Corporate Income Tax Rate        (%)0 

Capital Gains Tax Rate                 (%)0 

Branch Tax Rate                           (%)0 

Withholding Tax                           (%)0

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TAXES ON CORPORATE INCOME AND GAINS​

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The BVI Business Companies Act, 2004 (BVI BC Act) entered into force on 1 January 2005. Under the BVI BC Act, companies incorporated under the British Virgin Islands (BVI) Companies Act are exempt from all taxes provided under the BVI Income Tax Ordinance. The BVI BC Act is essentially an amalgamation of the International Business Companies (IBC) Act and the BVI Companies Act, which contained a regime under which all domestic companies incorporated in the BVI were governed. In addition, on 1 January 2007, all International Business Companies on the companies register in the BVI were automatically reregistered under the BVI BC Act and, consequently, the IBC Act was repealed in full.

 

All Business Companies (BCs) are statutorily exempt from BVI taxes. However, such companies must pay an annual license fee (see Section C). In general, a BC may not transact business with persons resident in the BVI or own interests in real property located in the BVI unless it obtains the relevant trade license from the BVI government. In addition, a BC may not carry on business as a bank, trust company, insurance company or reinsurance company without a license from the BVI Financial Services Commission.

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TAX TREATIES

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Although the United Kingdom’s double tax treaties with Japan and Switzerland have been extended to the BVI, these treaties are not used in practice. The BVI has not entered into any other tax treaties. However, the BVI has entered into 28 tax information exchange agreements with various jurisdictions, including Canada, China, Japan and the United States, and with 16 European countries, including France, Germany, Ireland, the Netherlands and the United Kingdom.

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On 28 November 2013, the BVI and the United Kingdom signed an intergovernmental agreement (IGA) to enable the exchange of information for tax purposes, including on an automatic basis.

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On 30 June 2014, the BVI and the U.S. Treasury signed and released a Model 1 IGA for the implementation of the US Foreign Account Tax Compliance Act (FATCA).

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All BVI institutions must comply with FATCA and UK Crown Dependencies and Overseas Territories (CDOT) regulations. In addition, if required, they must report to the BVI International Tax Authority via the authority’s Automatic Exchange of Information website. As a result of the introduction of the Common Reporting Standard (CRS; see below), it is expected that the requirement for reporting in compliance with the above-mentioned UK CDOT regulations will no longer be needed after 2017.

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The BVI was an early adopter of the CRS. The BVI recently issued its initial CRS regulations, which took effect on 1 January 2016. The first reporting for the 2016 tax year was due by the end of July 2017. The expected deadline for future years is 31 May. All BVI institutions must comply with the CRS.

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The content is based on information current as of 1 January 2018, unless otherwise indicated in the text of the chapter. Changes to the tax laws and other applicable rules in various countries covered by this publication may be proposed. Therefore, readers should seek independent tax advice from their local and international firms to obtain further information.

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This publication contains information in summary form and is sourced from the Ernst & Young Worldwide Corporate Tax Guide, and is therefore intended for general guidance only. It is not intended to be a substitute for detailed research or the exercise of professional judgment. Neither Aston & Willson LLP or EYGM Limited nor any other member of an organization can accept any responsibility for loss occasioned to any person acting or refraining from action as a result of any material in this publication. On any specific matter, reference should be made to the appropriate advisor.