Saint Lucia has become in recent years a popular offshore financial services center due to its pro-business legal framework.
IBCs stand out for its fast registration process, confidentiality, flexible structure, and its low annual fees and reporting requirements.
IBCs can be incorporated by a sole shareholder, who can be either resident or non-resident, individual or corporation. One director is required, who can be either resident or non-resident, individual or corporation, and can be the same person as the shareholder.
Reporting requirements are non-existent. Annual return, financial statements, and tax return are not required to be filed.
IBCs are now subject to the local tax regime. However, Saint Lucia has also passed several amendments to its tax laws to switch to a territorial tax system. All companies, including IBCs, will be taxed at 30% corporate tax on income from Saint Lucia-source and will be exempted from taxation on income from foreign sources.
Foreign-source income is defined as follows:
- Profits derived from a permanent establishment outside of Saint Lucia
- Profits derived from immovable property situated outside of Saint Lucia
- Interest income not borne by a Saint Lucia permanent establishment or charged against property located in Saint Lucia
- Income derived from investment in securities issued by a person outside of Saint Lucia, e.g. mutual funds, stocks, bonds, etc.
- Management charges paid by a nonresident outside of Saint Lucia
- Royalty payments received from a foreign permanent establishment and paid to a resident permanent establishment.
- Any income deemed to be accrued from foreign sources due to a DTA.
Dividends and capital gains are also exempt from taxation in Saint Lucia.
IBCs conducting certain economic activities will have to meet certain substance requirements – including an adequate number of employees, adequate operating expenditure, adequate investment and capital commensurate according to the activity, as well as file annual tax returns, among others.
Due to its features, Saint Lucia’s IBCs are commonly used vehicles for a broad range of investment and business purposes, such as offshore investments, professional services, international trade, insurance and as a holding company.
