Gibraltar vs BVI

[Roo]

Hi,

I was wondering which would be better of the two Gibraltar or BVI for zero tax? I see Gibraltar also has low yearly fees and no tax on income not from Gibraltar and not remitted to Gibraltar.
How easy is it to bank a Gibraltar company vs BVI? What about accounting, privacy and other costs? Are expenses strict in for Gibraltar or quite liberal like Singapore/Hong Kong?

 

[daniels27]

Welcome to the community. Have you called any incorporation agent in Gibraltar? Maybe do this first. As far as I know their fees are far from low and audits aren't free too.

BVI is a pain for banking.

Hong Kong is a pain for audits etc.

Singapore and Channel Islands are probably better suited.

 

[Roo]

At least online the fees look to be below 1K GBP per year, not sure if you need extra services which add up.
I have a Singapore company already but I was looking to reduce tax and yearly costs if possible. The SG service provider kind of annoys me lately, quality dropped on their side.

 

[daniels27]

How much are you paying in Singapore?

 

[Roo]

The service provider is around 3.5K SGD per year plus tax which is going to double soon due to the end of startup tax exemption.
I did see in the mean time that there are various other prices for registered office and so on for Gibraltar so probably it adds up to a lot more than shown as the incorporation price to actually have a working/running company.

 

[JohnLocke]

The service provider is around 3.5K SGD per year plus tax which is going to double soon due to the end of startup tax exemption.

I don't know what tax you have to pay once the end of tax exemption but the running costs are low compared to many other jurisdictions you may look at.

 

[Sols]

How easy is it to bank a Gibraltar company vs BVI?

All else being equal, it's slightly easier with Gibraltar than with BVI as Gibraltar is more broadly accepted by some UK EMIs than BVI companies are.

But considering that you're likely looking at the same shortlist of banks/EMIs regardless, the difference is not that drastic.

What about accounting, privacy and other costs?

Gibraltar has a public registry. It's difficult to access, but it's there.

Just in terms of incorporation and management/maintenance, the costs are similar enough you're splitting hairs. Gibraltar tends to be a little more expensive due to less competition than in BVI.

If you need substance, it gets a little more complicated and BVI might end up costing more.

Are expenses strict in for Gibraltar or quite liberal like Singapore/Hong Kong?

Depends on what type of expenses and if you're claiming any relief from them. Generally easy-going, though.

 

[Roo]

I don't know what tax you have to pay once the end of tax exemption but the running costs are low compared to many other jurisdictions you may look at.

Well tax is around 4.5% while you have the startup tax exemption, then goes to 8.5% (that's for under 200K SGD) and the regular tax rate is 17%. My corporate service provider said foreign income not remitted to SG can't be tax exempt unless it was already taxed elsewhere which is why I was looking for something else (BVI/Gibraltar).

 

[daniels27]

Well tax is around 4.5% while you have the startup tax exemption, then goes to 8.5% (that's for under 200K SGD) and the regular tax rate is 17%. My corporate service provider said foreign income not remitted to SG can't be tax exempt unless it was already taxed elsewhere which is why I was looking for something else (BVI/Gibraltar).

Are you sure on that? We had a long discussion recently here and several agents told me otherwise.

 

[Roo]

Are you sure on that? We had a long discussion recently here and several agents told me otherwise.

That's what I've been told and I've found it pretty much written down on the IRAS website too (Companies Receiving Foreign Income under 'Qualifying Conditions for Tax Exemption') It mentions being taxed elsewhere and headline tax rate being at least 15%.

Has someone had different information or experience?

 

[Xshore]

Are expenses strict in for Gibraltar or quite liberal like Singapore/Hong Kong?

Why do you worry about expenses if the tax rate is 0%

That's what I've been told and I've found it pretty much written down on the IRAS website too (Companies Receiving Foreign Income under 'Qualifying Conditions for Tax Exemption') It mentions being taxed elsewhere and headline tax rate being at least 15%.

Has someone had different information or experience?

Many claim that offshore income is not taxable, however very few seems to achieve that in practice.

 

[Roo]

You're right, doesn't matter much if tax rate is zero but I was also curious for Gibraltar of what I can pay on a company card or if I need to distribute dividends to pay for stuff, probably doesn't matter I guess.

