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Belize economic substance
self-assessement tool

Let's check whether your company is subject to Belize economic substance requirements!

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Disclaimer:

The information contained in this tool is for general information purpose only. This tool is made available based upon the legislation of Belize Economic Substance Act, 2019 and its guidance note. You should not substitute the information provided in this tool for competent legal advice. For further in-dept understanding of how Belize economic substance requirements work on your specific circumstance, please engage professional advice.

In no event will we take responsibility for the adequacy or completeness of any information in this tool. Any reliance on this tool which may then cause any loss or damage of any kind shall be solely at your own risk.

Qualification Test

Compliance Requirement

Reporting Obligation

Legal Entity
Relevant Activities
Tax Residency

What is the legal type of your business entity in Belize?

Timeline Reporting

All IBCs must report to the competent authority within nine months of the end of a fiscal year.

The first fiscal year reporting period for entities incorporated before January 1, 2020 shall commence on April 30, 2020.

Do note that your Belize company could elect an earlier commencement date of reporting period (but not before October 11, 2019) as long as you notify the IFSC.

The first fiscal year of an entity incorporated on or after January 1, 2020 shall commence on the date of incorporation and shall terminate on the expiry of one year from that date.

Your Belize company could elect an earlier termination of the first fiscal year should you give notice to the IFSC for that intention.

Do note that your entity must provide IFSC with notice to request earlier date within 3 months of date of incorporation.

Click the link below to download your reporting form.

Form D >>

Kindly contact us to learn more about our solutions for helping your Belize company comply with the substance rules.

Timeline Reporting

All IBCs must report to the competent authority within nine months of the end of a fiscal year.

The first fiscal year reporting period for entities incorporated before January 1, 2020 shall commence on April 30, 2020.

Do note that your Belize company could elect an earlier commencement date of reporting period (but not before October 11, 2019) as long as you notify the IFSC.

The first fiscal year of an entity incorporated on or after January 1, 2020 shall commence on the date of incorporation and shall terminate on the expiry of one year from that date.

Your Belize company could elect an earlier termination of the first fiscal year should you give notice to the IFSC for that intention.

Do note that your entity must provide IFSC with notice to request earlier date within 3 months of date of incorporation.

Your Belize company will have to provide the Authority with a letter or certificate:

(a) From or issued by the tax authority of its jurisdiction of residence, stating that the commercial entity is considered to be resident for tax purposes in that jurisdiction;

(b) Showing a clear and specific period of validity; and

(c) Showing an assessment of tax on the entity, a confirmation of self-assessment of tax, a tax demand, evidence of payment of tax, or any other equivalent document issued by the tax authority for the jurisdiction in question.

The Authority will exchange all information received from an entity claiming foreign tax residence with the relevant jurisdiction(s) in accordance with the OECD convention on Mutual Administrative Assistance in Tax Matters.

Click the link below to download your reporting form.

Form D >>

Kindly contact us to learn more about our solutions for helping your Belize company comply with the substance rules.

Timeline Reporting

All IBCs must report to the competent authority within nine months of the end of a fiscal year.

The first fiscal year reporting period for entities incorporated before January 1, 2020 shall commence on April 30, 2020.

Do note that your Belize company could elect an earlier commencement date of reporting period (but not before October 11, 2019) as long as you notify the IFSC.

The first fiscal year of an entity incorporated on or after January 1, 2020 shall commence on the date of incorporation and shall terminate on the expiry of one year from that date.

Your Belize company could elect an earlier termination of the first fiscal year should you give notice to the IFSC for that intention.

Do note that your entity must provide IFSC with notice to request earlier date within 3 months of date of incorporation.

Click the link below to download your reporting form.

Form C >>

Kindly contact us to learn more about our solutions for helping your Belize company comply with the substance rules.

Timeline Reporting

All IBCs must report to the competent authority within nine months of the end of a fiscal year.

The first fiscal year reporting period for entities incorporated before January 1, 2020 shall commence on April 30, 2020.

Do note that your Belize company could elect an earlier commencement date of reporting period (but not before October 11, 2019) as long as you notify the IFSC.

The first fiscal year of an entity incorporated on or after January 1, 2020 shall commence on the date of incorporation and shall terminate on the expiry of one year from that date.

Your Belize company could elect an earlier termination of the first fiscal year should you give notice to the IFSC for that intention.

Do note that your entity must provide IFSC with notice to request earlier date within 3 months of date of incorporation.

Click the link below to download your reporting form.

