International banking and financial houses have been attracted
to Barbados as a result of its tax incentives, the high quality
of professional services and the reputation of Barbados as
a reputable Offshore Banking Center.
In order to establish an offshore bank in Barbados, details
of the proposed bank must first be submitted to the Central
Bank of Barbados for approval. Approval must be sought from
the Ministry of Finance prior to the incorporation of a company.
A company must have a licence before engaging in the offshore
banking business. Applications for a licence are submitted
to the Central Bank who may issue the licence, subject to
the approval of the Minister of Finance. A licence to operate
is issued only to qualified foreign bank's and eligible companies.
Licences are under the overall control and oversight of the
Central Bank of Barbados. Offshore Banks are subject to audit,
an annual licence of US$12,500 and income tax on a sliding
scale of 2.5% - 1%.
The Offshore Banking Act provides that dividends, royalties,
interest, foreign securities funds, gains and assets generated
or managed by a licensee are automatically exempt from the
provisions of the Exchange Control Act.
Summary of benefits
- Tax at the rate of 1% (on profits over US$15 million),
up to 2.5% (profits up to US$5 Million)
- No direct tax or capital gains
- No withholding tax
- No exchange control
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