I would like to know if it really is not taxable under what conditions because it seems like it must have already been taxed.

 

[daniels27]

That's what I've been told and I've found it pretty much written down on the IRAS website too (Companies Receiving Foreign Income under 'Qualifying Conditions for Tax Exemption') It mentions being taxed elsewhere and headline tax rate being at least 15%.

Has someone had different information or experience?

The 15% etc. related to FSIE. I had a long discussion in the other thread about it. Also the whole tax credits are useless as you are not remitting the money to Singapore.

You're right, doesn't matter much if tax rate is zero but I was also curious for Gibraltar of what I can pay on a company card or if I need to distribute dividends to pay for stuff, probably doesn't matter I guess.

In short only use it for real expense like customs duties, salary, shopping it orders. Why? Because let's say you have this Singapore offshore company and then come with a 5000 dollar dinner in Singapore, you will only have troubles.

I would like to know if it really is not taxable under what conditions because it seems like it must have already been taxed.

It is not taxable unless you remit it to Singapore. Or do the work in Singapore. Just call an agent and ask. I talked to Sovereign.

 

[Roo]

The 15% etc. related to FSIE. I had a long discussion in the other thread about it. Also the whole tax credits are useless as you are not remitting the money to Singapore.

In short only use it for real expense like customs duties, salary, shopping it orders. Why? Because let's say you have this Singapore offshore company and then come with a 5000 dollar dinner in Singapore, you will only have troubles.


It is not taxable unless you remit it to Singapore. Or do the work in Singapore. Just call an agent and ask. I talked to Sovereign.

Expenses for the Singapore company are very 'relaxed', never had an issue paying for things but I assumed they are not the same for companies in other countries (especially in Europe).

Interesting about the agent, I have spoken to my agent about this and they said it had to be taxed elsewhere to be non-taxable. Maybe they are just incompetent and I pay tax because they can't do accounting right, wouldn't be surprised by that either.

 

[daniels27]

Are you living in Singapore or do you have an employment pass?

Expenses at of course relaxed if there is no tax. They are only looking for expenses on Singapore that may render you tax resident. That's why all serious agents will tell you not to have business expenses that are linked to Singapore. And for all others it also does not make sense as it only creates risk at no benefit.

 

[Roo]

Not living in Singapore, no EP.

I visited Singapore yearly at the agents suggestion to be able to get the startup tax exemption and had expense in Singapore for that purpose. I have loads of expenses outside Singapore travel, entertainment, accommodation, absolutely no issues with them and I do pay tax in Singapore as I've been told foreign income isn't tax exempt. Benefit is lowering tax in my case, they said no risk unless expenses are late night, during the weekend or total to over 10% of income.

 

[daniels27]

Do you want my contact at Sovereign? Maybe call them and discuss it they can help you to do offshore.

 

[Roo]

Do you want my contact at Sovereign? Maybe call them and discuss it they can help you to do offshore.

Please share it, I want to hear another opinion too as well as what the costs of other service providers is.

 

[Forester]

Well, just a 2 cents worth question: You are discussing pros, cons and details for Giraltar, BVI and Singapore; however
1) I am missing the information what kind of business is concerned (e.g. you will hardly be welcome in SG with an adult industry project)
2) There are another jurisdictions with 0% tax, it all depends on circumstances. Why just Gibraltar/BVI/SG?

Small remark: Maybe surprisingly, banking for BVI has got better in the last ~1/2 year, it is still complicated but doable, on condition that your business is clear.

 

[Roo]

Well, just a 2 cents worth question: You are discussing pros, cons and details for Giraltar, BVI and Singapore; however
1) I am missing the information what kind of business is concerned (e.g. you will hardly be welcome in SG with an adult industry project)
2) There are another jsurisdictions with 0% tax, it all depends on circumstances. Why just Gibraltar/BVI/SG?

Small remark: Maybe surprisingly, banking for BVI has got better in the last ~1/2 year, it is still complicated but doable, on condition that your business is clear.

1) It's a software development business
2) Please suggest any other option that would be a good fit where banking is easier (with EMI support).

An agent suggested Payoneer and Airwallex for BVI banking but said none of them will offer a company card.