The Cayman Islands is a jurisdiction that is part of the British Overseas Territories, which over the past decades has given the jurisdiction additional stability and prestige.
The main parts of the economy in the Cayman Islands are tourism, offshore bank accounts, and offshore corporations.
Taxation in the Cayman Islands
In the Cayman Islands, there are no taxes on any kind of profit or income, on the payment of dividends, investments, and capital gains. However, the Cayman Islands cannot be called an offshore; rather, it is a mid-shore. The jurisdiction is on the “white list” of the OECD countries, along with the United Kingdom and the United States, and since 2010, has been cooperating with the OECD to achieve full jurisdictional transparency. Regarding the United States, the islands have chosen Model I under the newly introduced FATCA law. This means that the jurisdiction has signed an Intergovernmental Agreement.
The Cayman Islands are an example for other tax-free jurisdictions how to integrate new global trends and not lose their popularity.
Requirements for companies in the Cayman Islands
Before registering or buying a company in the Cayman Islands, you need to know the following aspects:
Share capital
There is no requirement for a minimum share capital on the islands, while the standard amount for registering a company is a share capital of 50,000 shares without specifying the par value, and without the need to pay the share capital. The shares of your company in the Cayman Islands can be owned by both an individual and a legal entity.
The name of the company
Everyone knows and understands the importance of choosing a company name, however, each jurisdiction has several rules that must be followed. The name of a company in the Cayman Islands must end with (or their abbreviation): Limited, Corporation, Incorporated, Societe Anonime, and Sociedad Anonima.
Company reporting
Although exempt companies in the Cayman Islands are not considered offshore, the reporting requirements are very similar to offshore jurisdictions in their flexibility. Thus, the Cayman Exempt Company is exempt from filing any financial statements, however, companies must maintain accounting records that reflect the financial position of the company. Such reports can be stored in any form anywhere.
These requirements allow the jurisdiction, for any request within the framework of tax transparency from any foreign jurisdiction, to verify any of the registered companies in the Cayman Islands. Besides, companies must submit an annual report every January that confirms that:
- The Memorandum and Articles of Association have not been changed;
- The company does not operate on the islands;
- As well as confirmation that the company complies with local laws.
In addition to the above reporting, the company’s obligations include an annual fee for keeping the company active. If the company has not paid the duty within a year, then after 1 year from the date of payment of the duty, the company is automatically deleted from the Cayman Islands Companies Register, and all assets of the company are transferred to the government.
The procedure of opening a company
For incorporating the Cayman Exempt Company in the Cayman Islands includes 3 steps:
Step 1
The first and foremost step is your intention to incorporate the Cayman Exempt Company in the Cayman Islands. To do this, you need to contact us by email or messengers.
Step 2
Following the service agreement, you must pay a commission for the services provided and assistance in registering the Cayman Exempt Company in the Cayman Islands, which you pay by card, through PayPal, or by bank transaction. The commission is from 4500 USD.
Step 3
After you have paid the commission, the process of preparing the documentation begins.
To register a Cayman Exempted Company in the Cayman Islands, individuals will need the following documents:
- A completed application;
- A notarized copy of your passport;
- Proof of residential address (utility bills);
- A notarized copy of your utility bill or bank statement to prove your residential address;
- Reference Letter from the bank and a professional (notary, certified accountant, etc.) for all Directors / Managing Directors / Owners of the company – (desirable but not required);
- Letters of recommendation must be no older than 3 months and issued by financial institutions with which the client has had a relationship for at least 2 years; the type and status of the relationship must also be described;
- Contact information, i.e. an address where we can send your company documents in the Cayman Islands.
For legal entities
- A notarized copy of the share certificate;
- A notarized copy of the Power of Attorney;
- A notarized copy of the minutes of the general meeting and the charter of the legal entity/structure;
- Samples of signatures of the owners of the company.
- A notarized copy of the Certificate of Incorporation of the company / Certificate of Good Standing (if the company has existed for more than 1 year).
- Takeover letter (applicable in case of bearer shares). (Letter of undertaking).
- Certificate of Shareholders/subscribers.
- Appointment of directors by the founders of the company (Subscribers appointment of the company’s director / s).
- Documents (specified in the section for individuals above) of at least two directors (if there are more than one director) and shareholders holding more than 10% of the company’s shares.
Note: all documents must be translated into English and notarized.
The term for registering a company after submitting all documentation takes three to four working days.
