Business in Barbados

Formal establishment begins with choosing between a sole trader, partnership, Limited Partnership, Company, or registration of an external company incorporated outside Barbados. Sole traders and partnerships are registered under the Registration of Business Names Act. A Company is created under the Companies Act as a separate legal person; a person under 18, a bankrupt person, or a person declared mentally incapable by a court cannot form a Company. In principle, one Director is sufficient for a Company, and the CAIPO source reviewed does not state a minimum capital requirement. The Corporate Affairs and Intellectual Property Office (CAIPO) reserves business names using Form 33 for BDS $30, generally within about two working days and for 90 days. Applicants may provide up to three name options. The name must not be identical or confusingly similar to an existing name and, for a Company, requires an appropriate designation such as Ltd, Corp or Inc. According to the factsheet, forming a Company costs BDS $750 plus BDS $30 for name reservation and takes approximately five working days or less when the documents are complete. The documents include Form 33, the integrated Form 1, notice of the registered office using Form 4, notice of Directors using Form 9, and the required declarations. Anyone operating as a sole trader or under a business name without a genuine surname or partner name generally registers the business name within 14 days after starting business, using Form 1. Changes to the registered information must also be filed within 14 days. A Limited Partnership is registered with CAIPO and costs BDS $2,400 according to the factsheet. An external company, meaning a company incorporated outside Barbados, must register with CAIPO before conducting business in Barbados. After structural registration comes registration with the Barbados Revenue Authority (BRA). The BRA issues a 13-digit Tax Identification Number through the Tax Administration Management Information System (TAMIS). This number is used for trade, tax returns and payments. Integrated registration through Business Barbados may additionally combine TIN and TAMIS registration, the Small Business Licence, registration with Customs and Excise, and the NISSS number. The information requested includes, among other things, the start of business, turnover, foreign-exchange earnings, assets, employees, exports and ownership details. The reviewed sources do not establish one general Business Licence for every activity. Depending on the business model, approvals may also be required from the Planning and Development Department, the Ministry of Health and Wellness, Customs and Excise, or a specialized authority. Using or developing land may require planning permission. Environmental Health reviews and licenses, among other businesses, hotels, restaurants, bakeries, supermarkets and hairdressing businesses. For cross-border trade, digital import and export licenses, approvals and certificates are handled through BeSWIFT. Financial institutions and insurance companies require the relevant sector approval, such as approval from the Central Bank of Barbados or the Financial Services Commission. A Company additionally registers for Value Added Tax, or VAT, when annual taxable turnover reaches at least BDS $200,000 or monthly turnover exceeds BDS $16,666.67. Registration is required for public entertainment promoters regardless of these thresholds. The standard rate is 17.5 percent; direct tourist accommodation is taxed at 7.5 percent and telecommunications at 22 percent. Some supplies may be zero-rated or exempt. The BRA charges Corporation Tax, or CIT, on a Company’s profits. For taxable income up to BDS $1,000,000, the current rate is 5.5 percent; for more than BDS $1,000,000 up to BDS $20,000,000, it is 3 percent; up to BDS $30,000,000, 2.5 percent; and above that, 1 percent. Special rules apply, among others, to insurance companies and certain grandfathered entities. For a corporation resident in Barbados, tax residence is determined by management and control; worldwide income may then be relevant. For a non-resident corporation, taxation concerns Barbados-derived income. The tax return and any balance due are generally payable by 15 March of the following year when the financial year ends between 1 January and 30 September. When the financial year ends between 1 October and 31 December, the general deadline is 15 June of the following year. Instalment payments depend on the financial year-end, and financial statements are supporting documents. Administrative extensions granted by the BRA must be checked separately and for the relevant period. The Small Business Development Act 1999-23 and BRA rules may create special tax and support consequences for qualifying businesses. For the 5.5-percent CIT rate from income year 2024, the BRA lists, among other criteria, gross income of no more than BDS $2,000,000, paid-up capital of no more than BDS $1,000,000, no more than 25 employees, and at least 75 percent beneficial ownership by shareholders resident in Barbados. Certain FCP Holders, holding companies and other concession entities are excluded. According to a BRA notice, an approved Small Business with gross income