Cayman Islands Tax Haven


Cayman Islands Tax Haven

KGN Services specializes in Cayman Islands Company Registration and opening bank accounts.

Advantages of Forming a Company in the Cayman Islands Tax Haven

The Cayman Islands is a British Overseas Territory consisting of three islands located to the south of both Florida and Cuba located in the western portion of the Caribbean. It is conveniently located and easy to access via international air travel from any point in the globe. This British possession houses the fifth largest banking sector on the planet. With a total population of only 60,000 inhabitants, the Cayman Islands is home to over 580 banks, including major branches from the four largest banking institutions in the world. This has brought to the Cayman Islands a fast and modern telecommunications system, inclusive of modern cellular networks and high-speed internet connectivity. It is regarded by the international community as a safe and stable tax haven.

This level of recognition at the international level is due to the fact that the Cayman Islands tax haven has a very stable political environment and has laws that are very friendly to foreign investment as well as to the protection of privacy. Additionally, it is a nation that has English as its formal language. This makes communication and understanding legal documentation quite simple. Couple all of this to the additional fact that the Cayman Islands judicial system is based on English common law, and you can see why the Cayman Islands tax haven is so popular with companies and individuals eager to protect and preserve their wealth worldwide.

The Primary Advantages of a Cayman Islands Tax Haven

The Cayman Islands does not impose any tax burden on income, capital, sales or capital gains. There are no withholding taxes of any variety in the Cayman Islands. Neither are there inheritance taxes. This makes it an ideal location to establish an offshore company for the purposes of mitigating tax exposure. A company formed within the Cayman Islands tax haven can also be used as a flexible tool for sound estate planning.

Currency exchange controls in the Cayman Islands are non-existent. That means that as a foreigner, once you establish an offshore company within the Cayman Islands tax haven, you are free to conduct your operations and transfer money internationally, inbound and outbound, in any amount and currency that best suits your needs. You do not have to worry about government interference, regulations or limitations regarding currency transfers.

Those who prefer to straightaway get information on how to form a company in the Cayman Islands tax haven should click here.

Practicality of Forming an Offshore Company Within the Cayman Islands Tax Haven

Aside from the overwhelmingly positive elements already mentioned that establish the Cayman islands as an internationally recognized and safe tax haven, there are also more direct and individualized reasons why forming an offshore company in the Cayman Islands is highly advantageous.

Unlike other tax havens, there is no need to concern yourself with annual reporting requirements in the Cayman Islands tax haven. There is also no legislation or regulatory requirement that ever mandates auditing of an offshore company established in the Cayman Islands. Financial records may be kept. if so desired, but the primary owners are not obliged to keep them on the Cayman Islands. They may be stored and maintained anywhere on the planet. This is of extreme value for those companies and individuals that seek to maximize their privacy.

The structuring requirements for an offshore company in the Cayman Islands tax haven offers a large degree of simplicity. Only one shareholder and one director is required for its formation. These two positions are allowed to be carried out by the same person. The person that functions as shareholder and director can be an individual or a moral entity, such as a a corporation, partnership or trust. There is also no residency requirement for either the shareholders or the directors. This means that they can reside anywhere on the globe and be of any nationality. Furthermore, the Cayman Islands does not impose a minimum authorized capital requirement for offshore companies when they are formed. This means that the offshore company in the Cayman Islands tax haven can be formed with as little or as much capitalization as deemed necessary by the primary owners.

For those individuals that require even more reassurance than that already provided by the high levels of stability and convenience offered by a Cayman Islands tax haven, there is the following added benefit. When an offshore company is formed in the Cayman Islands, a certificate can be obtained from the government that guarantees the tax-free status of the newly formed company for a full twenty years from the date of formation. Even though, as described earlier, the Cayman Islands currently has no taxes, this guarantee assures those entities forming the offshore company that even if tax laws were to change, their newly formed company will remain tax exempt. This adds a degree of reassurance pertaining to the tax-free status of the Cayman Islands tax haven that is not found in any other tax haven in the world. It literally guarantees tax free status for the offshore company.

