Register company in Belize: Introduction
To register company in Belize can be hassle-free if you understand the process. Tetra Consultants assists our international clients with Belize company registration. With us at the wheel, you will be able to dedicate your time and resources to other more important business activities.
Belize is a newly independent Caribbean country, having gained independence from the United Kingdom in 1981. Its strategic location in between Central America and the Caribbean has allowed it to maintain strong ties to both regions, alongside its pre-existing colonial relationship with the United Kingdom. The Belize government has since tried to shift away from the country’s traditional reliance on agriculture with the enactment of the International Business Companies Act which aims to attract foreign investments. To date, more than 15,000 new companies have been set up.
With our lean-and-mean mentality, you can rely on our team of experts to provide you a seamless experience throughout the whole process of Belize company registration. Our ultimate goal is for your Belize company to be operationally ready within the stipulated time frame.
Our service package includes everything you will require to register company in Belize:
What is a tax haven and why is Belize regarded as one?
- As suggested by its name, tax havens usually have zero or at most, minimal tax rates and are thus often used for illicit activities such as tax evasion. Tax havens also have come to mean a jurisdiction which offers high levels of privacy, political and economic stability as well as an ease of doing business for foreigners and residents alike.
- Whilst these three qualities are all encompassed by Belize, it is not considered to be one ever since its removal from the European Union’s (EU) blacklist in 2019. While it is no longer officially considered as a tax haven by the EU or the Financial Action Task Force’s standards, the image of a tax haven remains.
- This is likely due to the fact that many sources of income are exempted from tax in Belize. International Business Companies (IBCs) are exempted from corporate and capital gains tax. There is also no inheritance tax or stamp duty charges.
- While a tax-free regime may seem enticing, Tetra Consultants advises you to carefully consider the disadvantages of setting up a company in a tax haven before deciding to do so. Generally, Tetra Consultants recommends that you set up offshore companies in more reputable jurisdictions such as Singapore, Hong Kong, UK, Ireland, Liechtenstein or UAE when your company requires more credibility in its business operations.
What are the new economic substance requirements and how do they affect businesses looking to register company in Belize?
- As part of its tax reforms to maintain compliance to the EU standards, Belize enacted the Economic Substance Act in October 2019 to oversee the country’s economic activities.
- The Act ensures that Belize does not facilitate or encourage the use of corporate structures which attract profits but are not necessarily legitimate in reflecting the real economic activities that are operated in Belize. It aims to mitigate harmful tax practices and create a more legitimate business environment in Belize. Ultimately, this comprehensive new legislation seeks to distance Belize from its traditional associations with tax havens.
Who is subject to the new requirements to register company in Belize?
- Entities that have to observe this law include IBCs licensed by the Belize International Financial Services Commission or are in the banking, insurance, fund management, financing and leasing, headquarters, shipping, distribution and service centre business. Holding companies engaged in any of the above activities are also covered under the law. However, holding companies that own only tangible assets or a bank account and are not involved in any of the above activities are not subjected to the law. Pure equity holding companies will be subjected to reduced substance requirements.
- To demonstrate the level of core income-generating activities, your company must have:
- an adequate amount of annual operating expenditure
- an adequate level of qualified full-time employees
- an adequate number of physical offices
- To demonstrate substantial economic presence in Belize, companies are to satisfy the following:
- an adequate number of meetings of the Board of Directors are conducted in Belize
- there is a quorum of the Board of Directors present for meetings in Belize
- strategic decisions made at the meetings must be recorded in the meeting minutes
- all records and minutes are to be kept in Belize
- the Board of Directors must have the necessary knowledge and expertise to discharge its duties
Penalties for failure to comply
- Entities are to report within nine months of the end of a fiscal year. Failing to do so will lead to an administrative penalty or being struck off from the Company Registry.
- Before the start of the engagement, Tetra Consultants will advise you on the appropriate economic substance regulations based on your intended business activity. If necessary, our team will assist with the local office and recruitment of local employees. We will also continue to assist with annual reminders to ensure that reporting to the relevant authorities is done in a timely manner.
How long does it take to register company in Belize and open a corporate bank account?
- Tetra Consultants will complete your Belize company registration with a seamless procedure.
- Upon receiving the required due diligence documents of the directors and shareholders, Tetra Consultants will conduct a name search with the Belize International Business Companies Registry to reserve your preferred name.
- Companies must file their application through a listed financial or corporate service provider. Tetra Consultants will provide you with one to help you file your application.
- Within 1 week, you can expect to receive the documents of your new company including your Company Registration Certificate as well as the Memorandum and Articles of Incorporation.
- After successful company formation, Tetra Consultants will assist you to open a corporate bank account with an onshore or offshore bank of your choice. This will usually take around 4 weeks to be completed.
- You can expect to start operations with your Belize company within 5 weeks upon engaging Tetra Consultants.