of no more than BDS $2,000,000 may be exempt from monthly CIT instalments in 2025. The CAIPO application fee for Small Business status is BDS $100. Export Barbados, formerly the Barbados Investment and Development Corporation, supports business development, exports, innovation, export certification, and market and network access, among other areas. Invest Barbados coordinates international investment attraction and cooperation with public authorities. FundAccess provides micro- and small-business financing, training and technical support. According to the factsheet, Business Facilitator loans range from BDS $1,000 to BDS $100,000, with an annual interest rate of 7 percent, a term of 1 to 10 years, and a moratorium of 1 to 3 months. Access is available, among others, to legal permanent residents with a viable business, appropriate know-how and an equity contribution. For amounts above BDS $50,000, FundAccess requires a business plan, financial documents and cash-flow projections; an administration fee of 3 percent up to a maximum of BDS $3,000 also applies, and security may be required. According to Invest Barbados, foreign ownership is generally not excluded. However, a non-Barbadian founder who wishes to work in Barbados must register with the Immigration Department before starting and apply for the required work permit. Supporting documents may include the transfer of investment funds under Central Bank of Barbados rules, the CAIPO Certificate and Articles, and relevant licenses. The application costs BDS $300; the final fee depends on the category and duration. A business whose income is exclusively in foreign currency must check with the International Business Unit whether a Foreign Currency Permit, or FCP, is required. The FCP and sector licenses do not arise automatically from incorporation. A Company needs a registered office in Barbados and keeps there, among other things, its Articles and By-laws, minutes and resolutions, shareholder register, Directors’ and office notices, accounting records, and beneficial-ownership information. Domestic Companies file Form 35 annually. For incorporations from 1 January to 30 June, the deadline is 30 June of the following year; for incorporations from 1 July to 31 December, it is 31 December of the following year. Late filing costs BDS $10 per day up to a maximum of BDS $3,000. If a filing is not made, the Registrar may arrange a strike-off; restoration may be possible afterward under certain conditions. Registration alone does not permit every operational activity. A trademark may be registered with CAIPO. Registration is not mandatory, but it strengthens enforcement against infringement. Protection lasts for ten years and may be renewed for further ten-year periods; according to the factsheet, renewal costs BDS $50 per class. TM is used before registration, and ® may be used after the Certificate has been issued. Trademarks, patents, designs and copyrights may be licensed or transferred as economic assets. For contracts with public authorities, free vendor registration is required before concluding a procurement contract. When purchasing a business name, changes to the registered information or a notice of termination are included in the purchase process. Termination of a business name must be reported within three months using Form 4; the fee for termination or amendment is BDS $50. A transfer of Company shares requires a written instrument naming the transferee. The instrument must be submitted to the Registrar within 30 days for assessment of Property Transfer Tax and Stamp Duty. Ownership and beneficial-ownership information are then updated. The purchase agreement, review of tax and permit risks, and transferability of sector approvals remain separate matters for review. Two or more Companies may be combined into one company by amalgamation under Sections 206 to 212 of the Companies Act. Form 15 is used; in a long-form amalgamation, an Amalgamation Agreement and special resolutions are additionally required, while vertical or horizontal short-form procedures use Directors’ resolutions. In a continuance, a company may move its registered office to Barbados or leave Barbados. The procedure uses, among other documents, Form 17, Form 33, Form 4 and Form 9; assets, liabilities, claims and proceedings remain in place. After a discontinuance, the company continues as an external company. For the voluntary closure of a Company without shares, the Directors’ resolution, Form 23, and letters from Inland Revenue and NIS are filed. For a Company without assets or liabilities, a special resolution of the shareholders and a statutory declaration are added. In a voluntary liquidation, Form 25, notice of intention, notices to creditors, publication in the Gazette or a newspaper, and the handling of assets and liabilities are followed by filing Form 23. The Company ends on the date of the Certificate. Business records are retained for six years. A business name is deregistered within three months after termination. The Registrar may strike off a Company, among other reasons, if it has not started business within three years, has not carried on business for three consecutive years, or has not been restored within two years after the strike-off.