Belize Offshore LLC Formation
- Last updated on . Written by Offshore Protection.
Belize is a popular jurisdiction for offshore financial services due to its lack of taxes and strict privacy policies. The preferred type of business structure in Belize is a Limited Liability Company (LLC), as it offers superior asset protection and is the easiest and most affordable type of legal entity to form.
A Belize LLC is a separate legal entity that offers limited liability protection to its members. The Belize International Business Companies (IBC) Act was established in 1990, which set the foundations for offshore company incorporation in Belize. They went on to enact the Offshore Companies Regulations of 1996 which expanded on the rights and responsibilities of offshore companies in Belize. The more recent International Limited Liability Companies Act of 2011 also allows for the formation of offshore LLCs in Belize.
For more>> Belize as a Tax Haven
Table of Contents:
- Belize Background
- Advantages Of A Belize LLC
- Top Uses
- Limitations
- Key Corporate Features
- Package Includes
- Requirements For Incorporation
- Steps To Form A Belize Offshore LLC
- Taxation
- Corporate Details Of A Belize LLC
Belize Background
Belize is a country located in Central America, bordered by Mexico to the north and Guatemala to the west and south. It has a tropical climate with hot, humid weather and a rainy season from June to November. The official language is English, but Spanish is also widely spoken. The economy is primarily based on agriculture, tourism, and offshore finance. Belize is considered attractive as a jurisdiction for offshore finance due to its stable government, low taxes, and strong privacy laws.
Advantages
A Belize LLC provides numerous benefits, including but not limited to:
- Limited liability: A Belize LLC offers limited liability protection to its members, which means they are not personally liable for the debts and obligations of the company beyond their initial investment amount.
- Asset protection: In addition to the standard limited liability protections, a Belize LLC is also protected by Belize’s strong asset protection regulations. Belize courts do not recognise foreign judgements or court orders against a member of an offshore LLC. To win a claim against the assets held in a Belize LLC, the claimant would have to file a case with local courts in Belize, for wrongful acts which occurred in Belize itself. Even then, it is rare for courts to award such cases in favour of the claimant.
- Tax benefits: Belize offshore LLCs are completely exempt from local corporate and personal income taxes on income sourced from outside of Belize. There are also no capital gains or withholding taxes. Offshore companies are required to a pay a flat annual fee of $330 irrespective of the company’s size or profits. This is the only “tax” applied to offshore companies in Belize.
- Privacy: Belize provides the utmost in privacy and confidentiality. No sensitive information, such as the names of members, managers, or beneficial owners, is publicly accessible. Annual returns and other financial information are also not made public.
- Fast and simple registration process: the registration process is extremely simple. It can be completed in as little as 2 days, but one should generally expect the entire process to take around 1 week including the gathering and preparation of all required documentation.
- Minimal economic substance requirements: Belize LLCs are subjected to minimal economic substance scrutiny. They do not need to submit annual financial audits or tax filings, nor are they required to hold annual meetings in Belize or prove active business operations.
- Flexibility: A Belize LLC can be used for many purposes. It can act as an operating company for those wanting to actively engage in business operations offshore. It can also be used as a holding company to hold all kinds of assets and other legal entities, including trusts, foundations, and other IBCs, vehicles, real estate, securities, etc. A Belize offshore LLC can also be used to engage in international trade of securities and other assets, or simply to open an offshore bank account.
- Foreign ownership: 100% foreign ownership is permitted.
- Single-member ownership: Minimum of only one member is permitted, who may also act as the sole manager of the company.
- No language barriers: English is the official language, and all corporate documents and legislation are in English.
- No foreign exchange controls or significant trade restrictions: The Belize government does not impose any exchange controls, which means a Belize LLC can operate in any currency without any restrictions or limitations. A Belize LLC is also free to engage in international trade without any significant restrictions.
- No minimum authorised capital requirements: The minimum authorised capital of a Belize LLC is $1.
- Access to foreign investment opportunities: A Belize LLC can provide access to new foreign markets and investment opportunities in Belize itself and other offshore jurisdictions.
- Migration of domicile of Belize LLCs is permitted: The International Limited Liability Companies Act, 2011 states that an LLC can move to Belize from another jurisdictions and vice versa.
Top Uses
The operating agreement of a Belize LLC may contain provisions for conducting any type of business provided it is lawful. This allows great flexibility in what a Belize LLC can be used for, including common uses such as:
- Holding real estate, securities, and other assets
- Estate planning
- Asset protection
- International trade or business operations
- Intellectual Property (IP) holding
- Providing access to foreign investments and securities exchange
- Yacht and boat registration and ownership
- Financial privacy
Limitations
A Belize offshore LLC provides many benefits and uses, but it does also have some limitations and restrictions. Under the Belize International Limited Liability Companies Act, 2011, offshore LLCs are not allowed to:
- Receive profits from Belize residents,
- Be the sole owner of real estate,
- Own shares in any local Belize company,
- Issue its own shares in the name of a Belize resident.
