Belize is a small Caribbean state in Central America. The country borders on Mexico in the north, Guatemala in the west, and the  Caribbean Sea in the east. A constitutional monarchy and a territory of the British Commonwealth of Nations, the country runs a parliamentary system that holds elections every fiver years. The executive power in Belize lies in the hands of its Prime Minister. 

Belize is considered an excellent jurisdiction for foreign investors. It features a business-enabling environment, thanks to its prevailing rules on corporate privacy. This allows private investors, corporate entities, and board members gaining the right to secure their privacy due to the country’s non-disclosure clause. Additionally, business owners who set up their business in Belize are not deemed to disclose business and financial information, including profits, losses, and major financial transactions. These two provisions alone make Belize an attractive destination for investors from all over the globe. 

To successfully set-up a company in Belize, here are crucial information you must know. 

Reasons to Set Up a Company in Belize for Foreign Investors

The attractive of  Belize as a jurisdiction for foreign investments lies in its superior reliability and reputation as a thriving financial center in Central America.

• High degree of confidentiality of owners and board members
• Close-system registration scheme
• Zero tax burden 
• Speed of company set up
• Companies are not required to submit annual financial and tax reports
• No commercial audits required
• Foreign investors can purchase a ready-made company in Belize
• Cost-effective company registration 
• Beneficiaries’ personal information are not disclosed to the public
• Specialized legislation enforced for trust planning and asset protection purposes
• Belize is known for its excellent regulatory framework and financially-stable economy 

Tax Treatment for Foreign-Owned Companies in Belize

• Foreign-owned companies are totally exempt from paying Value Added Tax (VAT).
• Foreign-owned companies are levied with minimal, fixed annual fees and local taxes. 

Tax Rates for Foreign Owned Companies

• 1.75% of taxable income for amounts exceeding $1.5 million.
• 3% taxable income for amounts less than $1.5 million.
• Corporate tax rate assessed between 1.75% and 19% depending on chosen business structure. 
• Resident companies are required to pay 25% on its financial turnover, with the business profitability not playing a factor in its tax assessments. 
• Annual fee assessed on foreign-owned companies largely depends on the disclosed authorized capital. 

Fixed annual rates assessed on international business companies are as follows:

• Capital amount of up to $50,000 country’s fixed fee going towards the country’s budget is is set at $100 annually.
• Capital amount up to $50,000 or more, country’s fixed fee going towards the country’s budget is is set at $1,00 annually. 
• Companies issuing shares without specific par value are required to pay a fixed fee of $350 annual to the local state treasury office. 
• Fixed annual fees must be paid by January 31 of the following year. Non payment will automatically place a company on blacklist. 
• Companies established before 17 October 2017 shall remain exempt from taxes until 30 June 2021. 
• Only international business companies operating in Belize will be taxed according to the country’s existing taxation regime. 

Amendments in Companies’ Operation in 2019

According to amendments on the rules under the new taxation regime for international business companies enforced on 1 January 2019, the new rules for business conduct will then be applied moving forward. 

International business companies formed in Belize are entitled to the following:

• Real estate purchase or acquiring shares of real estate in Belize. 
• Hold shares in any state-owned company, both local and international
• Operate and engage in business transactions with Belize residents. 
• Allowed to open and manage a bank account with a local financial institution. 
• Engage in direct investments and trades in Belize. 
• International business companies allowed to trade in securities, including foreign exchange and brokerage services are required establish their physical presence in the country. This requirement must be met by an international business company before the end of 2019. 
• International business companies that decide to establish their presence in Belize will be treated and taxed as a state resident. Therefore, they will be taxed under the standard Belize tax system. 
• International business companies that decide not to have a physical presence in Belize, but instead maintain activities with income outside of Belize will not be treated or taxed similar to a local resident, and therefore will not be assessed with income tax. 

Additional Registration Requirements in Belize

• International business companies can apply for a Certificate of Good Standing, given the annual fee is fully paid. 
• International business companies can apply for their own tax identification number (TIN). 
• Having a tax identification number, international business companies are entitled to file their annual tax returns together with non-consolidated financial documents. 
• Prevailing accounting rules developed by the Accounting Records Maintenance Act of 2013 shall remain enforced. 
• Companies with an annual income of $6 million and a minimum income of $250,000 operating in the country’s technical zone will be audited by an authorized person from the Belize Tax Commission. 
• Companies with an income between $250,000 and $6 million will be audited on total income, assets, and employees.  

