JNA: Formation of Companies in Guernsey

Updated April 2018

WHY USE GUERNSEY?

Guernsey is a premier international financial centre with an enviable reputation and excellent standards. The Island is also one of the leading jurisdictions providing international insurance services and has developed as a base from which internationally mobile individuals can organise their worldwide affairs.

Factors contributing to and enhancing the status of this jurisdiction include:

  • A general rate of tax payable by Guernsey companies of zero.
  • There are no wealth taxes, no inheritance taxes, no withholding taxes on dividends, no capital gains taxes and no VAT.
  • For Guernsey resident individual tax payers there is a maximum tax charge of £220,000 on their worldwide income.
  • Individuals relocating to the Island can effectively elect to pay tax on their Guernsey source income only, capped at £110,000, or on their worldwide income capped (as detailed above) at £220,000.
  • The Companies (Guernsey) Law 2008, the Trusts (Guernsey) Law 2007 and the Foundations (Guernsey) Law 2012, reflect Guernsey’s commitment to providing a modern statutory basis and increased flexibility for companies and individuals using the jurisdiction of Guernsey. The laws also reflect the importance placed on corporate governance.
  • A Guernsey Foundation is the only entity of this type that offers potential for disenfranchised beneficiaries.
  • Legislative and fiscal independence mean that the Island responds quickly to the needs of business. In addition the continuity achieved through the democratically elected parliament, without political parties, helps deliver political and economic stability.
  • A wide range of internationally respected business sectors: banking, fund investment and management, insurance and fiduciary. To meet the needs of these professional sectors, a highly skilled workforce has developed in Guernsey.
  • Guernsey is the only jurisdiction in the world to provide a statutory image rights regime. Once individuals have registered their image they can then assign their registered image rights to a Guernsey company which may enable a tax-efficient treatment for the wealth generated from licence arrangements.
  • 2REG, the Guernsey aviation registry offers a number of tax and commercial efficiencies for the registration of private and, off-lease, commercial aircraft.

FORMATION OF COMPANIES IN GUERNSEY

General information is detailed below outlining the formation and regulation of companies in Guernsey, as embodied in the Companies (Guernsey) Law 2008.

  1. Incorporation

Incorporation can normally be effected within twenty four hours.

  1. Minimum Capitalisation

There are no minimum or maximum capital requirements. Bearer shares are not permitted.

  1. Directors/Company Secretary

The minimum number of directors is one. There are no residency requirements for either directors or secretaries.

  1. Registered Office/Registered Agent

The registered office must be in Guernsey. A registered agent needs to be appointed, and must be licensed by the Guernsey Financial Services Commission.

  1. Annual General Meeting

Members can elect not to hold an Annual General Meeting by Waiver Resolution (requiring a 90% majority).

  1. Annual Validation

Each Guernsey company must complete an Annual Validation, disclosing information as at 31st December of each year. The Annual Validation must be delivered to the Registry by 31st January of the following year.

  1. Audit

Members can elect for the company to be exempt from the obligation to have an audit by Waiver Resolution (requiring a 90% majority).

  1. Accounts

There is no requirement to file accounts. However, proper books of account must be maintained and sufficient records must be kept in Guernsey to ascertain the financial position of the company at no greater than six monthly intervals.

  1. Taxation

The general rate of corporation tax is zero. The only exceptions are:

  • Banking activities which are taxed at 10%
  • Rental income from Guernsey properties which is taxed at 20%
  • Profits of Guernsey resident regulated utility companies which are taxed at 20%.

If you would like additional information regarding the formation of companies in Guernsey and the fees that Dixcart charge, please contact: john.nelson@dixcart.com

 

Dixcart Trust Corporation Limited has a Full Fiduciary Licence granted by the Guernsey Financial Services Commission

Categories: Jurisdiction, Guernsey, Year, 2014