Form B >>

Kindly contact us to learn more about our solutions for helping your Belize company comply with the substance rules.

Your Belize company will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Each relevant activity will have its own set of core income generating activities regulated by laws.

For Banking business:

  • the raising of funds, managing risk including credit, currency and interest risk;
  • taking hedging positions;
  • providing loans. credits or other financial services to customers: or
  • managing regulatory capital, and preparing regulatory reports and returns.

For Insurance business:

  • the predicting and calculating of risk; or
  • insuring or re-insuring against risk, and providing client services.

As with Fund management service:

  • the taking of decisions on the holding and selling of investments;
  • calculating risks and reserves;
  • taking decisions on currency or interest fluctuations and hedging positions; and
  • preparing relevant regulatory or other reports for government authorities and investors

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”.

What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

Your Belize Distribution and service business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to Distribution and Service Centers are as follows:

  • the transporting and storing of goods;
  • managing stocks and taking orders.

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

In respect of an IBC incorporated on or before October 16, 2017, such IBC shall comply with the substantial economic presence requirements of the Economic Substance Act, 2019 but shall have the period up until June 30, 2021 to meet such compliance.

Your Belize Shipping business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to shipping businesses are as follows:

  • the managing of the crew, including hiring, paying, and overseeing crew members
  • hauling and maintaining ships;
  • overseeing and tracking deliveries; and
  • determining what goods to order and when to deliver them and organizing and overseeing voyage.

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

In respect of an IBC incorporated on or before October 16, 2017, such IBC shall comply with the substantial economic presence requirements of the Economic Substance Act, 2019 but shall have the period up until June 30, 2021 to meet such compliance.

Your Belize Headquaters business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to headquarters businesses are as follows:

  • the taking of relevant management decisions;
  • incurring expenditures on behalf of group entities; and
  • coordinating group activities.

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

In respect of an IBC incorporated on or before October 16, 2017, such IBC shall comply with the substantial economic presence requirements of the Economic Substance Act, 2019 but shall have the period up until June 30, 2021 to meet such compliance.

Your Belize Finance and leasing business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to finance and leasing businesses are as follows:

  • the agreeing of funds terms
  • identifying and acquiring assets to be leased, in the case of leasing
  • setting the terms and duration of any financing or leasing
  • monitoring and revising any agreements; and
  • managing any risk.

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

In respect of an IBC incorporated on or before October 16, 2017, such IBC shall comply with the substantial economic presence requirements of the Economic Substance Act, 2019 but shall have the period up until June 30, 2021 to meet such compliance.

Your Belize Fund Management business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to fund management businesses are as follows:

  • the taking of decisions on the holding and selling of investments;
  • calculating risks and reserves;
  • taking decisions on currency or interest fluctuations and hedging positions; and
  • preparing relevant regulatory or other reports for government authorities and investors

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

Your Belize Insurance business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to insurance businesses are as follows:

(a) the predicting and calculating of risk; or

(b) insuring or re-insuring against risk, and providing client services.

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

Your Belize Banking business will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

Core income-generating activities (CIGA) in relation to banking businesses are as follows:

  • the raising of funds, managing risk including credit, currency and interest risk;
  • taking hedging positions;
  • providing loans. credits or other financial services to customers: or
  • managing regulatory capital, and preparing regulatory reports and returns.

2. Adequate expenditure, employees and appropriate premises in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

The ordinary meaning of “adequate” is: “as much or as good as necessary and sufficient for a specific need or requirement”. What is adequate for each company will be dependent on the particular facts of the company and its business activity.

3. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

Your Belize holding company will be deemed as compliant with Economic substance requirement if it:

(a) comply with all applicable laws and regulations of Belize; and

(b) have

  • adequate human resources and premises in Belize for holding equity participation in other entities; and
  • where it manages those equity participations in other entities, adequate human resources and premises in Belize for carrying out the management.

Your Belize company will be considered compliant with the economic substance requirements if it can meet following tests:

1. Conducting its core income generating activities in Belize:

In assessing whether CIGA are conducted in Belize, following criteria will be considered:

  • amount of annual operating expenditure
  • number of qualified full-time employees
  • physical offices

2. Management and Control in Belize:

Your Belize company must also demonstrate substantial economic presence in Belize in terms of:

  • Adequate number of meeting of Board of Directors in Belize
  • Quorum of Board of Directors present at the meetings in Belize
  • Strategic decisions of the meetings must be recorded in the minutes of meetings
  • All records and minutes must be kept in Belize
  • The board of directors must have necessary knowledge and expertise to fulfil its duties

In respect of an IBC incorporated on or before October 16, 2017, such IBC shall comply with the substantial economic presence requirements of the Economic Substance Act, 2019 but shall have the period up until June 30, 2021 to meet such compliance.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Is your Belize company tax resident of the jurisdiction mentioned in Annex 1 to the EU list of non-cooperative jurisdictions for tax purposes?

