Invest Barbados



International Banking

 

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International banks are governed by the International Financial Services Act, Cap 325 and are authorized under the Act to:

 

  • Receive foreign funds through:
    • The acceptance of foreign money deposits payable upon demand or after a fixed period or after notice
    • The sale or placement of foreign bonds, foreign certificates, foreign notes or other foreign debt obligations or other foreign securities
    • Any other similar activity involving foreign money or foreign securities
  • Use the foreign funds so acquired, either in whole or in part, for:
    • Loans, advances and investments
    • The activities of the international bank for its account of or at its risk
    • The purchase or placement of foreign bonds, foreign certificates, notes or other foreign debt obligations or other foreign securities
    • Any other similar activity involving foreign money or foreign securities
  • Accept in trust from persons resident outside of Barbados or from prescribed persons
    • Amounts of money in foreign currencies or securities or both
    • Foreign personal or foreign movable property
    • Foreign real or foreign immovable property

 

Why Locate an International Bank in Barbados


The benefits of operating an international bank in Barbados include:

 

  1. Tax rates ranging from 2.5% to 0.25% based on levels of income
  2. Foreign tax credit election available, subject to a minimum Barbados tax of 0.25%
  3. No withholding tax on dividends, interest and other payments made to non-residents of Barbados
  4. No capital gains tax
  5. No tax on income from property where returns are beneficially owned by another licensee or by a non-resident person
  6. No duty or tax on the transfer of assets from a licensee to another licensee or to a non-resident person
  7. Exemption from exchange control restrictions
  8. Tax concessions for specially qualified employees
  9.   Guarantees regarding the future taxing of a licensee

Total number of international banks

 

As at December 31, 2011 the total number of licensed international banks was 45 (Barbados Economic and Social Report).

 

What are the formation requirements?

 

  • A prospective applicant must submit a preliminary application to the Central Bank of Barbados for approval. The application for a licence must include a brief description of the nature of the international financial service to be provided from Barbados, financial projections, the names and addresses of the directors, names and addresses of the shareholders and the number of shares to be held, together with other due diligence information.  After the submission is appraised, consent is obtained from the Minister of Finance for the incorporation or registration of company in Barbados. A final application must be made to the Director of Bank Supervision who, subject to the approval of the Minister of Finance, may issue a license to the company to carry on international financial services.
  • The company must also have a minimum assigned capital of US$2,000,000 if the bank is authorised to accept third party deposits or a minimum assigned capital of US$500,000 if the bank does not accept third party deposits. The minister may at his discretion alter the above sums.

 

What are the annual requirements of an IFSC

 

  • A license must be renewed annually by January 1, of each year
  • Annual audit required
  • Annual returns to be filed by January 31, of each year, subject to penalties
  • Annual filing of audited financial statements
  • Submission of quarterly statements of a licensee's assets and liabilities to the Central Bank
  • Annual tax returns must be filed with the Department of Inland Revenue

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