The British Virgin Islands are one of the Caribbean Sea’s hidden gems and a fantastic paradise for any investor.

When you think of offshore, low-tax paradises in the Caribbean, the first thing that comes to mind is the Cayman Islands. But a more discreet and equally special investor’s paradise is the British Virgin Islands. 

This Caribbean gem has forged up its fame for being an ideal land for hundreds of thousands of investors who, on top of generating great income, often enjoy some of the finest beaches on earth.

Located just east of Puerto Rico, this territory belonging to the United Kingdom comprises 50 islands, cays, and volcanic formations in an area that reaches 59 square miles, each one of them imprinted with unparalleled Caribbean beauty. 

Home to world-renowned sailing festivals, this marvelous archipelago of virgin islets is breathtaking.

Within such Caribbean beauty, the BVI is investment heaven. If you ask a financial expert about the ideal place to build a company, the response likely will be these islands. They offer friendly tax legislation, confidentiality laws protecting operations, and little to no delaying bureaucracy processes. 

Knowing how the BVI works, there’s virtually no chance someone can find a better environment for doing business.

-Home of offshore companies: You might know offshore companies are sometimes called “BVIs”. It’s no surprise the term comes from these islands and their ability to attract foreign investment. The BVI has settled legislation that suits businesses to invest and generate wealth.

-Tax exemptions: A unique quality of BVI is its incredible taxation system that allows companies to keep most, if not all, their earnings. Heaven for investors and finance enthusiasts.

-Confidentiality policy: There’s no way companies are treated with greater secrecy than in the BVI. All lawful companies can rest assured that their information regarding operations will be safer there than anywhere else in the world.

-Politically stable: Being a parliamentary democracy, the BVI has a remarkable institutional equilibrium that grants all the citizens and investors a veil of confidence and stability.

-Overall amazing services: The BVI’s living conditions are comparable with those of developed countries in Western Europe. Little to no mortality, great infrastructure, and permanent functionality of basic public services assure well-being for most of its inhabitants.

-Strong banking reputation: The BVI are regarded as a model on banking and with great reason. All of their local banks have a great international reputation for being the most reliable options in the region and the world.

-Caribbean paradise: With some of the most appealing coasts in all of the Caribbean Sea, the BVI isn’t just the dream of investors but thousands of vacationers worldwide.

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A Glimpse of History

Initially discovered by one of Columbus’ expeditions, these islands weren’t properly settled until 1648 by the Dutch, which explains the “virginity” of the archipelago. A couple of decades later, the British fought the Dutch to gain control over Tortola, Anegada, and Virgin Gorda, currently the three most important islands. 

Since then, the United Kingdom has had control over the area and has converted it into one of the Caribbean regions’ greatest economies. The goal was to make it one of the world’s most attractive financial centers by relaxing tax policy and eliminating bureaucratic threats. Undoubtedly, they succeeded.

Its capital, Road Town, is located on Tortola’s island and is the largest and most populated of all, with 21.5 square miles of extension and about 25,000 inhabitants. This city has excellent climate conditions with virtually no variations throughout the year, making it a perfect vacation destination.

In addition, the islands of Anegada (15.2 square miles), Virgin Gorda (8.5 square miles), and Jost Van Dyke (3.2 square miles), each of them with incredible beach landscapes, provide the BVI with an immense tourist value. Each year, these islands are becoming more popular among travelers and investors. And if you keep reading, you will understand all the hype.

The Caribbean Gem 

Tourism is a fundamental part of this overseas territory’s economy since all the businesses related to this area account for 45% of the total GDP. It is common for the islands to receive hundreds of cruise ships a year, and one of them even hosts a world-renowned Sailing Festival: the BVI Spring Regatta. The success of tourism catapults the BVI as one of the most prosperous regional economies. 

That success has its reasons to be. This nation’s growth and development have been exponential, not just for investors but all its inhabitants. In 2016, the National Health Insurance System was conformed, which gave way to a universal national coverage to the health system and considerably reduced the inhabitants’ mortality rate.

These islands have one of the lowest crime rates in the entire Caribbean region, as the World Health Organization has reported as little as 2 homicides per 100,000 habitants. This can be explained due to the low rate of inequality present in the territory, as it ranks in the lowest quartile of any member of the Organization of Eastern Caribbean States.

On top of that, the overall quality of services is remarkable compared to the nearby nations. The transport system has also contributed to BVI’s popularity growth, as more than 70 miles of highways are available for drivers, and most of the airports have been equipped with state-of-the-art technology.

And the good news doesn’t stop there, as their finances are as great as their health, security, and general services. It is no coincidence that the gross national income per capita is around $50,000, making it one of the world’s best considering its small size and total population.

