Get A Belize Business License: The Complete Guide

Belize is an upper-middle-income country in Central America with a small domestic market. It has close sociopolitical and economic ties to the Caribbean and is the only English-speaking country in Central America. The country has an export-oriented economy and benefits from its proximity to the large markets of the United States and Mexico.

Belize has a unique cultural heritage and is considered a tax haven. It offers multiple incentive programs aimed at promoting investment in the country, including the Fiscal Incentives Act, the International Business and Public Companies Act, the Export Processing Zone Act, and the Commercial Free Zone Act. However, foreign investors often express dissatisfaction with the perceived lack of transparency and effectiveness of these investment promotion tools.

1. Registration of Business Name: According to Belize's Business Names Act, every firm or individual with a place of business in Belize must register their business name at the Belize Companies Registry in the City of Belmopan. The application fee is BZ$25.00 (US$12.50), and the minimum average processing time is 3 hours.

2. Incorporation of a Company: To conduct business in Belize, an operation must be incorporated. The Memorandum of Association and the Articles of Association must be prepared and submitted to the Belize Companies Registry for review. After that, a Certificate of Incorporation is issued. The application fee depends on the quantity of share capital, and the minimum average processing time is 3 hours.

3. Land Acquisition and Development: If you plan to construct, alter, or demolish a building, you must obtain permission from the nearest administrating municipality, with final approval granted by the local Building Authority. All plans and designs must be submitted to the local Building Authority before construction begins. The average processing time is 2 weeks.

4. Trade License: Obtain a trade license from the local city or town council. The final approval is based on the recommendation of the Trade Licensing Board responsible for each town or city. The fees are determined based on a percentage of the annual rental value of the premises and are due within 30 days of receiving the bill.

5. Registration for Taxes: Register for relevant taxes, including General Sales Tax (GST), Business Tax, Income and Business Tax, and Social Security Tax.

Registering key business details

Type of Company

The two most common types of offshore companies recognised in Belize are International Business Companies (IBCs) and Trusts. If your company's main purpose is tax planning and international business, it is more suitable to incorporate as an IBC.

Business Area

All legal business activities are permitted in Belize, except for banking, insurance and reinsurance, which require a license.

Legal Address

To register your company's legal address, you must file an application with the Land Office so that the address is officially recognised. While your operational offices can be located anywhere in the world, your official business legal address must be in Belize.

Business Name

You must also invent and register a unique business name that does not contain any insulting or vulgar words, suggest patronage by the government of Belize, or contain specific types of words such as "Royal" or "Imperial". If your company name contains words with financial connotations, a corresponding license is required.

Submission of Details

Once you have finalised all the key details of your company, you can submit them to the Companies and Corporate Affairs Registry, located on the Ground Floor of the Garden City Hotel Building in the City of Belmopan, along with the necessary supporting documents. The application form can be obtained from their website or filled out at their offices. The registration fee is $25, and necessary documents include a valid Social Security card for all owners/partners.

Acquiring a trade license

Once the application form is filled, permission to operate is granted at one of the four quarterly meetings held throughout the year. After obtaining the trade license, an annual payment for the license is required. The amount mandated for each license payment is determined through a visit to the business operation's premises, where evaluators determine the annual rental value of the business space. The annual trade license fee is usually calculated at 25% of this annual rental value.

The general criteria for application are as follows:

• Submit a copy of Business Names Registration
• Submit an application form
• Interview with the applicant
• The business must be developing in a designated "commercial area" of the city
• Fees are calculated based on the annual rental value of the property and are divided by sectors

The final approval of a trade license is based on the recommendation of the Trade Licensing Board responsible for each town or city.

Businesses that require a trade license include:

• Building contractors
• Medical practitioners
• Any business providing a service

Registering for taxes

After registering your business name and obtaining a trade license, you must register with the Income Tax Department and Government Sales Tax Department for tax purposes. Upon completion of the registration process at the Income Tax Department, a unique Tax Identification Number (TIN) will be issued. The TIN number is the same number that is to be used for General Sales Tax (GST), Customs and Excise processes.

The General Sales Tax (GST) is a consumer tax applied at a rate of 12.5% on goods and services in Belize. Only registered persons can charge GST. You must register at the Department of GST if conducting a taxable activity and your annual turnover exceeds BZ $75,000 (US$37,500).

The Business Tax is a tax on receipts, whether in cash or in kind, and whether received or credited without any deduction for expenses. It is payable by any person practising their profession or firm carrying on business in Belize. The tax is imposed on persons or firms carrying on a trade or business that earns $75,000 or more per year, where such receipts are the only source of livelihood.

Persons who are self-employed and practising their profession or running their own business while earning $20,000 or more per year, where such receipts are the only source of livelihood, must also file a business tax return. Rates vary according to business classification, and business tax is paid monthly to the Income Tax Department.

Income and Business Tax

Persons carrying on a trade or business earning over BZ$ 75,000 (US$37,500) annually are to file a monthly business tax return. Self-employed persons earning BZ$ 20,000 or more annually are also to file a business tax return. Rates vary according to business classification.

