, Belize offshore zone implies the creation of companies with IBC and LTD legal form. The most common form is IBC (International Business Company). The companies registered in Belize may have such endings: Ltd, Limited, Inc., Incorporated, Corp., Corporation, Societe Anonyme or Sosiedad Anonima. The company name must be unique and single in its form;
2. After registering a company in Belize, the client can count on the highest level of confidentiality. The state does not have any open register of entrepreneurs; all data on directors and founders is not available to the general public. After the procedure of company registration in Belize, the client will still need to go through KYC verification to confirm the identity, despite the fact that Belize is a very protected jurisdiction;
3. When registering an offshore company in Belize, it is important to take into account its scope of activity: legal, transport, banking, insurance and other areas require an additional profile license. There is a high demand for FOREX licenses, brokerage instruments, trading in financial and other financial derivatives, credit and pledge operations, currency exchange, etc. A fixed fee for license renewal must be paid annually;
4. The non-resident company registered within the country’s territory has the right to own real estate, buy land and make transactions with state residents. However, the non-resident company cannot benefit from real estate in Belize, other than lease for business purposes, cannot provide legal addresses to other IBCs;
5. The authorized capital in Belize is declared, but there are no requirements for its mandatory payment. The standard level is USD 50,000. One may issue registered shares, as well as for a representative, which can be with or without voting rights, as well as shares with and without par value. It Is enough to issue one share for opening a company in Belize. This amount of authorized capital is usually required for any offshore company in the world. The contribution can be made using any currency. There is the option to register a company without authorized capital;
6. IBCs in Belize are not obliged to file financial statements. Only those records are kept that are necessary for transactions. Any reports and records should not be stored on the territory of Belize, the owners can choose the place. The Belize legislation provides for mandatory maintenance of accounting records.

Requirements for opening a company

Company Structure:

Director: the minimum number is one; can be both an individual and a legal entity. There are no residency requirements. Information about company’s directors is not publicly available.

Shareholders: the minimum number is one; can be both an individual and a legal entity; information is not publicly available. There are no residency requirements.

Secretary: Not required by law. The mandatory presence of a secretary was removed, as Belize is trying to get rid of unnecessary number of individuals to simplify the conduct of business.

One must have a real legal address and a registered agent in Belize.

Documents required for company registration:

Documents from individuals:

• Copy of passport or other national identity document;
• Copies of the documents confirming citizenship and residence address.

Documents from legal entities:

• Copy of the Certificate of Incorporation;
• Copies of incorporation documents (Articles of Association and Memorandum of Association).

The company of talented lawyers “Law and Trust” will help you register your company in Belize as quickly as possible and on better terms. For more details, please call us by:+44 (20) 37693394 (London).