BVI’s Financial Services: a World-Known Model of Success

The key aspect of BVI's prosperity lies in its financial services, which are world-renowned for being friendly to all who engage in business within the islands. About half of the BVI's total revenue comes from this area, mostly generated through offshore companies’ licenses.

It is estimated that more than 45% of the existing offshore companies are accredited in the BVI territory, one of the most recognized being the Citgo Investment Fund. This privately managed fund was founded in 1948 and currently manages over $1 trillion in investor capital, making it the largest managed fund on the planet.

So, what exactly is it that generates so much investor interest in the BVI shores?

Why so many companies choose it as a destination for their investments and why has it been so successful?

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What Makes the BVI an Attractive Investment Location?

Contextualizing the general advantages, we can begin by highlighting that these islands exist under the United Kingdom’s territorial jurisdiction, which imbues them with fundamental political stability when it comes to locating capital. It is not news that the British authorities have successfully set out to develop their colonies as attractive financial centers for investment.

Secondly, its labor force is highly skilled and diverse. Only 37% of its population is native to the islands, meaning there’s great professional migration due to the territory’s economic prosperity. There is an ideal labor and investment climate due to the excellent service providers located in the islands. This also provides the BVI with an immense cultural diversity that fuels business and innovation as a whole.

The legal system present in the BVI is also conducive to capital investment, as the British common law is ideal for the promotion of business and financial innovation. 

Two central principles govern this system. On the one hand, the minimum possible state regulation that allows the free flow of capital. Secondly, and most famously, tax exemption for offshore companies.

This modern financial system is productively exploited by the local banking system, as it is open to receive foreign capital without the hindrance of the processes typically required in most countries. This has allowed an immense variety of businesses to enter the BVI banking system, from the administration of commercial services to the ownership and commercialization of real estate or investment products in general.

This methodology has generated an increasing inclusion of British and international capital in investment funds operating in the islands. And boy, it has worked out perfectly for many of them! By paying a significantly lower amount of tax compared to other systems, most of these funds can bring huge returns to their investors. 

The only question would be: How could this attractive tax system not be a dream for any investor?

Tax Advantages of Offshore Companies in the British Virgin Islands 

We have commented on the tax system that benefits investors so much, but how exactly does it work? Well, basically there are no taxes. This implies that there are none of the following taxes:

-Income tax

-Taxes on dividends

-Taxes on income

-Inheritance tax

-Donations tax

Additionally, non-residents in the BVI do not pay taxes on capital gains derived from the sale of shares or corporate assets, and there are no foreign exchange restrictions, levies, or taxation.

It is important to note that all company registration processes are quite simple and quick regardless of their nature. The creation of a company only requires a few minimum requirements that include the presence of a general director and shareholder (who can even be the same person). 

Among the few requirements you need to incorporate a company in the BVI are:

-General director and shareholder

-Unique name

-Having an address and corporate seal of the islands. This can be provided by the person in charge of incorporating the company in the territory.

Receiving a Certificate of Incorporation in the BVI can take as little as 24 hours, making it the fastest procedure in the world for registering a company. In addition to the low number of requirements, this mode of registration admits pre-approved investment function licenses in China, Hong Kong, Brazil, the USA, and the UK, thus requiring no extra time-consuming incorporation process.

The standard capital for company formation is $50,000, but there is no minimum outlay. Likewise, the issuance of shares is possible through an authorized agent. Any company accredited in the BVI can hold its meetings anywhere in the world and is exempt from declaring what was discussed. The only requirement is the natural accounting process to be able to carry out the payment of the tax exemption fee and maintenance of the local company.

Confidentiality Is Crucial: How the BVI Protect Your Information

One of the most attractive aspects when locating capital in the British Virgin Islands lies in its confidentiality policy. This system is not standard in financial centers worldwide and allows companies to keep a large part of their operations secret if their members wish to do so.

The local legislation allows the owners of the companies to keep all their personal data protected since banking secrecy is a principle that governs the entire financial system of the territory. Therefore, the annual presentation of accounts is not required, and there is no obligation to carry out internal accounting or audits of operations.

Thus, under the protection of the BVI International Business Companies Ordinance Law, all the information of directors, shareholders, and members of the companies founded within BVI is absolutely protected. This privilege is unique in the world and cannot be left aside when considering the different options to establish your company. 

We have seen how BVI offers little to no obstacles to investors worldwide. A high-speed registration system, almost no taxes, and complete confidentiality are prized conditions for anyone seeking to set up a financial company.

There are plenty of reasons to begin this process, and if that isn’t enough, consider how you’ll spend an unforgettable vacation on the shores of one of the most impressive Caribbean landscapes. Without a doubt, the BVI has it all.

In Mundo, we work with first-level experts that can help you receive the best services in the BVI. Contact us right now, and we’ll put you in touch with our network.

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