Bahamas LLC Formation
Since as early as the 1930s, the Bahamas has been a “go to” jurisdiction for offshore financial services. It’s lack of all forms of taxation, along with its strict privacy policies, have been two of the major characteristics which have attracted foreign investors and businesses to its shores. The Bahamas is particularly suitable as a jurisdiction for offshore company formation, which can provide a myriad of benefits to its owners. A Bahamas LLC is the preferred type of offshore business structure to set up in the Bahamas.
An LLC is a separate legal entity which offers limited liability protection for its members. The management of a Bahamas LLC is flexible and can be set up in a variety of ways, such as through members or managers. The Bahamas has strict laws in place to protect the privacy of LLC members, and it has no corporate income tax, capital gains tax, or withholding tax. The Bahamas LLC is an ideal structure for international trade and investment activities, and it can be used to hold assets, conduct business operations, and protect assets in other countries. Additionally, the Bahamas has no exchange control regulations making it easy for businesses to move money in and out of the country.
A Bahamas LLC can be incorporated as an LLC under the Companies Act of 1992 or as an international business company (IBC) with limited liability protection under the International Business Companies Act of 2000. The IBC is the more popular choice for foreign members who are not interested in conducting business locally in the Bahamas.
For more>> Bahamas as a Tax Haven
Table of Contents:
- Advantages Of A Bahamas LLC
- Top Uses
- Key Corporate Features
- Package Includes
- Requirements For Incorporation Of A Bahamas LLC
- Registration And Renewal Fees
- Corporate Taxation Of A Bahamas LLC
- Corporate Details
Advantages of a Bahamas LLC
A Bahamas LLC provides the following benefits:
- Limited liability protection: A Bahamas LLC offers limited Liability protection to its members, meaning that members are not personally liable for the debts and obligations of the LLC.
- Flexible management structure: A Bahamas LLC may appoint separate managers, or members may act as managers, or a combination of the two. This allows for a variety of management structures to be set up.
- Asset protection: The Bahamas has strong asset protection regulations in place. It can be used to hold assets such as real estate, investments, and intellectual property. A Bahamas LLC can provide an additional layer of protection for these assets, making it more difficult for local creditors to access them.
- Privacy: The Bahamas has strict laws in place to protect the privacy of LLC members. The names and addresses of members are not publicly available and there is no requirement to file annual returns with detailed financial information.
- Tax benefits: The Bahamas has no corporate income tax, capital gains tax, or withholding tax. Use of a Bahamas LLC can be an ideal way to minimise your tax liability if combined with the correct tax structures. US citizens will still have to declare and pay taxes on their worldwide income.
- International trade and investment opportunities: A Bahamas LLC is an ideal structure for international trade and investment activities. It can be used to hold assets and conduct business activities in numerous countries around the world, making it a useful tool for companies looking to expand their international operations or individuals looking to access foreign investment markets.
- Freedom of exchange: Bahamas does not impose any exchange or trade controls. Money can be freely moved in and out of the country, which can help to facilitate international trade and investment activities.
- Foreign Ownership: A Bahamas LLC can be 100% owned by foreigners.
- Member and manager requirements: A Bahamas LLC only requires a minimum of one member and one manager. Members may act as managers themselves.
- Fast and simple registration process: registering a Bahamas LLC is a straightforward process which can be completed in as little as one business day.
- Low registration and maintenance fees: The registration fees for a Bahamas LLC depend on the specific requirements of the company but are typically low. The Government fees for both registration and renewals are usually only a few hundred dollars. This does not include registered agent fees and professional legal fees, which can range from a few hundred to a few thousand dollars depending on the services offered.
- No minimum capital requirements.
A Bahamas LLC can be used for any type of business, as long as it is lawful. Some of the top uses of an offshore LLC in the Bahamas include:
- As a holding vehicle for real estate and other assets
- Asset protection
- Estate planning
- Engaging in international trade or e-commerce
- Holding intellectual property
- As a parent company of a group of subsidiary companies
- Vehicle for holding offshore bank accounts and/or investments
- Yacht ownership
Key Corporate Features
- Government Registration Fee (First year)
- Registered Office Address (First year)
- Registered Agent Services (First year)
- Company Secretarial Maintenance
- Certificate of Incorporation
- Memo & Articles of Association
- Appointment of 1st Directors
- Consent Actions of the BOD
- Share Certificates
- Register of Directors
- Register of Officers
- Register of Shareholders
- FREE Phone and/or email consultations
Requirements for Incorporation of a Bahamas LLC
To register an LLC under the 2000 Company Act, the LLC must provide proof of the names and addresses of the officers and managers to the Registrar General, including passport copies, address proof, etc. The documents which need to be filed are the company’s Memorandum and Articles of Association. Once these have been approved, the LLC will officially become a legal entity without any additional waiting periods. The entire application process can be completed in one day.
