Opening A Store In Belize: A Step-By-Step Guide

Opening a store in Belize can be both easy and frustrating. Here are the steps you need to take to open a store in Belize:

- Decide on a product or service idea and put everything on paper.

- Protect your idea by registering your intellectual property.

- Formalise your business by registering it via the Companies & Corporate Affairs Registry.

- Get funding for your business. Local banks are happy to lend to expats as long as your credit is good.

- Acquire a trade license if your business involves exchanging goods and services for money.

- Apply for a work permit.

- Register with the Income Tax and Government Sales Tax Departments. You will be given a unique Tax Identification Number (TIN).

- Learn to do business Belize Style.

Registering key business details

Company Type

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 international business and tax planning, 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 to the Land Office so that this address is officially recognised. While your operational offices can be located anywhere in the world, your official business address must be in Belize.

Business Name

When developing your company name, there are some key restrictions to abide by:

• The name must be unique
• The name cannot contain any insulting or vulgar words
• The name cannot suggest that the company is patronised by the Belize government
• The name cannot contain specific types of words such as 'Royal' or 'Imperial'
• If your company name contains words with financial connotations such as 'bank' or 'loans', a corresponding license needs to be obtained.

Submission of Details

Once all the key details of your company are finalised, they can be submitted to the Companies and Corporate Affairs Registry, along with the necessary supporting documents. You can obtain the specific application form from their website or fill it out at their physical offices.

Additional Requirements for Non-Nationals

Non-nationals cannot operate a business that hasn't been registered under the Companies Act and/or the Business Name Act. Additionally, they must obtain a work permit. The process of obtaining a work permit can be tedious and lengthy, so it is recommended to hire a legal advisor to facilitate the process.

Other Considerations

• It is important to protect your intellectual property by registering your inventions, logos, symbols, designs, business name, and other intangible creations. This can be done through the Belize Intellectual Property Office.
• Local banks are generally willing to lend money to ex-pats for start-ups, provided they have good credit. However, the interest rates may be higher than those of U.S. financial institutions.
• If you plan to exchange goods and services for money, you must acquire a trade license from the Town Board or City Council. This requires an annual payment, the amount of which is determined by the annual rental value of your business space.
• To hire employees, you must register with the Income Tax and Government Sales Tax Departments and obtain a unique Tax Identification Number (TIN).

Acquiring a trade license

Once your business obtains its trade license, you must register with the Government Sales Tax department and the Income Tax department. This registration will provide your business with a unique Tax Identification Number (TIN) for various administrative purposes. The TIN must be attached to all revenues, whether they are cash, in-kind goods, or services.

The fees for trade licenses in Belize vary across sectors and are charged based on the annual rental value of the property. For example, supermarkets, grocery stores, furniture stores, and repair shops are subject to a 3.5% fee, while hardware stores, gas stations, and dentistry offices incur a 5% fee. Businesses in gaming or monopolies are charged the highest rate of 25%.

It is also important to note that trade licenses are only granted to businesses operating in designated "commercial areas" of the city. The final approval for a trade license is based on the recommendation of the Trade Licensing Board responsible for each town or city.

Registering with the Income Tax and Government Sales Tax Departments

To open a store in Belize, you will need to register with the Income Tax and Government Sales Tax Departments. This is a crucial step in the process of registering your business. Once you have completed this step, you will be assigned a unique Tax Identification Number (TIN). This number is essential for various administrative processes and taxation issues, such as General Sales Tax (GST), Excise Taxes, and Custom processes.

To register for Business Tax, you must fall into one of the following categories:

• Persons carrying on a trade or business that earns $75,000 or more per annum, with this being their only source of livelihood.
• Self-employed persons practising a profession or running a business and earning $20,000 or more per annum, with this being their only source of livelihood.
• Persons engaged in the business of investment or earnings from real or personal property.
• Persons engaged in the provision of personal services, including Tour Operators, Travel Agents, and other Commission Agents.

Additionally, if your annual turnover is $75,000 or more, you must register for GST. Turnover refers to the total value of taxable sales, receipts, or takings made from your taxable activities, excluding GST charged. Even if your annual gross sales/receipts are less than $75,000, you must still register if you are a promoter of public entertainment or a licensee/proprietor of places of public entertainment.

To register for Business Tax and/or GST, you need to fill out an Application for Registration Form, which can be obtained from any local BTS Office. Along with this form, you must submit copies of relevant documents to the Belize Tax Service. These documents vary depending on whether you are registering as a company, partnership, non-profit, or sole-proprietorship/individual. The specific requirements for each category can be found on the Belize Tax Service website.

