About Belize and IBC's

What is an IBC?

An International Business Company (IBC) is a legal entity registered under the laws of a country or jurisdiction, conducting its business outside the country or jurisdiction in which it is registered. An International Business Company (IBC) usually serves as an instrument for international tax planning.

What is International Tax Planning?

International Tax Planning is the legal activity of a company, conducted in order to minimize the taxation effects of its business, including usage of companies, registered in countries with privileged or zero taxation (offshore companies).

Why register an IBC?

An IBC is one of the main instruments for international tax planning. They can also be used to purchase and hold real estate, securities, airplanes and ships, patents, etc.

An IBC enjoys a number of benefits over an onshore company:

• Zero Tax: Most IBCs are exempt from taxes on all profits gained outside the jurisdiction. The taxation rate is zero percent (0%) for an offshore IBC.
• Discretion: An IBC has the right to keep all information about all involved persons: its directors, secretaries or shareholders confidential. The law prevents anyone from enquiring about the details of owners and employees. The owners are not legally required to disclose any information about their company to anyone.
• Confidential Annual Accounts: Financial records of an IBC, including information such as company accounts and share capital can be kept private.
• No annual returns: An IBC does not need to file an annual return.
• Flexibility of Use: An IBC has diverse investment opportunities, and may conduct almost any type of business activity.
• Company meetings: Meetings of an IBC can be held anywhere in the world - not necessarily in the jurisdiction where the company is registered. Moreover, physical presence of attendees is not required during meetings - meetings may be conducted over the telephone and over the Internet, etc., thus saving time and travel expenses. IBCs also need not hold Annual General Meetings.
• Minimal Compliance Obligations: A single individual can register an IBC in an offshore jurisdiction, being appointed as company director at the time of incorporation while also being the sole shareholder. A company secretary need not be appointed.

Using an Offshore Company: is it legal?

Offshore companies can be used in legal schemes of tax planning. Likewise, however, like any other instrument, they can equally be used in illegal operations, including illegal deviation from discharge of tax and criminal money-laundering. The legality of a certain transaction from an offshore company is defined by the legislation of the country of registration, the legislation of the other countries-members of the transaction, and also by the international treaties. Many developed countries apply certain limitations on operations with offshore companies for its residents, but full prohibition is almost never used. Our handholding approach means that we can provide the necessary legal guidance before each and every important transaction is affected, thus avoiding potential illegality or irregularities.

Limitations of the use of Offshore Companies

Many countries impose certain limitations for its residents on the use of operations with offshore companies (the so-called "anti-offshore" regulation). Full prohibition is almost never used. Nevertheless, there are certain discriminatory restrictions, for example, increasing of taxation on operations with offshore companies for country's residents and applying additional currency exchange regulations.

Typical Uses of Offshore Companies

Offshore companies are beneficial for many purposes including at least some of the following:

1. Consultancy, Professional Services, Agency

   Professionals, consultants, artists and many self-employed individuals can gain substantial advantages by working as employees or as external consultants of offshore companies, of which they may be the sole shareholders and, if they want to, the sole directors.

2. Employment of Expatriate Staff

   Expatriates working overseas can frequently benefit from being employed through an offshore employment/consultancy company. This can avoid tax being deducted at source. By not remitting the full salary it can minimize tax and avoid exchange control difficulties in the country of temporary residence. This arrangement will be particularly attractive to expatriates working in politically unstable countries.

3. Property Owning Companies

   There are often significant advantages in using an offshore holding company for the purpose of holding property. The advantages of such an arrangement include the avoidance of inheritance tax, capital gains tax and the ease of sale which can be achieved by transferring the property owned by the company and reduction of property purchase costs to the onward purchasers.

4. Investment Companies

   Funds accumulated through investment companies set up in offshore areas can be invested or deposited throughout the world and whilst generally returns or interest payable in respect of these funds will be subject to local taxation, there are a number of offshore areas in which funds may be placed as bank deposits where the interest and/or the capital gains are paid and kept gross. To invest in global securities including mutual funds not available to "local" citizens. Offshore jurisdictions are typically less invasive allowing for aggressive and unrestrained Free Enterprise.

5. Copyrights, Patents and Trademarks

   Offshore companies can purchase or be assigned the right to use copyright, patent or trademark. Royalties can then be accumulated offshore although often royalties may suffer withholding taxes at source. An interposing holding company in some cases may allow a reduction in the rate of tax withheld at source.

6. Privacy

   A high net-worth individual can save professional fees and unwanted publicity by owning property or other assets through an offshore company. ECI can provide a wide range of services in the field of privacy protection.

7. Protection

   To file first position liens against assets and property closing the door to predatory litigation before it begins. To segregate high-risk investments from other more secure holdings. To protect retirement funds from possible bankruptcy. To provide for the transfer of assets for the next generation in an efficient and discreet fashion. Nominee directors and officers can allow you to conduct business transactions for your benefit while you remain anonymous. To access your funds with corporate debit or credit cards thereby maintaining absolute confidentiality.