Let’s compare the conditions offered to foreign entrepreneurs by two jurisdictions: Nevis and the Cayman Islands. This comparison will help you make the best choice when registering an offshore company.
General Information about Nevis
Nevis is an island that is part of the Federation of Saint Kitts and Nevis (SKN). This country is located in the eastern Caribbean Sea within the Lesser Antilles archipelago. Its closest neighbors include Antigua and Barbuda, Montserrat, Sint Eustatius, and Saint Barthélemy.
Key Information about Company Registration in SKN
Optimal Company Type
A Business Corporation (NBCO) is the optimal format for registration in SKN for international tax planning.
Authorized Capital
The law does not regulate the minimum size for the authorized capital of an NBCO, requiring only the issuance of one share, either with or without a nominal value. A typical practice in SKN is to issue 1,000 shares with a nominal value of $1 or no nominal value.
Allowed Shares
The law allows NBCOs to issue any types of shares in any currency.
Activity Restrictions
NBCOs may engage in any commercial activities except for criminal ones. However, to provide banking, insurance, and certain other services, a license is additionally required.
NBCOs are not allowed to conduct commercial activities within SKN, including owning local real estate.
Taxes
NBCOs are completely exempt from all taxes on income earned outside of SKN. The only type of tax for this type of enterprise is an annual state fee of $220.
Company Registration
To register an NBCO on Nevis, you must submit the “Articles of Incorporation” and the company charter to the state registrar. A fee is also paid at the time of registration.
Company Founders
The law requires NBCOs to have at least one shareholder. The use of nominee shareholder services is permitted.
Company Name Restrictions
The law allows owners of NBCOs to name their company in any language that uses the Latin alphabet. However, the registrar may require a translation of the name into English. Names that are identical or similar to those of existing enterprises are not allowed.
The use of certain words in the name (like “bank,” “insurance,” “fund,” etc.) is only permitted if the enterprise holds a license for the corresponding activity.
NBCOs must include a designation of limited liability in their name. Various options are allowed: “Limited,” “Company,” “Corporation,” etc.
Director
The board of directors can consist of any number of individuals, but there must be at least three. For enterprises with one or two shareholders, only one or two directors are allowed, respectively. Both legal entities and individuals can serve as directors. There are no residency or citizenship restrictions for directors.
Secretary
SKN legislation provides for the position of a secretary as mandatory but does not impose residency restrictions.
Meetings of Directors and Shareholders
Meetings must be held at least once a year. There are no restrictions on where the meetings can take place.
Legal Address
The law exempts NBCOs from having a mandatory address in SKN but requires the presence of a registered agent.
Company Opening Timeframes
Establishing a new enterprise on Nevis typically takes about 3-4 weeks.
Financial Reporting and Audit
Saint Kitts and Nevis legislation requires business corporations to maintain accounting records, but there’s no need to prepare and submit financial statements or Annual Returns.
Documents
Only the lists of directors, shareholders, and secretaries need to be kept with the registered agent. It’s not mandatory to inform the agent about any changes in these documents.
Public Information
Information about shareholders and beneficiaries is strictly confidential and not disclosed to the public.
Company Registration in the Cayman Islands
The Cayman Islands (Caymans) is a self-governing overseas territory of the United Kingdom. It consists of three small islands within the namesake archipelago. The nearest neighbors are Cuba, located 240 km to the north, and Jamaica, lying 267 km to the southeast.
Key Information about Company Registration in the Caymans
Enterprise Laws
The activities of enterprises are mainly regulated by the following legal acts:
- “Companies Law” as amended in 2007,
- Amendment No. 2 to the “Companies Law” from 2009,
- Amendment to the “Companies Law” from 2010,
- Commercial Code,
- Law No. 3284.
Optimal Company Type
An Exempt Company is the most suitable format for registration in the local jurisdiction for international tax planning.
Companies of this type are allowed to engage in any activity except those prohibited by law.
Legal Address
Offshore enterprises must have an office and their own registered agent within the country. However, there are no requirements regarding the location of corporate document storage.
Main Taxes
Exempt companies do not pay any taxes.
Company Name
The company name must include a suffix indicating limited liability for shareholders. Various options are allowed—“Limited,” “Corporation,” “Sociedad Anonima,” etc., as well as their abbreviations.
Authorized Capital
The law does not regulate the minimum amount of authorized capital but requires companies to issue at least one share, either with or without a nominal value. Capital can be nominated in any currency, and payment is not mandatory. A typical practice in the Caymans is the issuance of up to 50,000 shares with a nominal value of $1 each.
Types of Shares
Bearer shares are prohibited, but shares without a nominal value can be issued.
Management Structure
An enterprise must have at least one director, who can be either a legal entity or an individual. There are no residency restrictions for directors. The enterprise must also have at least one shareholder.
The law does not regulate the location of director and shareholder meetings.
Financial Reporting and Audit
Exempt companies are not required to maintain accounting records or submit annual reports.
Public Information
Data about the management and owners of the enterprise is strictly confidential and not disclosed to the public.
Double Taxation Agreements
Although the Cayman Islands have about a dozen international agreements to prevent double taxation, exempt companies do not fall under their jurisdiction.
Company Registration
After submitting documents to the registering authority, it typically takes about 1-2 weeks to complete all registration procedures.
Should you register a company in Nevis or in the Caymans? Or should you consider some other jurisdictions? Q Wealth experts will be delighted to help you weigh all the pros and cons that each option has and then make the best choice!