- Tetra Consultants’ team of Chartered Accountants is able to provide a full suite of services that will ensure that your newly incorporated company will continue to abide by all regulations. These services include monthly bookkeeping, preparation of fiscal statements and annual tax return filings.
Can a foreigner register company in Belize?
- Foreigners can start a business in Belize since 100% foreign ownership is not only allowed but encouraged through the creation of the International Business Company Act.
- This form of company has minimal requirements, including no residency requirement for the director, making it easy for foreigners to start company in Belize as well.
How to register company in Belize?
- Tetra Consultants has assisted numerous clients to incorporate in Belize. Our formation package will get you on your way to setting up your new corporate home in Belize. Tetra Consultants advises you to read through this guide to fully understand the steps for a successful incorporation process.
Step 1: Choosing a suitable corporate entity to register company in Belize
- After understanding your business goals and activities, our team of dedicated consultants will recommend the most suitable corporate entity for you to carry out your business. Prior to incorporating a Belize company, you will be advised on the optimum paid up share capital, corporate structure, legislations and whether there is a need to apply for any licenses to operate.
Step 2: Reservation of company name
- Tetra Consultants will reserve your preferred company name with the Belize International Business Company Registry.
Step 3: Preparation of supporting documents to register company in Belize
- Before Tetra Consultants can incorporate your company in Belize, you are required to provide us with the required KYC documents. Some of these documents include the names of directors and identification proof.
- Upon receiving all the necessary documents, Tetra Consultants will proceed to draft and notarize the company’s Memorandum and Articles of Association.
- According to the business activity and corporate structure, Tetra Consultants will also draft articles of incorporation, business plan and other incorporation documents.
Step 4: Filing to register company in Belize
- All companies incorporated under the IBC Act must have a listed office and registered agent in Belize. As such, we will provide you with such services to ensure that you stay compliant.
- After receiving approval from the Registry, Tetra Consultants will courier the Certificate of Incorporation, Memorandum and Articles of Association and other documents to your preferred address.
Step 5: Corporate bank account opening
- After registration, Tetra Consultants will assist you in opening a corporate bank account. Our team has established partnerships with multiple reputable banks in Belize. We will present your business to each relationship manager and compliance team.
- Typically, opening the account will take roughly 4 weeks. In most cases, the directors and shareholders are not required to travel. However, if travel is required, we will have a representative accompany you to the bank meeting. Alternatively, our team will negotiate with the banks to conduct a conference call instead or to request for a waiver.
- Once your account has been successfully opened, Tetra Consultants will courier the internet banking token and access codes to your preferred address.
Step 6: Trade license applications
- If trade licenses are necessary, Tetra Consultants will continue to process the relevant applications to ensure that your business operations can be conducted smoothly.
Step 7: Financial reporting and taxation obligations
- Following the setup of your new Belize company, Tetra Consultants will continue to provide you with the necessary accounting and tax services to ensure that you can continue to legally conduct business while staying compliant to regulatory obligations.
- Pursuant to the latest legislations enacted by Belize, you will also have to apply for the Tax Identification Number. Tetra Consultants will continue to assist you with such applications.
- Our team of dedicated consultants will timely prepare your firm’s fiscal statements, corporate tax returns and manage bookkeeping on your behalf.
- IBCs doing business within Belize will also be subjected to an income tax and stamp duty. It is also mandated that all companies are to file an income tax return.
- All companies incorporated in Belize are also required to maintain relevant documents that can explain your firm’s financial position for a minimum of five years. However, you will not have to host Annual General Meetings.
Types of Business Entities in Belize
- Although Belize is most popular for its International Business Company (IBCs), with over 15,000 IBCs on its shores, it also features many other types of business entities.
- Generally, for most companies in Belize, you will only require a director and shareholder of any nationality, a local registered address and agent. No minimum paid up authorized capital is necessary for incorporation.
- Prior to the start of the engagement, Tetra Consultants will fully understand your business before recommending the most optimum business entity in Belize. Some considerations we take into account include the type of business activity, tax obligations and nationalities of shareholders and directors. Our consultants will also offer more information on the requirements imposed to set up these entities.
- This is the most basic form of business enterprise and is an extension of the owner’s legal personality as opposed to a separate legal personality. As such, the proprietor can be personally liable for all debts and obligations incurred by the company in the case of a winding-up situation. Any transfer of business is also not allowed under this form resulting in no continuity or inheritance of the business.
- If you are looking to set up a small business (minimart, art studio, baker, etc.) with no intentions to expand, sole proprietorship may be the business form for you. By adopting this business structure, you can expect to enjoy an easy start up and complete control.
- Unlike many other countries, setting up a sole proprietorship in Belize will also require you to register with the Income Tax Department to obtain a Taxpayer Identification.