Key Corporate Features
Package Includes
- Government Registration Fee (First year)
- Registered Office Address (First year)
- Registered Agent Services (First year)
- Company Secretarial Maintenance
- Certificate of Organisation
- Articles of Organisation
- Minutes of First Organisers Meeting
- Ownership Certificates
- Register of Members
- FREE Phone and/or email consultations
Requirements for Incorporation
To form a Belize LLC, a registered agent will need to submit all the necessary documents to the Belize Registrar of Companies. The following documents are typically required:
- Proposed company name,
- Information on company members and managers (names, address, etc.),
- Passport copies and address proof for each member/manager,
- Information on the company’s authorised capital and shares (number of shares and par value),
- A declaration of compliance,
- A resolution of incorporation (includes details such as registered office address, purpose and nature of the business, additional provisions which are deemed of importance),
- A Memorandum and Articles of Association,
- Proof of payment of government registration fee,
- Proof of payment of registered office services.
Steps
The process of forming an LLC in Belize is straightforward and involves the following steps:
- Choose a Company Name: The first step in forming an LLC is to choose a unique name for your company. The name must be approved by the Belize Registrar of Companies.
- Appoint a Registered Agent: All Belize LLCs must appoint a local registered agent to act as the official point of contact for the company.
- Acquire a registered office address in Belize: this address will need to be submitted to the registrar as part of the required documentation for registering the LLC.
- File the Articles of Association and Memorandum: The Articles of Association along with the Memorandum must be filed with the Belize Registrar of Companies. This document lays out the basic information about your company, including its name, purpose, and ownership structure.
- Obtain a Business License: An International Business Company (IBC) license is a requirement to legally operate a Belize offshore LLC. Once your LLC is officially recognized by the Belize Registrar of Companies, you'll need to obtain this business license.
- Open a corporate bank account in Belize (optional): A corporate bank account is not mandatory for a Belize LLC, but it is a recommended for the LLC to have a separate bank account for its financial transactions.
- Register for Taxes: After obtaining your business license, you'll need to register for taxes in Belize. This involves obtaining a tax identification number and registering for any relevant taxes, such as sales tax and income tax (if conducting business in Belize). Profits sourced from outside Belize are exempt from corporate income tax.
Taxation
Belize offshore LLCs are exempt from all forms of corporate taxation in Belize.
This includes income tax, capital gains tax, withholding tax, etc. However, the LLC is still required to file annual financial statements and pay a yearly fee of $330 to the government.
Corporate Details
Privacy (Anonymity, Confidentiality and Disclosure)
Belize LLCs offer a high degree of privacy as the names of the owners and managers are not publicly available. Sensitive financial information is also kept confidential and not accessible to the public eye.
Type of Law
Belize has a mixed legal system, which is primarily based on English common law as well as local customary law. The legal system in Belize is influenced by the laws of the United Kingdom because Belize was a British colony until 1981.
Principal Corporate Legislation
The principal pieces of corporate legislation applicable to Belize offshore LLCs are the International Business Companies Act of 1990 and the Belize International Limited Liability Companies Act of 2011. The latter has been modelled on the Nevis LLC law of 1995 and the Cook Islands LLC Act of 2008.
Language of Legislation and Corporate Documents
English is the official language and therefore all legislation and corporate documents are in English.
Powers of the Company
A Belize LLC is a separate legal entity from its members and managers. It has all the same powers and rights as a natural person. As such, it has the power to carry out its business activities as defined in its articles of association and to enter into contracts, sue or be sued, and own assets in its own name. Members are not personally liable for the company’s obligations, which means their liability is limited to their investment in the company.
Required Capital
There is no minimum authorised capital requirement.
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.
Member and Manager Meetings
Annual member and manager meetings are a requirement, but these meetings can be held anywhere in the world.
Financial Statements and Auditing Requirements
A Belize LLC is required to maintain financial records and file annual financial statements with the Belize International Business Companies Registrar. There are no mandatory audits.
The exact fee for filing financial statements in Belize may vary, depending on the service provider, the complexity of the financial statements and numerous other factors.
Local Registered Office and Agent Requirements
It is a requirement to appoint a local registered agent and maintain a registered local offic address.
Exchange Control
Belize has liberal exchange controls and does not restrict the movement of funds into or out of the country. However, residents and non-residents must declare currency or monetary instruments exceeding the equivalent of USD 10,000 when entering or leaving Belize.
Shelf Companies Available
Yes, shelf companies are available for faster incorporation.
Time Required to Form Offshore Company
It takes only two business days once the documents have been submitted to the registrar. However, the entire process should take around one week including gathering and preparing the required documents before submitting them.
Language of Name
The name may be in any language, as long as it adheres to the requirements and restrictions outlined below.
Name Restrictions
- The name of the company should be unique and not similar to any existing companies in Belize.
- The name should not be deemed offensive or derogatory.
- It must include either the words “Limited Liability Company” or the abbreviation “LLC”.
- The words “bank”, “insurance”, or any other term which implies it is undertaking such activities, including the unlicensed sale of securities, is forbidden without having the proper license to do so.
Special Licenses or Permissions
Certain industries such as banking, insurance, or other financial services, require additional licensing and permission.
Formation with Offshore Protection
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