You can check Annex 1 list HERE

Is your Belize company controlled and managed outside of Belize and having proof of Tax Resident in a jurisdiction other than Belize?

FAQs

What documents do I have to provide to be considered tax resident in a foreign jurisdiction?

The entity will need to be able to provide the Authority with a letter or certificate –

(a) From or issued by the tax authority of its jurisdiction of residence, stating that the commercial entity is considered to be resident for tax purposes in that jurisdiction;

(b) Showing a clear and specific period of validity; and

(c) Showing an assessment of tax on the entity, a confirmation of self-assessment of tax, a tax demand, evidence of payment of tax, or any other equivalent document issued by the tax authority for the jurisdiction in question.

The Authority will exchange all information received from an entity claiming foreign tax residence with the relevant jurisdiction(s) in accordance with article 4 and 7 of the OECD convention on Mutual Administrative Assistance in Tax Matters.

Your Belize entity must be regulated under the Mutual Funds Act to conduct Fund management business.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Does any constituent entity under the umbrella of your Holding Company engage in any of the relevant activities as below?

  • Banking
  • Insurance
  • Fund Management
  • Finance and Leasing
  • Headquarters
  • Shipping
  • Distribution and Service Center

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Is your Holding Company conducting any of the relevant activities (listed below) as a secondary business activity?

  • Banking
  • Insurance
  • Fund Management
  • Finance and Leasing
  • Headquarters
  • Shipping
  • Distribution and Service Center

Does any constituent entity under the umbrella of your Holding Company engage in any of the relevant activities as below?

  • Banking
  • Insurance
  • Fund Management
  • Finance and Leasing
  • Headquarters
  • Shipping
  • Distribution and Service Center

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Your Belize company is considered “Non-included Entity” and DOES NOT fall within the scope of Belize economic substance.

Your Belize entity must be regulated under the International Banking Act to conduct Banking business.

Your Belize entity must be regulated under the International Financial Services Commission Act, and the International Insurance Act to conduct Insurance business.

Does your company take part in any of the following activities?

(a) collects and pools funds for the purpose of collective investment; and

(b) issues shares that entitle the holder to receive on demand or within a specified period after demand an amount computed by reference to the value of a proportionate interest in the whole or in a part of the net assets of the company, the partnership or the unit trust, as the case may be.

Is your Belize company providing credit facilities of any kind for consideration such as:

(a) consideration by way of interest;

(b) the provision of credit by way of instalments for which a separate charge is made and disclosed to the customer in connection with –

(i) the supply of goods by hire purchase

(ii) leasing, other than any lease granting an exclusive right to occupy land; or

(c) conditional sale or credit sale;

Does your Belize company provide any of the following services to an entity in the same group?

(a) the provision of senior management

(b) the assumption or control of material risk for activities carried out by, or assets owned by, any of those entities in the same group; or

(c) the provision of substantive advice in connection with the assumption or control of risk referred to in paragraph (b), but does not include anything falling within the definition of financing and leasing business, insurance business, or banking business;

Does your business activity involve any of these following activities relating to the operation of a ship anywhere in the world other than in the territorial waters of Belize?

(a) the business of transporting. by sea, persons, animals, goods or mail;

(b) the renting or chartering of ships for the purpose described in paragraph (a);

(c) the sale of travel tickets or equivalent, and ancillary services connected with the operation of a ship;

(d) the use, maintenance or rental of containers, including trailers and other vehicles or equipment for the transport of containers, used for the transport of anything by sea;

(e) the management of the crew of a ship.

(**) but does not include a fishing vessel or the owning, operating or chartering of a pleasure yacht as defined in this section.

Is your holding company

  • a commercial entity only holding equity participations; and
  • earns only dividends and capital gains or related incidental income?

Does your company conduct either or both of the following business?

(a) Purchasing form foreign related parties

(i) Component parts or materials for goods, or

(ii) Goods ready for sale; and

(iii) Reselling such component parts, materials or goods;

(b) Providing services to foreign related parties in connection with the business, but does not include any other activity except holding company business.

What type of business activities does your Belize entity involve in?