The Cayman Islands provide a highly regulated, internationally acknowledged, tax-neutral offshore business climate which is dynamic and responsive, with more than 90,000 active companies being registered in this jurisdiction.
The Islands were one of the traditional offshore jurisdictions alongside Bermuda and it is their longstanding tradition that continues to make them attractive to foreign investors worldwide.
The fact that they were once part of the British Empire means that the current legal system is based on the English Common Law – another advantage for foreign investors.
Requirements for legal entities in the Cayman Islands
A company in the Cayman Islands can be set up as an Exempted Company or as a Non-Resident exempted Company. The first business form tends to have a higher degree of popularity among foreign entrepreneurs because of its tax-exempt status.
Shelf companies or readymade companies are available for those foreign investors who wish to purchase a company that has already been incorporated.
The company can select a name that is either in English or in Chinese and the minimum share capital upon incorporation is 50,000 USD. There are no restrictions on the nationality of the company founders and shareholder and directors can be either individuals or other corporations. Annual fees or registration will apply, although they are not burdensome for investors.
A requirement for opening a company in the Cayman Islands is to have a registered office and a registered agent. These two can be included in the special company formation packages offered by companies that provide incorporation services.
Advantages of setting up a company in the Cayman Islands
Setting up a Cayman Islands company has numerous advantages, among which we mention:
•Minimized international taxation: When appropriately structured, a company which is set up here can legally attain international income and minimize international taxation;
•Easy and simple company incorporation: investors need to submit the company’s constitutive documents along with the approved company name, types of shares, authorized capital and registered office address with the Registrar of Companies.
•Light reporting requirements for companies: There are no annual requirements for annual audits or complex accounting procedures. The only requirement is to file an annual return.
•Minimum company management requirements: Cayman Islands company incorporation is possible with only one shareholder and one director. The shareholder and director can be the same individual or a legal entity, and the company can be owned 100% by a foreign citizen;
•Tax-free jurisdiction: There is a complete lack of direct taxation which can be sustained by a 20-year government guarantee against the taxation introduction. To obtain this guarantee, the business owner has to apply for a tax exemption certificate. This implies that there are no corporate taxes, no capital gains taxes, no payroll taxation, no real estate taxes and no withholding taxes. It is important to note, though, that the tax exemption certificate is only available for exempted businesses;
•Easy management: After the Cayman Islands exempted company registration the business can be managed from any country outside of the Islands.
The Cayman Islands not only provide a tax-free business environment and very low corporate maintenance requirements but they also offer a high degree of investor protection. This is possible because there are no mandatory requirements to disclose the identities of the company shareholders and directors.
The Cayman Islands exempted company is a business structure with many advantages for foreign investors looking to open an offshore company that is 100% foreign owned and not liable to taxation.
George Town offers a fast incorporation process, privacy and flexibility to investors who choose to open a company here.
If you have further questions about the Cayman Islands company incorporation procedures, please do not hesitate to contact our staff.
Call us now at +44 203 287 0408 to set up an appointment with our lawyers in George Town. Alternatively you can incorporate your company without traveling to Cayman Islands.
As a BridgeWest client, you will benefit from the joint expertize of local lawyers and international consultants. Together we will be able to offer you the specialized help you require for your business start-up in Cayman Islands.