This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. Find out more here.  
Lawandtax-news.com favicon LAWANDTAX-NEWS.COM
HOME | CONTACT | RECRUITMENT | ABOUT | LEGAL | PRIVACY & COOKIES Join us on Twitter Lowtax Facebook page Join our discussion on LinkedIn Join us on Google+ Delicious Subscribe to the Tax-News RSS Feed
   LOWTAX   
   TAX-NEWS   
   
 

Contributions

Articles »

Country Home Pages

Australia
Bahamas
Barbados
Bermuda
British Virgin Islands
Canada
Cyprus
Dubai
Gibraltar
Guernsey
Hong Kong
Isle of Man
Ireland
Jersey
Labuan
Liechtenstein
Luxembourg
South Africa
UK
US

Daily Tax Quote

Lowtax Network Sites
Lowtax Network Portal: 'Low-tax' business and investment in the top 50 jurisdictions covered in exceptional detail.
Tax News: Global tax news, continuously updated through the day.
Expat Briefing: A free online publication serving international expatriates and featuring world news, forums, events, in-depth country information and reliable investment and personal taxation guides.
Law & Tax News: Daily news and background data on tax and legal developments for international business.
Offshore-e-com: A topical guide to offshore e-commerce focused on tax and regulation.
Lowtax Library: One of the web's largest and most authoritative business and investment information sources.
US Tax Network: The resource for free online US taxation information, covering: corporate tax, individual tax, international tax, expatriates, sales and e-commerce tax, investment tax.
Offshore Trusts Guide: OTG publishes news, features and newsletters on the use of offshore trust structures.
TreatyPro: Online tax treaty resource.
Global Incorporation Guide [GIG]: A BSI / Lowtax Network international business smart tool.
BRITISH VIRGIN ISLANDS
LINKS IN THIS SECTION
INCOME TAX
TAXATION OF TRUSTS
WITHHOLDING TAX
RELATED INFORMATION


Direct Corporate Taxation

 

In the British Virgin Islands there is no capital gains or capital transfer tax, no inheritance tax, and no sales tax or VAT. There are stamp duties on certain transactions, and property taxes.

In September 2002, then Chief Minister and Minister of Finance, Ralph T O'Neal confirmed that the government was seriously considering the abolition of both personal and corporate income tax on the Islands. Although he explained that no pressure had been brought to bear on the BVI government to impose a zero rate of income tax, as it stood, the jurisdiction's tax regime could have come under fire for 'ring-fencing' certain tax advantages; one of the criteria laid out by the OECD for defining 'harmful preferential tax regimes'.

In October 2004 former Chief Minister Orlando Smith informed the country’s Legislative Council that a two-year transition period would be put in place to smooth the changeover to the Business Companies Act, which has lowered the income tax rate to 0% for both local and International Business Companies.

The new legislation, which took effect on 1st January 2005, was drafted to ensure the territory is fully compliant with the European Union (EU) Savings Tax Directive and EU Code of Conduct on Business Taxation, as required by the United Kingdom of all its Overseas Territories.

Under the transition arrangements announced by Dr Smith, new incorporations were still possible under old legislation throughout 2005. From 2006, new incorporations were made under the new Business Companies Act, although companies already on the register were permitted to operate under the old IBC Act or Companies Act for an additional year. Since 1st January 2007, all companies are operating under the new legislation.

Under the new legislation, the existing income tax system for employees disappeared. However, in its place, a payroll tax is levied at a rate of 14%, 8% of which is paid by the employer and the remainder by the employee, although the first $10,000 of income is tax free. The contribution for small business, defined as those employing less than seven people and with a payroll of less than $150,000 per year, is 10%.


British Virgin Islands Income Tax

Income tax (now abolished) was levied on the chargeable income of resident BVI Companies Act Companies. As applied to a company, 'resident' meant that the management and control of its business was exercised from the BVI. Normally, if more than half of the directors are resident in the BVI, then so is the company. There were three possible cases:

  • the company was resident, in which case it paid income tax of 15% on its world-wide chargeable income;
  • the company was non-resident, in which case it paid 15% income tax on its chargeable income arising in or remitted to the BVI; or
  • the company was resident but was an 'offshore trading company', meaning that 90% of its profits arise from activity conducted outside the BVI, and it paid tax at the rate of 1% on its world-wide income.

Chargeable income was assessed after deduction of expenses; tax credits were allowed on foreign tax paid in treaty countries and certain other countries.

BACK TO TOP


British Virgin Islands Taxation of Trusts

Trust income is exempt from tax if:

  • the trust is created by or on behalf of a non-resident person; and
  • owns no land in the BVI; and
  • does not carry on business in the BVI.


British Virgin Islands Withholding Tax

There are no withholding taxes in the BVI. However, the BVI, like other British 'dependent territories', was forced to apply the EU's Savings Tax Directive from 1st July, 2005, and chose to apply a withholding tax (initially of 15%, rising to 20% post July 1, 2008 and to 35% in 2011) to the returns on savings paid to nationals of EU Member States. The Directive does not apply to corporate entities.

BACK TO TOP


LINKS IN THIS SECTION
INCOME TAX
TAXATION OF TRUSTS
WITHHOLDING TAX
RELATED INFORMATION

 

THE LOWTAX LIBRARY

One of the web's largest and most authoritative business and investment information sources. Alongside topical, daily news on worldwide tax developments, you can receive weekly newswires or access up-to-date intelligence reports on a range of legal, tax and investment subjects.

FREE TRIAL NEWS SUBSCRIPTION

Our 16 constantly updated intelligence reports cover every important aspect of 'offshore' and international tax-planning in depth, including banking secrecy, the EU's savings tax directive, offshore funds, e-commerce, offshore gaming and transfer pricing. Reports are available for immediate downloading or as subscription services with news pages.

Advertising & Marketing

With over 50,000 qualified readers every month our web-sites offer a number of cost effective, targeted advertising, sponsorship and marketing opportunities:

Display advertising - from 'skyscrapers' to 'buttons'
Content/article submission and sponsorship
Opt-in email marketing
On-line Services Directory listings

Click here to learn more or contact Charles Bell on +44 (0)1424 205 425 or at charles@bsi-media.com and he will put you in touch with your regional rep.

News & Content Solutions

Could your corporate web-site or newsletter benefit from incorporating regularly updated news and content tailored to serve your clients' interests? We can provide a variety of maintenance-free news and content solutions that can be seamlessly integrated and dynamically delivered:

Customised, personalised 'own-brand' news services
Newsletter content and management
News Headlines Tickers

Click here to learn more or contact Charles Bell on +44 (0)1424 205 425 or at charles@bsi-media.com and he will put you in touch with your regional rep.

Important Notice: Wolters Kluwer TAA Limited has taken reasonable care in sourcing and presenting the information contained on this site, but accepts no responsibility for any financial or other loss or damage that may result from its use. In particular, users of the site are advised to take appropriate professional advice before committing themselves to involvement in offshore jurisdictions, offshore trusts or offshore investments.

All rights reserved. © 2017 Wolters Kluwer TAA Limited


All content on this site has been provided by BSIRN.