Public Investment Companies
- Established under the IBC Act, the provision allows public investment companies to conduct business locally while benefiting from the complete exemption of taxes and duties for up to thirty years.
- Under the act, a public investment company is to fulfil the following requirements:
- Net tangible asset value of a minimum of US$2,500,000.
- A gross tangible asset value of a minimum of US$25,000,000.
- Net income of a minimum of US$500,000.
- Have carried on business locally for a continuous period of 24 months and an average net income for each of the two previous complete fiscal years of not less than US$375,000.
- Provided full-time employment for at least fifty Belize residents during a continuous period of 24 months.
- Listed on an Approved Stock Exchange or intends to be listed within the next 24 months
Limited Life Companies
- Otherwise known as the Belize Limited Duration Company, this entity only has a lifespan of fifty years. However, the company can be continuously renewed for additional fifty year increments. This entity is also exempted from paying any tax. With more flexibility, you can carry on any business that is not prohibited by the Belize laws. Members and managers also need not be residents in the country.
- This entity is typically adopted by those who are looking to protect their assets.
Limited Liability Partnership
- Under the limited liability partnership entity, directors are not personally liable for any debts or obligations incurred by the company. They will only be held liable up to a specified amount of liability insurance as per personally declared. These companies provide different classes of members that entitles them to different rights, powers and duties.
- Popular in the offshore community, the limited liability partnership structure has drawn many who are looking to incorporate in Belize. This structure provides companies the flexibility in managing organizational affairs.
- To set up as a limited liability partnership, you are required to have a listed office in Belize. Under the Limited Liability Partnerships Act, you must also keep accounting records for five years to prove with reasonable accuracy at any time the financial position of your company. Subject to the partnership agreement, it is not necessary to appoint an auditor or audit your accounts.
- A flexible corporate vehicle, Belize’s trust funds are unincorporated associations that allow for the legal ownership of the trust assets to be separated from the beneficial ownership. While it is optional to establish trusts with the Belize Registrar, if registered, you will have to submit a certified copy of the instrument creating the trust along with a payment fee. A trust can only be formed for the maximum duration of 120 years from the date of its incorporation.
- This business form is commonly adopted to save on inheritance tax, or to protect and hold assets.
International Business Companies (IBCs)
- A company with limited liability, IBCs are managed by the Belize IBC Act. This popular incorporation choice allows you to be fully exempted from paying any form of tax in Belize. You are also not required to file annual returns, public disclosure of directors, shareholders, charges, loans or agreements.
- Unlike many Belize offshore companies, it is important to note some distinctive differences and features an IBC has. Following the passing of the new legislations, an IBC is allowed to conduct any business activities locally and with persons resident in Belize, own land in Belize and hold shares in domestic companies. You will however be subject to the new economic substance requirements listed above.
Accounting and tax obligations
- Accounting and tax considerations are important factors when incorporating your company. By outsourcing your Belize accounting and tax obligations to Tetra Consultants, you can be confident that you are in the best hands. Our team of consultants will ensure that your firm’s financial statements, corporate tax returns and audits will be completed in a timely fashion without the need for you to travel.
- Additionally, outsourcing your accounting and tax needs to Tetra Consultants will allow you to reduce overhead costs whilst being ensured of timely reporting and filings. Before the start of the engagement, our accounting team will also keep you updated of all the necessary deadlines and expectations. Thereafter, we will prepare all mandated filings in advance to ensure that the stipulated deadlines are met.
Annual reporting requirements
- All Belize-incorporated companies are to maintain their accounting records at their listed office in Belize or at their Agent’s office for a period of minimally five years. The accounting records are to include information regarding the company’s assets and liabilities, sales and purchases as well as monetary transactions. Companies must also prepare financial statements and accounting records in accordance with International Financial Reporting Standards.
- Following the recent changes in Belize’s legislations, IBCs that are physically present in Belize or are carrying out a licensed activity must file monthly business tax returns. You will get to enjoy tax exemptions for income that is below US$37,500. Otherwise, it will be charged at a rate between 1.75% to 19%. Typically, most businesses are taxed at 1.75%, but Tetra Consultants’ team of dedicated accountants will calculate and inform you of your effective tax rate. You will only be liable for taxes if your company’s directors comprises of a person residing in Belize or your company is engaging in a trade, business or profession with the bulk of revenue or income derived from Belize.
Why register a company in Belize?
- The Organisation of American States (OAS) published a report explaining its observations on the 2015 Belize general elections. Its report highlighted that the procedures and systems were generally inclusive with no corrupt practices employed.
- Although Belize attained a score of 87 out of 100 in Freedom House’s 2021 Freedom in The World index, key areas for improvement highlighted include governmental corruption and the high rate of violent crime.