Social Security Tax

Social Security covers the health benefits of employed persons in cases of sickness, maternity, or injury. Payments are to be withheld and paid monthly to the Belize Social Security Board (SSB). Each employer must ensure that persons are in possession of a valid social security card before hiring. All employees must register with the SSB.

Opening a corporate bank account

Choosing the Right Class of Corporate Bank Account in Belize

Corporate bank accounts in Belize are divided into two categories: Class A and Class B.

• Class A accounts are unrestricted licenses that require the account holder to establish, maintain and operate a business in Belize. This type of account is suitable for those planning to domicile in the country.
• Class B accounts are restricted-license accounts with similar requirements to Class A licenses but are limited to specific offshore banking activities. Class B accounts are tailored for companies that wish to take advantage of Belize's favourable tax laws and culture of privacy and confidentiality in the banking sector.

Documents Required to Open a Corporate Bank Account in Belize

When opening a corporate bank account in Belize, foreign investors typically need to present the following documents:

• A notarized copy of your passport
• A filled-out and signed application form
• Proof of address or residency (e.g. a copy of a utility bill)
• A notarized certificate of incorporation
• Certificate of shareholders
• A notarized memorandum of association
• A letter of undertaking

It is important to note that some banks may require additional documentation, such as social security numbers, company licenses, or driver's licenses.

Advantages of Opening a Corporate Bank Account in Belize

There are several advantages to opening a corporate bank account in Belize, including:

• A tax-free or low-tax structure, with no taxes on financial transactions or capital gains.
• A streamlined business registration process, with full incorporation completed in as little as two weeks.
• Foreign investors can purchase real estate and own property tax-free, and there are no restrictions on foreign ownership of real estate or land.
• Stringent laws protecting personal and business privacy, meaning board members and business partners are not required to disclose their identity if they are unwilling to do so.
• No need to domicile in the country to store offshore assets, making it an attractive destination for international businesses wishing to keep financial assets abroad.

Challenges and Considerations

While opening a corporate bank account in Belize has its advantages, there are also some challenges and considerations to keep in mind. Belize is considered an offshore jurisdiction, and some banks may be distrustful of entities from such locations due to concerns about money laundering and tax evasion. Additionally, the country's banking system is relatively fragile, and the recent impact of COVID-19 on the economy has further increased financial risk.

It is recommended that businesses open multiple multi-currency corporate bank accounts across multiple countries and avoid small banks to minimize the risk of financial loss.

Applying for a Central Bank Permit for Foreign Ownership of a Belize Company

To apply for a Central Bank Permit for Foreign Ownership of a Belize Company, you will need to follow the steps outlined below:

Step 1: Registering Key Business Details

Firstly, decide on the type of company you wish to set up. The two most common types of offshore companies in Belize are International Business Companies (IBCs) and Trusts. If your company's primary purpose is tax planning and international business, incorporating as an IBC would be the better option.

Next, choose your business area and register your legal address by filing an application with the Land Office. Your operational offices can be located anywhere in the world, but your official business address must be in Belize.

Finally, invent and register a unique business name that does not contain any insulting or vulgar words, suggest patronage by the Belize government, or include specific types of words such as "Royal" or "Imperial". If your company name contains words with financial connotations, you will need to obtain a corresponding license.

Step 2: Acquiring a Trade License

Submit an application for a trade license to the Town Board or City Council if your business intends to exchange goods and services for financial compensation within an urban area. Once your application is approved, you will be required to make an annual payment for the license, the amount of which will be determined through an evaluation of your business premises.

Step 3: Income Tax Registration

After obtaining your trade license, register your business with the Income Tax Department and the Government Sales Tax Department. Upon completion of this step, you will be issued a unique Tax Identification Number (TIN) for various administrative and taxation purposes.

Step 4: General Sales Tax (GST) Registration

All businesses and individuals engaged in activities that involve the taxation of consumer spending on goods and services during importation or business transactions must register with the Department of Government Sales Tax if their annual turnover rate is greater than BZ$75,000. Only registered entities can charge GST on their supplies as output tax and claim credit on purchases as input tax.

Step 5: Social Security Registration

In accordance with the Social Security Act, businesses or individuals who employ at least one person must register for social security with the Belize Social Security Board within one week of employing their first employee. Contributions to social security are made weekly but submitted to the department with a monthly statement. A portion of the contribution is paid by the employer, while the other portion is deducted from the employee's salary.

Step 6: Registration/Protection of Intellectual Property

Visit the Belize Intellectual Property Office to register and protect your business's intellectual property, including trademarks, patents, industrial designs, and copyrights.

Additional Considerations:

• While 100% foreign ownership is allowed and encouraged in Belize through the International Business Company Act, opening a bank account for your Belize business may be difficult due to the country's negative associations with money laundering and tax evasion.
• If your Belize entity wishes to operate in the insurance or finance industry, you will need to obtain a license, which may not be easy.
• Foreigners are allowed to have 100% ownership of both land and companies in Belize.

Frequently asked questions