Investors starting a business in Grenada as an offshore have the possibility of registering an International Business Company (IBC). This type of company can be incorporated as a limited liability company, following the national rules. The main difference between a resident limited liability company and the IBC is that the latter can only engage in economic activities originating outside Grenada.
Our consultants in company formation in Grenada can offer the necessary advice on the local legislation, the rights and obligations of foreign investors, assistance in the incorporation process and many more.
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The characteristics of an IBC in Grenada
Investors who will open a company in Grenada as an IBC must know that this structure is characterized by the following:
- the IBC can benefit from tax exemptions in Grenada for a period of 20 years;
- it is entitled to a 0% tax rate on the corporate income tax, the capital gains tax, the withholding tax, wealth tax and inheritance tax;
- the process of company incorporation in Grenada can be completed by 1 shareholder;
- the company must have 1 director, who can be the company’s shareholder, even in the case in which the legal entity is incorporated only 1 shareholder (thus, the investor can have full control over the company).
Investors who will set up a company in Grenada through an offshore will, as such, be exempt from paying taxes such as the corporate income tax, charged at a rate of 30%, or the valued added tax, charged at rates ranging from 0% to 20%.
Income tax is also imposed on the income obtained by individuals working or obtaining taxable revenue in Granada (the tax is imposed to income above $60,000, according to the Ministry of Finance). Foreign investors operating through an offshore are exempt from paying this tax.
Why opt for offshore company formation in Grenada?
Our consultants recommend investors select this jurisdiction not only due to the tax exemptions granted for a very long period of time (2 decades), but also because the country provides a high confidentiality level and no exchange control policies.
Confidentiality is assured in the sense that the names of the shareholders and the directors are not publicly displayed. We also recommend Grenada for offshore company setup because it has minimal accounting obligations.
While other offshore jurisdictions require offshore companies to submit annual financial returns, this is not the case in Grenada, as companies are exempt from this obligation. However, there are basic accounting obligations that must be respected, such as maintaining the company’s accounts.
What are the financial obligations of an IBC in Grenada?
Although the IBC is exempt from paying taxes here, it must be noted that starting a business in Grenada implies certain financial obligations, which appear in the form of various fees. For instance, upon the registration of a legal entity, investors must pay registration fees.
The fees are charged not only for the registration of the business, but also for each year of activity the company has (imposed as an annual renewal fee). These are paid to the Grenada Corporate Affairs and Intellectual Property Office.
Of course, you can rely on our team of specialists in company formation in Grenada for the payment of any registration or renewal fee, as well as for any other obligation your business may have throughout its years of activity. We also invite you to contact us if you need legal representation for the setup of an offshore bank account for personal or business purposes.