- The recent controversy over the nationalization of Belize Telemedia Limited has also highlighted the extent of Belize’s corruption. Belize Telemedia Limited is heavily indebted but the Belize’s government still continues to ratify the Telecommunications Undertaking Vesting Bill.
- Foreign investors who are looking to incorporate in Belize get to enjoy an easy incorporation process. In fact, company formation is expedited in Belize.
- However, it does not score well on the World Bank’s 2020 Ease of Doing Business Index, being ranked 125th out of 190 countries on the ease of doing business.
- Belize employs an import licensing strategy to protect its domestic producers from external competition. This system damages incentives and even harms resource allocation. Consequently, undermining the transparency of Belize’s trade regime.
- Belize’s official language is English. As the only native English-speaking country in Central America, this will provide you great convenience when handling business locally.
- With the help of the Inter-American Development Bank, Belize is to accelerate its plans of digital government transformation. Through this policy, Belize will be able to leverage on technology and communications technology to modernize government frameworks and infrastructure.
- Government-owned Belize Telemedia Limited only provides telephone, cellular and Internet services to about half of the population. This means that much of Belize’s people still remain isolated.
- As of January 2020, internet penetration in Belize stands at a low rate of 61%. This also means that Belize is not that digitally competitive after all.
- In Belize, banks are mandated and monitored by the law to have a set liquidity ratio. A liquidity ratio refers to the amount of liquid assets a bank holds for a certain percentage of the total value held in the bank at any one time.
- While Belize has scarce natural resources, it continues to adopt renewable-energy technologies to meet its energy demands.
- Belize is the first and only country that has successfully divided all of its territorial waters into different functional fishing waters. As such, this regulates the type of activities that people can conduct in the waters, protecting corals and marine life.
- With the enactment of the Environmental Protection Act of 1992, the act makes relevant provisions for many environmental issues such as wildlife protection, water pollution and waste management, realising the importance of protecting the environment.
Looking to register company in Belize?
- Contact us to find out more about how to register a new company in Belize. Our team of experts will revert within the next 24 hours.
What is the best business in Belize?
- Most domestic industries are limited in size since Belize is one of the most sparsely populated countries. Therefore, most companies operate offshore and sell to non-locals instead.
How much does it cost to start a business in Belize?
- While there are no paid-up capital requirements when starting a business in Belize, Tetra Consultants will recommend setting aside at least US$5,000 as your paid-up capital to fund your overhead expenditures as well as initial deposit for business bank account opening.
- As for Tetra Consultants’ engagement fees, this depends on the exact services required from Tetra Consultants. Our fees are inclusive of government fees and all fees will be clearly stated in our engagement letter prior to the start of the engagement. Tetra Consultants believes in transparency with our valued clients and there are no hidden fees.
What is the currency of Belize?
- It is the Belize dollar (BZ$) which is pegged at a 2:1 ratio to the US dollar.
What do I need to open a bank account in Belize?
- Banks might ask for recommendation letters as a proof of credibility. Tetra Consultants works with an extensive network of banking partners and can secure such letters for you.
Are foreigners eligible to open a bank account in Belize?
- Yes, foreigners are also able to open bank accounts in Belize.
Is the banking system in Belize safe?
- The banking system is closely regulated by the Central Bank of Belize, with frequent audits to ensure compliance with all regulations.
Are foreigners allowed to own land in Belize?
- Yes, foreigners are allowed to have 100% ownership of both land and companies.
How do I find a company in Belize?
What is an IBC in Belize?
- It refers to an International Business Company which is typically chosen by foreigners looking to set up in Belize. IBCs have limited liability and allow you to be fully exempted from paying any form of tax in Belize. You are also not required to file annual returns, public disclosure of directors, shareholders, charges, loans or agreements.
- An IBC, unlike other Belize offshore entities, can conduct any business activities locally and with persons resident in Belize, own land in Belize and hold shares in domestic companies. However, it will be subject to the new economic substance requirements covered above.
How do I set up an LLC in Belize?
- Tetra Consultants’ experienced team can assist you with the process to set up an LLC in Belize. The first step is to decide a unique name for your LLC in Belize, which must include the words “Limited Liability Company” or “LLC”.
- Next, you will have to prepare the necessary KYC documents, including the names of directors and identification proof. Upon receiving all the necessary documents, Tetra Consultants will proceed to draft and notarize the company’s Memorandum and Articles of Association. We will then submit these to the Registry.
- You will also need to have a listed office and reputable agent in Belize. Tetra Consultants will provide you with such services to ensure that you are able to meet these requirements.
- After receiving approval from the Registry, Tetra Consultants will courier the Certificate of Incorporation, Memorandum and Articles of Association and other documents to your preferred address.
- Tetra Consultants will then proceed to open an account with a reputable bank of your choice for your business, as well as assisting you to apply for relevant trade licenses if applicable. We will also provide accounting and tax services to ensure you stay compliant to all requirements.