It is important to note that you can also apply for voluntary GST registration if your taxable turnover is below the threshold. However, before applying, you must determine whether you are carrying on or intend to carry on a business and make taxable supplies. Additionally, you must ensure that 80% or more of the supplies will be made to taxable persons. Once registered, you must account for output tax (tax on sales) on all taxable supplies and can claim input tax credit (tax on purchases) only on purchases directly attributable to taxable supplies.

Applying for a work permit

To open a store in Belize, you will need to obtain a work permit unless you are a permanent resident. Here is a step-by-step guide on how to apply for a work permit:

Step 1: Determine Eligibility

Before starting the application process, it is important to determine if you are eligible for a work permit. As a foreign national seeking to work in Belize, you will generally need a work permit. However, there may be certain exemptions or simplified processes for specific categories of individuals. For example, retirees who meet the requirements of the Retired Persons Program can reside in Belize without a work permit. It is recommended to consult the relevant Belizean authorities or legal experts to ensure you meet the eligibility criteria.

Step 2: Understand the Requirements

The requirements for obtaining a work permit in Belize may vary depending on the type of work permit and your individual circumstances. However, some common requirements include:

• A valid passport with at least six months' validity
• A job offer or employment contract from a Belizean employer
• Educational and professional qualifications and certificates
• Passport-sized photographs
• Police clearance certificate from your home country
• Medical examination reports (if required)

Step 3: Gather Necessary Documents

In addition to the above requirements, you will need to gather several documents for your work permit application. These may include:

• The application form, which can be obtained from office supply stores in Belize
• Photocopies of all pages of your passport
• Passport-size ID pictures
• Receipt of payment of the administrative fee (BZD25)
• Postage stamps (BZD20)
• A copy of your Belize Police Record
• If applying for employment:
• Newspaper clippings showing that the position was offered to Belizeans
• A bank statement from your employer
• Relevant certificates
• A letter of recommendation from your employer
• If applying through starting a business:
• Bank statement and/or letter indicating how you plan to finance the business
• A letter of intent to employ Belizeans
• A recommendation letter from the village council
• Company Registration Certificate
• Certificates and/or diplomas
• Recommendation letter from a relevant ministry or organization
• Other relevant documents, such as birth certificate, marriage license, etc.

Step 4: Submit the Application

The work permit application must be submitted at any Labour Department Office in Belize. If you are employed, your employer will typically submit the application on your behalf and act as your sponsor. If you are self-employed, you must make the submission yourself.

Step 5: Wait for Application Status

After submitting your application, you will receive a notification from the Labour Department within 30 days informing you of the status of your application. If your application is approved, you will need to visit the Labour Department Office to receive a copy of the approval letter. If your application is denied, you must still visit the Labour Department Office to receive a copy of the denial letter and then present yourself to the Immigration Office to update your legal status.

Step 6: Visit the Immigration Office

Upon approval of your application, you must visit the Immigration Office and bring the approval letter. At this point, you will be informed of the temporary employment permit fees, which must be paid at the Immigration Office. You will also be instructed to obtain an Income Tax Letter from the nearest Belize Tax Service.

Step 7: Issuance of Permit

The final step in the process is to present your valid passport, proof of payment, and Income Tax letter to the Immigration Office, as stated on the approval letter. The permit will be issued immediately upon confirmation of payment. After receiving your permit, you must proceed to the Social Security Office to apply for your Social Security card.

Please note that work permits in Belize are typically valid for up to one year and must be renewed annually until you obtain permanent residency. There are various fees involved in the application process, including work permit fees, visa fees, medical examination fees, and police clearance certificate fees. These fees may vary depending on the type of permit, duration, and your nationality.

Getting start-up money

Local banks are usually happy to lend money to expats for start-ups, provided you have good credit. However, interest rates can be higher than at US financial institutions. If you've been in Belize for a while, it may be worth considering an international bank for a better deal. Financial products you may be eligible for include loans, lines of credit, and credit cards.

If you're thinking of starting a business in Belize, it's important to have some money saved up and to find a way to finance your business. There are a few different ways to do this, but the most important thing is to figure out what works best for your business.

It's worth noting that Belize 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 have expressed dissatisfaction with the perceived lack of transparency and effectiveness of these investment promotion tools.

In addition, as of June 28, 2024, the Belize Government amended the Fiscal Incentives Act to provide for duty and tax exemptions for project construction costs, establishment, and duty-free importation of household effects and equipment for skilled foreign workers and managers on investments over US$250 million. This amendment aims to grant development concessions to flagship investments in a more transparent manner.

Frequently asked questions