Who Can Benefit From a Cayman Islands Tax Haven Company?

Ongoing Businesses

Those individuals and companies that generate continuous income from a commercial enterprise would benefit greatly by forming an offshore company in the Cayman Islands tax haven. As all of the income generated by the offshore company would be free from taxes, it is an excellent vehicle for mitigating tax exposure. The profits can remain in the bank accounts held by the offshore company and routed to other offshore companies, trusts or individuals as needed. In most jurisdictions, only the actual funds that are repatriated to the primary owners in their country of residence would be exposed to whatever local tax rates they are subject to paying. Of course, the income generated by the offshore company in the Cayman Islands tax haven need not ever leave the safety of the Cayman Islands tax free zone. The primary owners can purchase real property anywhere in the world, or maritime and aviation vessels and register them to the Cayman Islands offshore company.

Shielding Intellectual Property

Entities or individuals that own intellectual property can also benefit greatly from an offshore company in the Cayman Islands tax haven. The intellectual property assets can be held by the offshore company and licensed out for use by clients or other companies controlled by the primary owners. As such, all income generated by the intellectual property would be tax free. This mechanism is ideal for authors, musicians, software developers and individual freelancers. This model can even be expanded to include those companies that are service-based. Design, graphics, platform development and consulting can be commercialized using a licensing model as opposed to a per service fee.

Those Seeking Practical Estate Planning

An offshore company within the Cayman Islands tax haven is also well suited for those seeking a mechanism for estate planning that allows for precise control of who inherits their property. It also allows for tax mitigation throughout the entire inheritance process. This can be accomplished by using a variation of the offshore company known as a trust. The Cayman Islands tax haven is well suited to accommodate foreign owned companies as well as foreign held trusts. The property and other assets that the primary owners wish to convey to their selected beneficiaries can be placed in the trust. A simpler way to obtain a similar result is simply by making the intended beneficiaries shareholders in the offshore company. Through the Cayman Islands tax haven there are a multitude of ways to accomplish effective estate planning.

Shielding Investment and Trading Accounts

Whether they are a long-term investor or an active day trader, capital gains and other punitive taxation schemes found in the majority of countries can cut deeply into their profits. An offshore company formed in the Cayman Islands tax haven is the perfect vessel for eliminating this burden. The offshore company can be formed and used to open the brokerage and trading accounts that are required. By this method, the primary owners are shielded from capital gains taxes.

Shielding Assets

An offshore company in the Cayman Islands tax haven can also be used to shield assets from potential confiscation by creditors or other civil claimants. Only courts in the Cayman Islands can seize assets from a Cayman Islands company. No other court, from any other nation in the world has jurisdiction over any asset held in the Cayman Islands. The court system in the Cayman Islands tax haven does not have any legislation that allows civil forfeitures. As such, even in the unlikely event that a claimant on the assets of the primary owner were to discover that assets are being shielded in the Cayman Islands, they would have no recourse open to them to attempt any form of asset recovery or confiscation. The Cayman Islands tax haven is one of the most secure locations on the planet to shield assets.

Forming an Offshore Company in the Cayman Islands Tax Haven

In the Cayman Islands, the Companies Law, originally passed in 1961, governs all aspects of company formation. What is commonly referred to as an offshore company in the Cayman Islands is known as an “exempted company.”

Such companies can be formed without the primary owners ever having to visit the Cayman Islands. The process can be handled by a registering agent and be done within a time frame that can be measured in days. The formation of the company is done through a document known as the “memorandum and articles of association.” This document includes the following information:

A name must be selected for the exempted company. It does not require the inclusion of the word “limited” or “ltd.” It is a good practice to have two or three variations of your desired name in case one of the names is already taken or otherwise unavailable. The name can be in any language, provided that it uses the Latin alphabet.

