Posted in Corporate & Financial Services
The U.S.Virgin Islands provides business owners with some significant tax incentives as
a means of boosting its economy and encouraging businesses to open up shop in
the Territory. While qualified businesses are able to reduce up to 90
percent of their
personal and corporate federal income taxes, and could even receive a full
exemption on local taxes such business property, excise and gross receipt
taxes, there are a few basic items you should know about registration and
incorporation in the U.S. Virgin Islands that all corporations must go through
to be legally incorporated in the Territory.
Articles of
incorporation
You must file articles of incorporation if you are to
officially form a corporation in the U.S. Virgin Islands. Unlike most states,
however, there is not a standard form for incorporation—so it is up to the
corporations to draft this document themselves.
The three types of corporations that can be formed in
the territory are:
Domestic corporations: These corporations are located in the
Territory and do business here. They are eligible for tax incentives if they
meet the qualifications put forth by the Economic Development Authority.
Exempt companies: These companies are not allowed to engage in any
active trade in the U.S. Virgin Islands or United States. Residents of the
United States or the Territory are not allowed to own 10 percent or more of the
company. Such companies are exempt from income, gross receipts, license
requirements and withholding taxes in the territory.
Registering
as a foreign corporation
Any company that wants to conduct
business in the U.S. Virgin Islands, but does
not wish to incorporate, is required to file a document known as a Certificate
of Appointment of Process Agent and Sworn Statement. This document must be
submitted to the Territory’s Office of the Lieutenant Governor.
Additionally, the corporation is required to provide a
statement of its liabilities, assets and capital stock to the lieutenant
governor. The certificate filed must include a copy of the company’s
Certificate of Incorporation and any amendments that have followed, along with
a Certificate of Good Standing from its domestic jurisdiction. Signed consent
from a registered agent is also required to show the named agent has agreed to
serve in that role.
Individuals wishing to start a corporation in the U.S.
Virgin Islands have a variety of options at their disposal. For more
information on how to get a corporation registered and the types of benefits
that are associated with becoming a corporation in the territory, consult an
experienced business law attorney.
Tom Bolt
is Managing Attorney at BoltNagiPC, a widely respected and
well-established corporate law firm serving clients throughout the U.S. Virgin
Islands.
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