Seychelles Incorporation Benefits

Favorably and strategically located in the Indian Ocean, enjoying political stability and adequate legal and administrative frameworks, today Seychelles is becoming one of the most attractive offshore jurisdictions. It is highly recommended for those looking for an efficient and secure offshore company structure.

Let us define the most attractive features of this jurisdiction and discuss how anyone can benefit from incorporating an offshore company in the Seychelles.

Seychelles entered the offshore financial services industry in December 1994, following the enactment of the International Business Companies Act 1994 and other laws. Despite its small size and some other limitations, the Seychelles offshore sector had managed to succeed in recent decades. More than 30,000 Seychelles International Business Companies (IBCs) have been registered, and more than 600 new offshore companies are registered every month.

As a relative newcomer to the offshore industry, Seychelles has a greater number of company names available than other jurisdictions. Seychelles IBC benefits from zero local taxes, very few restrictions or reporting requirements, and superior confidentiality. It remains competitive even in the face of increased OECD enforcement and pressure from other highly respected offshore centers. The Seychelles government is increasingly encouraging foreign investment through the development of the International Business industry. This strategy encompasses IBC registration, offshore trade zones, ship and aircraft registration, as well as banking and insurance.

Below is a synopsis of the key positive facts that make a Seychelles IBC one of the safest and most tax efficient structures in the world.

1. Seychelles IBC is not taxable within Seychelles. You only pay the Government License fee. The law states that all exemptions for a Seychelles IBC will remain in force for a period of 20 years from the date of incorporation;

2. Incorporation fees are fixed for life. Even if the annual renewal fees increase in the future, a business incorporated before the increase took effect will not be adversely affected. However, if the rates were reduced, the same company would be entitled to pay the reduced amount;

3. There is no obligation to file and submit any type of accounts or annual statements. However, if they are retained, an audit is not required. This certainly makes it easy to set up and operate an IBC;

4. There is no minimum share capital requirement and the capital may be denominated in any currency. Shares can be issued with or without value;

5. Seychelles IBCs can be established with bearer shares that do not have the name of the beneficial owner on record. It is possible to make use of Sunday directors. That means that said business structure is private and confidential;

6. Corporate directors are allowed when creating the company;

7. Only one shareholder and one director are required, and both may be the same person. Their details do not appear in any public record;

8. Shareholders, directors and officers need not be Seychelles residents and there is no stipulation as to their nationality;

9. Meetings of shareholders and directors do not need to be held in the Seychelles, a representative may attend, telephone meetings are possible. There is no requirement for an ordinary Annual General Meeting;

10. The Deed of Incorporation and the Articles of Association are the only documents that will be kept in the public registry. These documents do not contain any indication of the actual shareholders or beneficial owners;

11. No currency or other financial controls are imposed;

12. Seychelles IBCs are low cost with an annual license fee of just $100 for authorized share capital up to $100,000 ($1,000 for authorized capital over $100,000);

13. Quick onboarding procedures and simple ongoing administration. The new IBC is usually onboard within 24 hours;

14. The anniversary of the rate is 12 months from the incorporation, not December 31;

15. IBCs may engage in any legal business in any country and may transact in any currency they choose;

16. Although a locally established IBC cannot trade within the Seychelles, it can do business with any other Seychelles IBC, it can be used to own or manage a yacht or private aircraft that is registered in the Seychelles, for example;

17. In fact, local legislation allows the migration of companies that are already registered in other jurisdictions, which can be particularly useful;

18. Seychelles is not subject to the EU Savings Tax Directive, unlike other offshore tax havens;

19. Seychelles has avoided entering into information sharing agreements with foreign countries or organizations for the exchange of financial assistance;

20. Not highlighted by OECD;

21. Not yet widely perceived as a tax haven;

22. There is a continuous expansion of the Double Taxation Treaty network. Being a newcomer to the tax treaty network, you are entering into treaties, which are most relevant to the needs of the new century;

23. Signatory of the Hague Convention (1961) for the Apostille.

To qualify as an IBC, the following restrictions are imposed:

1. IBCs must operate outside of Seychelles, no business can be conducted in the jurisdiction. However, these companies can invest in shares of local companies or buy Seychelles government bonds;

2. You cannot own real estate in Seychelles. The property can be leased for office use only;

3. May not be used for banking, insurance, or registered agent activities.

Thus, IBCs are the most popular unless the operations are in the Seychelles International Trade Zone. Meanwhile, companies trading in the Seychelles, as well as banks, insurance companies and mutual funds, show a preference for various types of companies formed under the Companies Act 1972. In 2003, the government legislated new types additional companies: Companies with special license (CSL), Protected Cell Companies (PCC) and Limited Partnerships.

The CSL is a low tax company, subject to 1.5% tax on its worldwide income, with access to the growing number of Seychelles Double Taxation Agreements. It is the preferred vehicle for offshore operations requiring treaty benefits. CSL and Limited Partnership may establish an office in Seychelles for the purpose of doing business outside of Seychelles. The PCC is the vehicle for approved offshore insurance, mutual funds, and other collective investment plans. PPC companies are tax exempt if their insurance or mutual fund activities are licensed by a Seychelles authority. Just in case, an IBC can be transformed at any time into a CSL.

In general, during the last few years, Seychelles has made steady progress. It enjoys a very complete offshore tax haven legislation in the world. With two main types of offshore companies available in the jurisdiction, the classic IBC, which is tax-free, and the low-tax CSL, Seychelles retains a significant share of the global offshore business market and looks to the future with confidence.