Expanding your business operations into The Bahamas is not only a smart move, it’s easier than you think. Don’t let paperwork and red tape slow your global growth. Our comprehensive guide takes you through the essential steps for Company Formation in the Bahamas.
Table of Contents
Why Choose the Bahamas to Incorporate or Form a Company?
The Bahamas offers a host of advantages that can benefit your business:
- Strategic Location
- Economic Growth
- Skilled Workforce
- Business-Friendly Reforms
- Abundant Natural Resources
- Infrastructure and Connectivity
- Expanding Customer Base
Before we look at how to incorporate a company in The Bahamas, let’s explore why this Caribbean paradise is a prime location for your business efforts.
Situated in the Atlantic Ocean, The Bahamas provides convenient access to regional and international markets, making it an ideal hub for trade and commerce.
The Bahamas has a steadily growing economy, making it a hotspot for innovation and investment. This economic dynamism offers ample opportunities for business expansion.
The country is home to a substantial population of young and skilled workers, which translates into competitive labor costs, making it an attractive proposition for businesses.
The Bahamas has taken significant steps to improve its business climate through regulatory reforms that streamline bureaucratic processes and incentivize foreign investment. These incentives include tax breaks and free trade zones to encourage company incorporation.
Abundant Natural Resources
The Bahamas is rich in natural resources, particularly in sectors such as agriculture, mining, and renewable energy, which are pivotal for various industries.
Infrastructure and Connectivity
The country’s infrastructure and transportation networks continue to improve, further facilitating business operations and accessibility.
Expanding Consumer Base
With a diverse and growing consumer base, The Bahamas presents a promising market for domestic and export-oriented companies aiming to expand in the Caribbean region.
What are the minimum requirements to incorporate a Limited Company in the Bahamas?
The Minimum requirements to incorporate a Limited Company in the Bahamas are:
- The company name must be unique and not already registered.
- It should not be misleading or similar to existing businesses.
- A registered agent, who is a resident of The Bahamas, is required. The registered agent’s role is to receive legal documents and official correspondence on behalf of the company.
- Minimum of one director required
- Directors can be individuals or corporate entities
- Copies of the passports of business owners
- Minimum of one shareholder required
- Shareholders can be individuals or corporate entities
- Copies of the passports of the shareholders
- Registered office address in the Bahamas required
- Companies must keep certain statutory records, including minutes of meetings and a register of directors and shareholders
- Companies subject to corporate income tax
- No capital gains tax, inheritance tax, or value-added tax
- Opening a bank account in the Bahamas is often part of the process
- Companies required to file annual returns and financial statements
Incorporating in The Bahamas: A Step-by-Step Guide
Now you know the enticing prospects of doing business in The Bahamas, let’s focus on the critical steps involved in incorporating a company:
1. Preliminary Foundations:
- Company Name Availability: Ensure your chosen company name is available and not already registered. Keep in mind that your legal business name and trademark can be different.
- Draft Bylaws: Prepare your business’ bylaws. These bylaws should encompass all pertinent information about your company, including its structure, operations, and activities.
- Tax ID: If you plan to establish your company in Nassau, the capital city of The Bahamas, you can obtain a Tax Identification Number (TIN) through the Chamber of Commerce. However, if your business is in a different part of the archipelago, you may need to follow additional steps. Initially, you must apply for a provisional TIN, and only after receiving it can you apply for the final TIN from the Department of Inland Revenue (DIR). This is a crucial step in the incorporation process.
2. Company Legal Structure:
In The Bahamas, there are several legal structures to choose from when forming your company. The three primary options are:
- Limited Company
- Joint-Stock Company
- Simplified Stock Company (SAC)
A Simplified Stock Company (SAC) is often the preferred choice for foreign investors due to its simplicity and fewer formalities. It is highly recommended that both local and foreign investors use this legal structure, which was established in 2008.
3. Registration with Key Institutions:
To successfully incorporate a company in The Bahamas, you will need to liaise with three primary institutions:
- The Chamber of Commerce: This institution is responsible for overseeing the formation of new companies in The Bahamas. It ensures that your registration adheres to the current legal requirements and policies. Moreover, it will provide you with a certificate that attests to the existence and legal status of your company. Once your business is operational, various private and public entities frequently request this certificate.
- Department of Inland Revenue: The DIR registers your business within the tax system and provides you with a unique Tax Identification Number (TIN). This TIN serves as a general identifier and is essential for filing mandatory tax declarations.
- Local Bank: You also need to open a corporate bank account. The account is necessary for business operations and for receiving foreign investments. Keep in mind that specific banks may have additional requirements for account setup.
4. Incorporation Document:
You need to create an incorporation document that details the names and personal information of all partners involved in the business. This document should also specify the company’s name and the activities it will engage in within The Bahamas.
Additional elements in the incorporation document include:
- Capital structure
- Board of directors
- Partner responsibilities
- Causes of termination
5. Legal Representation:
Your company must appoint a legal representative who is responsible for the day-to-day business operations. This individual will be authorized to file tax declarations and sign all contracts and legal documents on behalf of the company.
Frequently Asked Questions (FAQs) for Company Formation in The Bahamas:
Yes, businesses in The Bahamas can be 100% foreign-owned by legal entities or individual investors.
The company formation process in The Bahamas typically takes around 4 weeks.
The following are the most common statutory appointments for a Bahaman legal entity:
An appointed Local Director who will be personally liable, both legally and financially for the good operation and standing of the company. This Director can be the same as the shareholder and can be either a local national or a foreigner.
Yes, a registered local Fiscal Address is required for all entities in The Bahamas for the receipt of legal correspondence and Governmental visits.
Biz Latin Hub Can Help You Incorporate
The Bahamas is an ideal destination if you are looking to expand your business operations or start a new business. However, before you get everything up and running, you must complete the company registration process.
Biz Latin Hub offers tailored business services like company formation, legal services, accounting/taxation services, and visa processing. Contact us now and see how we can assist you in incorporating or forming your new company in The Bahamas.
Check out this video on Company Formation in the Bahamas to know more: