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CAYMAN ISLANDS COMPANY REGISTRATION
Registering a company in the Cayman Islands is a popular choice amongst investors. Located in the Caribbean Sea, the Cayman Islands are a British overseas territory.
The Cayman Islands’ territory is divided into three sections. These islands are Little Cayman, Cayman-Brac, and Grand Cayman.
The Cayman Islands are known now as a thriving offshore financial hub throughout the world. On the islands, there are already several tens of thousands of registered businesses.
Additionally developed, there are roughly 500 established banks in the financial industry. Offshore registration in the Cayman Islands offers a genuine chance to conduct and grow a successful international business. The Cayman Islands are becoming more attractive for business.
KEY REQUIREMENTS FOR COMPANY FORMATION IN CAYMAN ISLANDS
TIMELINE OF CAYMAN ISLANDS COMPANY INCORPORATION
4 to 6 weeks
A company must have a registered office in the Cayman Islands. This is the official address where all correspondence will be sent.
Every company registered in the Cayman Islands must have a resident agent. The resident agent is responsible for maintaining the company’s register and ensuring that the company complies with local laws and regulations.
A company must have at least one director who is a natural person. The director can be a resident of any country, and there is no requirement for them to be a resident of the Cayman Islands.
A company must have at least one shareholder, and there is no limit to the maximum number of shareholders. The shareholder can be a natural person or a corporate entity.
Authorised Share Capital
The Cayman Islands company formation requires no minimum authorised capital shares.
TYPES OF BUSINESS ENTITIES FOR CAYMAN ISLANDS COMPANY INCORPORATION
- Limited liability company – A foreign entity may register as an LLC if the primary location of the company’s operations is abroad. The company’s obligations and liabilities cannot be applied against executives, managers, or shareholders personally.
- Resident company – A typical resident business operates within the Cayman Islands. The business needs to register its former and current members and maintain a physical office presence. The Registrar must receive a yearly report from a resident corporation.
- Non-resident company – A firm that has no intention of doing business in the Cayman Islands is referred to as a non-resident company. However, businesses are allowed to purchase and sell shares in exempted companies and overseas corporations. This business can only operate on the island in collaboration with a local organization.
- Overseas Company – A corporation incorporated outside of the Cayman Islands is referred to as an offshore company (or foreign firm). These companies have the option of registering as foreign corporations, which grants them the right to own property, carry on business, or participate as partners in a limited partnership that is exempt from taxation in the Cayman Islands.
- Exempt Company – This kind of Cayman Islands company formation is appropriate for businesses whose primary operations are offshore or outside of the Cayman Islands. In the Cayman Islands, an exempt company is not required to hold annual general meetings or register its members for public inspection.
OTHER INFORMATION ABOUT CAYMAN ISLANDS
- Taxes – Both the corporation and the shareholder are exempt from taxes on profits and payouts to shareholders as well as the exchange of shares. Taxes are not being withheld. Transfers of business shares are also exempt from estate, gift, and inheritance taxes.
- Annual Fees – According to the current Cayman Islands Registrar of Companies fee schedule, annual registration fees for Cayman Islands firms are $750 USD. There are additional costs associated with the registered agent.
- Public Records – The Register of Directors and Officers and the Register of Shareholders records are not open to the public. In the Cayman Islands, shareholder and director names are kept confidential.
- Accounting and Audit Requirements – In the Cayman Islands, yearly returns must be filed. Corporations are not required to disclose financial documents with their yearly filings, nevertheless.
- Annual General Meeting – In order to conduct business in the Cayman Islands, corporations must hold an annual general meeting. Companies can hold these meetings anywhere in the world; they are not required to take place locally.
DOCUMENTS REQUIRED FOR CAYMAN ISLANDS COMPANY FORMATION
- Certificate of incorporation
- Memorandum of Association
- Articles of Association
- Minutes of the First Meeting of Directors
- Register of Directors and Officers
- Register of member
- Share Certificates
PROCESS OF REGISTERING A BUSINESS IN THE CAYMAN ISLANDS
STEP 1: REGISTERING THE COMPANY NAME
A business only needs to register its legal, trademarked name with the Cayman Islands General Registry for offshore organizations. To confirm that their company name is available for use, foreign businesses that register as resident corporations must do a search with the General Registry.
STEP 2: SUBMITTING THE APPLICATION
The applicant must prepare and submit the required documents listed above along with the filled-out application.
The incorporation application is processed on average between 6 to 10 working days.
The applicant must pay the incorporation fee.
STEP 3: OPENING A CORPORATE BANK ACCOUNT
Filling out an extensive application form and providing company information are required in order to open a corporate bank account in the Cayman Islands.
These documents include your most recent Certificate of Incorporation, a written request to open a new account on company letterhead describing the need for such an account, and a reference from a Caymanian or foreign bank.
Some banks need identification and references from the directors and officials in charge of the account as well as the primary shareholders who control 10% or more of the shares.
PROS AND CONS OF REGISTERING A BUSINESS IN CAYMAN ISLANDS
Entrepreneur do not need to submit their personal documents with the Cayman Islands government. The lack of a requirement for meeting minutes, shareholder meetings, or even annual audits is another example of how the Cayman Islands maintain strict confidentiality over all of the Company’s information.
There is no share transfer tax
There is no tax or stamp duty when transferring shares to a third party. However, the business owner would be responsible for paying stamp duty and taxes if the shares are somehow connected to real estate transactions.
Less capital requirements
There is no minimum capital requirement for company registration in the Cayman Islands, unlike some other nations that need a sizable deposit in a bank or escrow before moving forward with the process.
Permission for Mergers
The entrepreneur’s company may merge with other companies in this territory. The ultimate merger may occur either at that company or in another country.
Limited access to resources and capital
Business owners in the Cayman Islands frequently don’t have resources and capital. This could make it harder for them to raise money for their operations and limit the amount of money they have to utilize to launch their own company.
In the Cayman Islands, business owners frequently struggle to expand the reach of their goods or services. This can result in lower profitability and less market success.
High cost of doing business
Companies operating in the Cayman Islands face high expenditures for a variety of standard expenses like marketing and personnel training. This may result in a decrease in the company’s overall profitability.
WHY CHOOSE RELIN CONSULTANTS TO INCORPORATE A COMPANY IN THE CAYMAN ISLANDS?
Using a professional service provider such as Relin Consultants can help ensure that the incorporation process is completed efficiently and accurately and can provide ongoing support with compliance and administration requirements. We prepare and take care of submitting all the required documents for the incorporation process.
Additionally, we provide guidance on the most appropriate type of company structure for your needs.
Reach out to us at Relin Consultants for our Cayman Islands incorporation services.
What steps are involved in forming a business in the Cayman Islands?
The Cayman Islands’ business registration procedure involves selecting the company structure, reserving the name, filling out the application, submitting the required paperwork, finishing the registration process, and creating a bank account.
What are the advantages of registering a company in the Cayman Islands?
The Cayman Islands’ company registration has the following advantages: Shares Transfer Tax is not applicable, mergers are permitted, there are lower capital requirements, there is stability, and registration is completed quickly.
Is the taxation structure in the Cayman Islands beneficial to the businesses that are registered there?
Yes, the taxation is quite favorable to businesses registered in this location. The Cayman Islands, unlike the majority of other nations, don’t typically levy a company tax, making it a perfect place for foreign enterprises to set up business or hide their income from taxes.