Seychelles is a member of ESAAMLG – Eastern and Southern Africa Anti-Money Laundering Group.

There are over 30,000 IBCs incorporated in the Seychelles and the offshore industry generates more than US$25 million in revenue annually. For a country with a GDP of about $2 billion, this is a significant source of income.

The Seychelles authorities have said that the island nation is low at a low risk of money recycling since it is very remote and its banking sector is not particularly large.

ESAAMLG points out in its report that Business Service Providers (CSPs), despite the legal obligation to do so, often do not know the beneficial owner of IBCs, especially for IBCs sold through overseas resellers/intermediaries. The report also states that there is very little definition of what constitutes a beneficial owner.

In general, significant gaps in due diligence have been identified. This makes the destination particularly attractive for many clients if they want to legally hide their identity behind a Seychelles IBC.

Setting up a company in the Seychelles: fees and costs

Seychelles is a popular offshore financial center and a growing international market for company formation.

Companies incorporated under the International Business Companies Act, 1994, benefit from one of the fastest company formations in the world and the lowest annual government taxes.

International Business Companies are treated as resident for tax purposes but are subject to a territorial tax system, whereby income accrued from foreign sources is not subject to tax.

To incorporate a Seychelles IBC, only one shareholder and director are required, who can be an individual or a company and can be non-resident.

Members benefit from confidentiality as no details are available in the public register.

IBCs are not required to submit an annual return or balance sheet, provided they do not obtain income from Seychelles.

Seychelles has implemented the OECD Automatic Exchange of Information for Tax Purposes (AEoI).

Seychelless Offshore Company, business types and controls

Seychelles offshore companies are commonly used for wealth planning, wealth management as well as a holding company and for conducting international trade.

Corporate Income Tax: The Business Tax (Amendment) Act, 2018 implements a territorial tax regime in the Seychelles as of 1 January 2019. Income from a local source is subject to tax, while income from a foreign source is exempt from taxation.

If an IBC does business with Seychelles residents, it must notify the Registry, submit audited annual accounts and tax returns, and pay local taxes.

Dividends, interest, royalties or other payments made by Seychelles IBCs would be exempt from taxation provided they arise from non-Seychelles income. There are no capital gains taxes in the Seychelles.

IBCs are exempt from stamp duty on the formation of a company, transfers of ownership to or from a company, transactions relating to a company's shares, bonds or other securities; the creation, variation or extinction of a charge or other security interest on any property of a corporation; and other transactions relating to a company's business or assets. However, transactions involving instruments directly or indirectly linked to Seychelles real estate will be subject to stamp duty.

Other Taxes – There is no capital gains tax, property tax, inheritance tax or property tax, capital transfer tax, gift tax or wealth tax in Seychelles. The main tax on resident individuals is the Seychelles income tax with a maximum rate of 15%.

There is 15% VAT levied on the supply of goods and the provision of services.

Country code: SC

Legal basis: Mixed (civil law and common law)

Legal Framework: International Business Companies Act, 2016 (as amended)

Company form: International Business Company (IBC) (Private Joint Stock Company)

Liability: The shareholder's liability for the company is limited to the amount of their respective holdings.

Share capital: No minimum subscribed and paid-up capital is required and can be denominated in any currency. The amount of the authorized capital can be determined freely at the time of incorporation.

Shares may only be issued as registered shares and each of these may be designated as voting shares, non-voting shares, shares with more or less than one vote per share, shares which can only be voted on certain matters or upon the occurrence of certain events, shares that can be voted on only if held by persons who meet certain requirements, shares of no par value, unnumbered shares, ordinary shares, preferred shares, redeemable shares and shares that give the right to participate only in certain assets. A Seychelles IBC cannot issue bearer shares.

Shareholders: An IBC can be formed by a minimum of one shareholder who may be an individual or a legal entity, resident or non-resident, without restriction. Shareholder details are not made public.

Directors: At least one director is required, who may be a natural or legal person, resident or non-resident, and who may be the sole shareholder. Admin details are not publicly available.

Secretary: The appointment of officers such as a secretary is optional and may be a natural or legal person, resident or non-resident.

Registered address: An IBC must have a registered office in Seychelles, provided by an authorized registered agent.

General meeting: The annual general meeting of shareholders is not mandatory and can be held anywhere. Meetings may be held by telephone or other electronic means; alternatively, the directors, as well as the shareholders, can vote by proxy.

Electronic signature: Allowed.

Re-domiciliation: A foreign entity can be re-domiciled as a Seychelles IBC and vice versa.

Compliance: IBCs must keep accounting records, which can be kept anywhere and in any currency. Financial accounts do not need to be filed and there is no need to file an annual or tax return for Seychelles companies operating outside Seychelles. If an IBC does business with Seychelles residents, it must notify the Registry, submit audited annual accounts and tax returns, and pay local taxes.

In addition to opening your Seychelles Offshore, you will probably be interested in creating a life insurance policy on your taxation, taking up a second tax residence, in a country with territorial taxation, such as a residence in Panama or a residence in Paraguay

Also consider a company in Panama