The Belize companies enumerated below will be under the regulatory supervision of the Belize Tax Authorities:

• Registered persons on the stock exchange. 
• Restructuring, liquidation or selling of all assets that go through an auction.
• Execution of activities regulated by the Financial Services Commission of Belize.
• Perform activities that require preparation of consolidated financial documents. 

International business companies registered before 16 October 2017 will be exempt from paying taxes until 30 June 2021. They will be issued with a Tax Exemption Certificate. Companies registered after 17 October 2017 that requires a Tax Certificate must prove the following:

• Company does not have a physical presence in Belize. 
• All its income-generating activities are carried out in another country, provided  that it features applicable taxed in accordance to the Belize Income and Business Tax Act. 
• Legal documents certifying the payment of international business company tax rate.

All international business companies in Belize are deemed to keep an updated register of their directors, shareholders, and ultimate beneficiaries. Documents must be fully signed by the director at the company’s physical address. 

Company Registration Process in Belize

1. Form 2019

• Form 2019 refers to the creation of companies with an IBC (international business company) structure and LTD legal form. 

• The most common form of international business company in Belize is the IBC (international business company)

• All companies registered in Belize can choose from the following legal suffixes, such as Ltd. Limited, Inc., Incorporated, Corp., Corporation, and Public Limited Liability Company

2. After successful registration in Belize, owners can depend on the country’s confidentiality rules. 

• There is no open registry of entrepreneurs in Belize. 

• Information on directors and founders will not be available or accessible by the general public. 

• All duly registered companies must undergo the KYC (Know Your Client) verification process to confirm the identities. 

• Identify a company’s scope of activity, which may fall under categories, such as legal, banking, insurance, and other industries that may require additional licensing. 

• In Belize, there is a high demand for foreign exchange licenses, brokerage instruments, financial trading, financial derivatives, pledge and credit operations, currency exchange, and many more. These companies will be assessed with a fixed annual fee. 

• Non-resident companies registered in Belize can own real estate, purchase land, and engage in transactions with its local residents. Despite these, companies cannot benefit or earn income from real estate transactions in Belize, other than leasing for business reasons. 

• Authorized minimum capital payment is set. However, there are no existing requirements for its mandatory payment. 

• Standard share capital is $50,000

• Foreign-owned companies may issue registered shares. 

• It is adequate to issue one share for opening a company in Belize. This is the standard amount of share capital required from a foreign-owned business, regardless of origin country. 

• Capital contributions can be paid using any currency; an option in registering a company without a set capital requirement.
  
• International business companies are not required to file their financial statements. 

• Financial statements cannot be stored or kept in Belize. 

• The Belize government required mandatory maintenance of company accounting records. 

Registered Company Requirements in Belize

Directors

• A company must have at least one director, natural person or corporate entity. 
• No residency requirement for owners and directors. 

Shareholders

• A company must have at least one shareholder, natural person or corporate entity. 
• No residency requirement for shareholders. 

Secretary 

• Not required by law.

Document Requirements for Belize Company Registration 

• Copy of passport or national identity documentation.
• Copies of documents proving citizenship and place of residence. 
• Copy of Certificate of Incorporation
• Copies of incorporation documents. 
• Copy of Apostille of the bound set of copies of constitutional documents
• Copy of Subscriber’s Resolution
• Resolution of first shares allotment
• Share certificates

Belize Taxation Regime

• No Value Added Tax assessment on  foreign-owned companies.
• Basic corporate tax rate assessed between 1.75% and 19%. 
• No capital gains tax. 
• International business companies with income more than $37,500 annually will be assessed with payment of business tax monthly as per applicable tax rates for specific business type. This will be regarded as credit toward annual tax assessments. 
• No stamp duty tax. 

Belize Double Tax Treaties

Belize signed double tax treaty agreements with the following countries:

• United Kingdom
• Sweden
• Denmark
• Countries of the Caribbean Community (Antigua and Barbuda, Bahamas, Barbados, Belize, Dominica, Grenada, Guyana, Haiti, Jamaica, Montserrat (a British overseas territory in the Leeward Islands), Saint Kitts and Nevis, Saint Lucia, Saint Vincent and the Grenadines, Suriname, and Trinidad and Tobago)

Damalion is a premier consulting firm offering comprehensive solutions to foreign investors looking to set up a company in Belize. We offer turnkey solutions that include company formation services and providing connections to our global service network of service professionals, including lawyers, accountants, consultants, and many more. We also offer associated services, including opening a bank account, financial consulting, and expert business consulting at every stage of your business operations. To learn more about our services, reach out to a Damalion expert today. 

This information is not intended to be a substitute for specific individualized tax or legal advice. We suggest that you discuss your specific situation with a qualified tax or legal advisor.