The Tax Benefits of Banking and Investing in Belize

The Tax Benefits of Banking and Investing in Belize

Belize has long been popular as a destination. Known for its beautiful beaches, lush tropical landscape, and friendly people, it’s no small wonder people flock here each year for a little rest and relaxation.

What many people might not know about are the tax benefits and asset structures available in Belize that are available to those who choose to retire, invest, or bank here. These tax advantages extend to companies as well.

Every jurisdiction has its own taxation rules for foreign investors and bank account holders, but Belize offers some of the biggest savings. Here are a few of the most significant ways you can benefit.

Tax Exemptions for IBCs 
While private account holders will benefit from the taxation system in Belize, some of the biggest advantages are for businesses who operate out of Belize. If you have an International Business Company, also known as an IBC, then your company will benefit from a number of tax exemptions.

When a company incorporates in Belize as an IBC, virtually all transactions and profits that result from that IBC are exempt from taxes. This comes from the Belize International Business Companies Act, Article 130.

More specifically, an IBC operating in Belize won’t pay taxes on dividends distributed from the company, capital gains realized, and transactions completed. In short, this makes it very, very appealing to establish an IBC account in Belize.

Income Tax Relief for Foreigners
If you bank in Belize, there are many sources from which your assets can come. Most international bank account holders who opt to bank in Belize have some form of income. While the form of income can vary from person to person, it generally includes capital gains, a salary, or a pension. 

If you are a native resident and citizen of Belize, then your income will be subject to a domestic income tax rate. This is similar to any other nation where citizens are subject to income tax, such as Canada, Hong Kong, Great Britain, and the United States.

However, how Belize differs is when it comes to the taxation on foreigners who live or bank in Belize. In most cases, foreigners won’t have to pay tax on their earned income. As long as the income is not made in Belize you won’t pay any income taxes to the government of Belize. 

Taxes for Assets Held in a Trust
Another tremendous tax benefit that comes from banking in Belize is when you decide to place some of your assets in a trust in Belize. When your assets are in a trust, they are no longer legally under your direct control. However, you can establish a plan for the trust so that the assets are used as initially outlined. This can be a key part of estate planning, but it is also a smart way to preserve and protect many different kinds of assets.

Perhaps even more importantly, assets held in a trust in Belize aren’t subject to taxation. After all, they are no longer technically your assets, which means that you aren’t liable for their taxation. At the same time, the intended beneficiaries of the future also aren’t subject to taxation. That creates a fantastic financial instrument with significant tax advantages.


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