Cayman Islands Company Incorporation
Offshore Company Formation
Company incorporation Singapore may be the top choice for foreign entrepreneurs who are looking to do business in Singapore, but offshore company formation is another aspect that investors tend to look into. Cayman Islands for example, is a popular offshore company choice when it comes to tax havens, and here is why.
Why go to the Cayman Islands?
Cayman Islands is a well-known tax haven for business activities with a jurisdiction that compromises of three different islands. These islands are: Little Cayman, Cayman Brac, and Grand Cayman. It lies on the geographic Western Caribbean Zone and is located south of Cuba and northwest of Jamaica. With a population of less than 50,000 people, the island has one of the largest GDP per capita ranking at position 14th worldwide. When it comes to governance issues, it falls within the British Overseas Territories.
However, the government in charge does not charge any direct taxes. This means that taxes such as income tax, capital gains tax, inheritance tax, and so on are non-existent. This is what has caused the country to be a well-known as safe tax haven.
Requirements of Forming a Company
Cayman island is one of the most respected tax neutral jurisdictions. Since the territories fall within the British territories, the general laws that cover the business environment derive much of their spirit from the English law. In addition to this, there are plenty of highly qualified lawyers, tax consultants, and agencies from all over the world who work in Cayman island and offer different related services. In opening and starting an offshore company in Cayman Islands, one is required to fulfil several requirements.
These requirements are very simple and if one can fulfil them, one will receive one’s license.
The name of at least one director: The director can either be an individual or can be a corporate entity.
The name of at least one shareholder: Just like the director, a shareholder can either be an individual or a corporate entity. The director can also double up as the shareholder.
Company Secretary: The company secretary is in charge of handling the legal affairs of the company.
Minimum share capital: The minimum share capital of an offshore company to be established in Cayman Islands is USD 50,000 To register a company you will also be required to submit the name of the company.
The name of the company must come with certain words such as limited or incorporated. Once you have submitted this information, you will be able to receive the full registration of corporation within five to six days.
In declaring your profits, the company law is not required to submit its financial accounts such as the profit and loss account, the balance sheet or even the cash flow statement. All that is needed is for the company to declare the profits. Cayman Islands is also very tight on privacy and secrecy. This means that even though one is required to submit the name of the shareholder and the director, to the Registrar of companies, this information is not available to the public.
Types of company that can be formed in the Cayman Islands
1. The Nonresident Company
A non–resident company is not expected and is not allowed by law to conduct any business within the jurisdiction of Cayman Islands. A company applying for the status of a non–resident company must prove that the company will not engage in business within the jurisdiction. This will cause the state’s financial secretary to grant the certificates of non–resident which will cause the company to be relieved some of the licensing requirements that deal with the local companies‘ control. However, the law demands that one shareholder’s meeting must be held in the Cayman Islands, but you can appoint a proxy. This law allows only non–resident of Cayman to operate such a company. Once this is done the company will not do business with any person or any business inside Cayman Islands.
2. Tax Exempted Company
The other category of offshore companies that can operate in Cayman islands is an exempted company. An exempted company has the following features:
- It doesn’t need to have one annual meeting in Cayman Islands
- It is required to hold one director meeting every year in Cayman Islands. However, many times companies use proxies.
- A company registered under this category does not need to use the name limited
- Such a company does not need to keep a list of the annual shareholders