Business in the Caribbean and Vanuatu

Citizenship by investment programs function in Antigua and Barbuda, Dominica, Grenada, St Kitts and Nevis, and St Lucia. These countries offer entrepreneurs convenient conditions for registering companies and, in some cases, tax incentives.

Foreigners can register companies in Caribbean countries. The process is remote; it takes place on designated government web portals. The applicant prepares the required documents: the charter, the memorandum of association, and copies of the founders’ passports. Additional documents, for example, bank statements, letters of recommendation, and certificates of no criminal record may be required.

Company registration takes from a couple of days to two weeks.

The International Business Company (IBC) is the most popular form of business in the Caribbean among foreign residents. Such a company can only receive income from sources abroad.

An IBC must have a registered office and an agent from among the country’s residents, for example, an accountant or an attorney.

The authorised capital is not limited by law. In practice, it usually starts at $10,000. The recommended authorised capital in St Lucia is at least $50,000.

A company may have one or several shareholders.

Taxation for companies. Corporate tax ranges between 25% and 33% in Caribbean countries. In most cases, resident companies pay taxes on global income. The exception is St Lucia: corporate tax is paid there only if the income is received from a source within the country.

The standard VAT rate depends on the state and is 12.5 to 17%. Companies also pay social contributions of 4 to 7% of the salary if they hire employees.

Antigua and Barbuda has a tax holiday for companies that earn income only from abroad. They are exempt from corporate tax for 50 years.

Withholding tax on payment of dividends to non-residents is up to 25%. When paid to the country’s residents, the tax isn’t levied.

Caribbean countries usually have double tax treaties with a small number of states, most of which are within CARICOM. The profits of the company and its shareholders may be taxed abroad at standard rates.

In addition to registering a company, an investor with Caribbean citizenship can visit more than 140 countries visa-free, including the UK and the Schengen states. The second passport helps to come to negotiations and business conferences anytime.

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The International Company (IC) is the most popular legal form of business in Vanuatu among foreigners. Such a company can only operate abroad: it cannot provide services or sell goods, buy real estate, or offer shares to the locals in Vanuatu. It will not be possible to obtain a banking or insurance business licence.

An IC must have a registered office and a representative in Vanuatu.

To register a company, the applicant provides a charter and personal data of the founders, shareholders and director. Bank information may be required. You don’t have to come to the country to register a company. It takes several days to register a company, considering the time for collecting necessary documents.

Vanuatu’s taxes for companies are the main advantage of the jurisdiction. ICs are exempt from taxation for 20 years from the registration date. They only pay the following fees:

• $150 — upon registration;

• $300 — annually.

Vanuatu doesn’t have double tax treaties with other states. Therefore, the company and shareholders’ income is taxed in other countries at standard rates.

Investors with Vanuatu citizenship can visit more than 90 countries, including the UK, without visas. Freedom of movement allows them to go to business meetings or events anytime.

Practical Guide

Practical Guide

Compare the Caribbean and Vanuatu citizenship by investment programs

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1. One doesn’t have to be a resident to register a company in a Caribbean country or Vanuatu. The procedure is remote and takes several days.

2. A registered office in the country and a local representative are mandatory for International Business Companies (IBCs) and International Companies (ICs).

3. Caribbean corporate tax is up to 33% and levied on all resident companies’ income. The exceptions are St Lucia, where the tax is levied only on income from local sources, and Antigua and Barbuda, where IBCs can become exempt from corporate tax for 50 years.

4. ICs are exempt from taxes for 20 years in Vanuatu. Instead, they pay an annual fee of $300.

5. A second Caribbean or Vanuatu passport provides the investor with additional opportunities, for example, to visit the Schengen Area or the UK without visas.