The authorized capital for the exempted company must be declared. There is no minimum or maximum for this figure. It also only has to be declared, it does require actual presentation. It is recommended that the initial authorized capital declared at the formation of the company does not exceed $50,000 USD. This is due to the fact that capital levels at or below this mark are assessed the lowest annual government licensing fee for companies. That licensing fee is the only expense associated with owning and operating an exempted company.

An objects clause must be provided. This describes the nature of the business or operation that the company will be engaged in as the purpose for its existence. This can be very specific, or it can be written broadly enough to basically cover any legitimate business activity that could be undertaken. The registering agent can assist in the verbiage of the objects clause.

Once the exempted company is formed, it may apply to receive its Certificate of Tax Exemption. This is the official government document that guarantees that the company will be exempt of all taxes for a period of twenty years even if in that time tax laws were to change in the Cayman Islands.

With a long standing stable government, a sound legal system, established legislation friendly to foreign investment and a zero tax rate structure, the Cayman Islands tax haven is undoubtedly the premiere location to form an exempted company. Suitable for a variety of purposes ranging from tax mitigation, to estate planning, to asset shielding and more — the Cayman Islands tax haven ranks at the top for those seeking privacy, safety and efficiency.

Cayman Islands Company Formation Prices

Cayman Islands Company Formation Package Includes:

  • Company Name Check
  • Initial Business Approval
  • Preparation of Application Documents
  • Company Registration Fee
  • Registered Office Address for 1 year
  • Registered Agent Services for 1 year
  • Government filing fee
  • Certificate of Incorporation
  • Memorandum & Articles of Association
  • Minutes of first meeting appointing the director(s)
  • Share Certificate(s)
  • Register of shareholders
  • Register of directors

Starting at: $2990

Why Choose KGN Services?

We’ve been helping business owners since 1996

Incorporating your business is our focus

We make a complex process fast and easy

We work closely with Companies Registries to guarantee our service

Fastest offshore companies & accounts – Most competitive pricing worldwide

Services in the Cayman Islands Tax Haven

KGN Services provides the following services in the Cayman Islands:

  • Cayman Islands Company Formation
  • Registered Office and Agent Services
  • Cayman Islands Company Secretarial Services
  • Nominee Shareholder / Nominee Director
  • Opening of Bank Accounts in Cayman Islands
  • Full Belize Company Administration Services
  • Mailing Address in the Cayman Islands
  • Virtual Office in the Cayman Islands
  • Trademark Registration
  • Yacht Registration

Cayman Islands – General Information

Location: Caribbean, three-island group (Grand Cayman, Cayman Brac, Little Cayman) in Caribbean Sea, 240 km south of Cuba and 268 km northwest of Jamaica.

Area:total: 264 sq km, land: 264 sq km, water: 0 sq km. 

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Natural resources: Fish, climate and beaches that foster tourism.
Population: 58,441, most of the population lives on Grand Cayman (July 2017 est.).

Capital: George Town (on Grand Cayman).

Time Zone: UTC−5.

Languages: English (official) 90.9%, Spanish 4%, Filipino 3.3%, other 1.7%, unspecified 0.1% (2010 est.).

Government type: Parliamentary democracy (Legislative Assembly); self-governing overseas territory of the UK.

Legal system: English common law and local statutes.
International organization participation: Caricom (associate), CDB, Interpol (subbureau), IOC, UNESCO (associate), UPU.
Economy: With no direct taxation, the islands are a thriving offshore financial center. More than 65,000 companies were registered in the Cayman Islands as of 2017, including more than 280 banks, 700 insurers, and 10,500 mutual funds. A stock exchange was opened in 1997. Nearly 90% of the islands’ food and consumer goods must be imported. The Caymanians enjoy a standard of living comparable to that of Switzerland. Tourism is also a mainstay, accounting for about 70% of GDP and 75% of foreign currency earnings. The tourist industry is aimed at the luxury market and caters mainly to visitors from North America.

Currency: Caymanian dollar (KYD).

KGN Services | Cayman Islands Tax Haven

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