Most foreigners forming companies in Turks & Caicos Islands are interested in the location as a renowned offshore destination.
Those who opt to start the process of company formation in Turks & Caicos Islands for offshore purposes must know that the islands are an attractive offshore financial center. Offshores located here can be managed by incorporating an International Business Company (IBC), a type of company designed to fit the needs of offshore investors.
Our specialists can help businessmen in setting up an IBC; we can also assist in the process of company incorporation in Turks & Caicos Islands for onshore businesses, therefore we invite you to address us for personalized assistance.
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What are the characteristics of the IBC?
The IBC is a common way to start the process of offshore company formation in numerous offshore jurisdictions. In general, regardless of the country of incorporation, the IBC refers to an offshore company that benefits from tax exemptions in the country where it is incorporated, and which offers privacy and asset protection to its founders.
It also entails the fact that its shareholders are foreigners who are not residents of the country where the IBC is incorporated. These are some of the basic traits of the structure and, from one country to another, the entity may have different requirements in terms of minimum shareholding, capital, etc.
In the case of foreign businessmen who want to open a company in Turks & Caicos Islands as an IBC, the following apply:
- the manner in which one can set up a company in Turks & Caicos Islands as an IBC is regulated by the Turks & Caicos Companies Ordinance 1981 (the law was amended in 2014);
- the IBC can be incorporated by only 1 shareholder (natural person or another legal entity);
- it allows 100% foreign ownership;
- it is also required to appoint at least 1 director (there aren’t any residency obligations);
- although there aren’t any minimum capital requirements, it is recommended that the IBC should have an authorized share capital of US $5,000.
What policies apply concerning the activity of an IBC?
The main rule concerning the activity of an IBC in Turks & Caicos is that the company can’t engage in business operations within the borders of Turks & Caicos (the basic definition of offshore company setup is that a legal entity is incorporated in a jurisdiction, but it engages in business with clients, partners and markets overseas).
Besides this fact, the law in Turks & Caicos states that the IBC is not allowed to register as a business providing any of the following: banking, insurance, reinsurance, assurance services.
What are the tax benefits of an IBC in Turks & Caicos?
It is recommended to start the procedure of company formation in Turks & Caicos for an offshore company due to the numerous tax advantages investors can obtain. Typically, an offshore benefits from a variety of tax exemptions in Turks & Caicos; the IBC is exempt from the payment of the following:
- the corporate tax;
- the capital gains tax;
- the inheritance tax;
- the stamp duty;
- the municipal tax.
Additionally, local authorities do not require IBCs to submit their annual tax returns, nor to complete audit formalties, as it can be the case of onshore businesses.
We invite you to address our team for further information on the requirements imposed when setting up an IBC (documentation, registered office, registered agent, etc.). You can always rely on us for professional services on company formation in Turks & Caicos and we also invite you to address us if you want to set up an offshore bank account for business or personal purposes.