The articles of association must include:
- Company name.
- Statement of purpose or objectives of the LLC.
- Registered office address.
- List of members and the number of shares each member holds.
- The authorised share capital of the LLC, including the number of shares and their value.
- Management structure, including specification of powers and responsibilities of the members and managers.
- The procedure for holding meetings and making decisions.
- Accounting and auditing requirements.
- Provision for the dissolution of the LLC.
- The governing law that will apply to the LLC and its activities should be specified.
Registration and Renewal Fees
The registration and renewal fees for a Bahamas LLC vary depending on the specific requirements of the company and are also dependent on its authorised share capital. The fees include government fees, registered agent fees, and professional fees (for drafting the necessary documents, providing guidance, and preparing and filing annual reports on an ongoing basis).
The government fees for both registration and subsequent renewal are typically in the region of a few hundred dollars. Registered agent fees can range from a few hundred dollars to several thousand dollars, depending on the services provided. Initial and ongoing professional fees are usually several hundred dollars, which are again dependent on the services provided.
Corporate Taxation of a Bahamas LLC
The Bahamas has an extremely favourable corporate tax structure. It does not levy any corporate income tax, capital gains, withholding, or dividends taxes on companies not conducting business within its borders. There is also no direct personal income tax or net worth taxes. There is no requirement for an IBC to file an annual tax return.
The Bahamas does levy a real property tax of up to 2%, with the opportunity to claim several exemptions. There is also a stamp duty on the transfer of some assets and financial instruments.
Citizens of the US and other countries which are subject to worldwide taxation must still declare their income to their local tax authorities.
Bellow we expand on some of the key corporate features of a Bahamas LLC mentioned in the table above:
Principle Corporate Legislation
The principle corporate legislation governing Bahamas LLCs is the International Business Companies Act of 2000. This act sets out the legal framework for the formation and operation of international business companies (IBCs) in the Bahamas, including LLCs. It provides the rules and regulations for the incorporation of IBCs, including requirements for members, managers, overall management, and record-keeping.
There is no minimum authorised capital requirement for forming a Bahamas LLC.
Members and Managers
A minimum of one member and one manager is required. Members may act as managers. Both members and managers can be of any nationality.
Financial Statements Required
There is no requirement to file financial statements with the government when incorporating a Bahamas LLC.
A company secretary is not required.
There are no restrictions on trading.
Language of Legislation and Corporate Documents
The official language of the Bahamas is English, and all legislation and corporate documents must be in English.
Registered Office and Agent Requirements
Both a registered office and a local registered agent in the Bahamas is required when incorporating a Bahamas LLC.
Shelf Companies Available
Shelf companies are available in the Bahamas. These can be purchased and used immediately.
Time Required to Form Offshore Company
As little as one day from when the documents are submitted. Gathering and preparing the documents can take up to one week.
There are certain restrictions on the names that can be used for a Bahamas LLC. The name cannot be similar to an existing company, and it cannot contain certain words such as “bank” or “insurance” without prior authorization.
Language of Name
The name of a Bahamas LLC can be in any language, but the official documentation and registration must be in English.
Requiring a Special License or Permission
A special license or permission is not generally required to form a Bahamas LLC. However, certain industries such as banking, insurance, or other financial services, may require additional licensing or permission.
Manager and Member Meetings
Annual manager and member meetings are not required for a Bahamas LLC. Meetings are also allowed to be held telephonically.
The Bahamas has strict laws in place to protect the privacy of LLC members. The Memorandum and Articles of Association are available in public records, which only include the names of the managers and registered officers. The names and addresses of the members are not publicly available and there is no requirement to file annual returns with detailed financial information.
The Bahamas has no exchange control regulations.
Type of Law
Bahamas LLC Company Formation with Offshore Protection
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