Seychelles is a member of the 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 $25 million in revenue annually. For a country with a GDP of approximately $2 billion, this is a significant source of income.

Seychelles authorities have said the island nation is at low risk of money laundering because it is very remote and its banking sector is not particularly large.

The ESAAMLG highlights in its report that corporate service providers (CSPs), despite the legal obligation to do so, often do not know the beneficial owner of IBCs, particularly for IBCs sold through foreign dealers/intermediaries. The report also states that there is a very poor definition of what constitutes a beneficial owner.

Overall, significant due diligence gaps were identified. This makes it a particularly attractive destination for many clients who want to legally conceal their identity behind a Seychelles IBC.

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 corporate formations in the world and the lowest annual government taxes.

International Business Companies are considered resident for tax purposes but are subject to a territorial tax system, meaning income earned from foreign sources is not subject to tax.

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

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

IBCs are not required to file an annual return or financial statements, provided they do not derive income from the Seychelles.

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

Seychelles Offshore Companies, Types of Business and Controls

Seychelles offshore companies are commonly used for estate planning, asset management, as well as holding and conducting international trade.

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

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 derive from non-Seychelles income. There is no capital gains tax in the Seychelles.

IBCs are exempt from stamp duty on the incorporation of a company, transfers of ownership to or from a company, transactions involving 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 company; and other transactions relating to the business or assets of a company. However, transactions involving instruments directly or indirectly related to real estate in the Seychelles will be subject to stamp duty.

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

There is a 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)

Corporate 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: There is no minimum subscribed and paid-up capital requirement and it can be denominated in any currency. The amount of authorized capital can be freely determined at the time of incorporation.

Shares may be issued only 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 that can only be voted on certain matters or upon the occurrence of certain events, shares that can only be voted if held by persons meeting certain requirements, shares without par value, unnumbered shares, ordinary shares, preference shares, redeemable shares, and shares that entitle the holder to participate only in certain assets. A Seychelles IBC cannot issue bearer shares.

Shareholders: An IBC can consist of at least one shareholder, who can be a natural or legal person, 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. Director details are not publicly available.

Secretary: The appointment of officials 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 the Seychelles, provided by an authorised 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, directors and shareholders may 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 maintain accounting records, which can be held anywhere and in any currency. Financial accounts are not required to be archived, and annual or tax returns are not required for Seychelles companies operating outside the 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 offshore company in the Seychelles, you will probably be interested in creating a life insurance policy on your tax situation by taking 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