Business Guide – Belize
Guide to Doing Business in Belize
I. BELIZE COUNTRY AT A GLANCE
A. What languages are spoken?
Belizeans speak a variety of languages. The official (business) language is English. However, Spanish is also widely spoken. Creole is the cultural language of the country and is spoken nationwide. There are also a number of indigenous languages such as the Garifuna and three variations of the Mayan language.
B. What is the exchange rate of the Belize dollar versus the U.S. dollar?
1 U.S. dollar – 2.00 BZ dollars
C. Describe Belize geography, proximity to other countries and climate.
Belize is located on the Caribbean seaboard of Central America, bounded on the North by Mexico and on the West and South by Guatemala. The land area is about 22,923 kilometers square. It is a mere 2-hours flight from Miami, Houston, Dallas, New Orleans and Los Angeles. Belize enjoys a sub-tropical climate, i.e. experiences rainy and dry seasons.
D. Are there cultural influences or prohibitions on the way business is conducted?
It cannot be said that there exist any cultural prohibitions which affect the conduct of business. With regard to influences, previously the cultural or ethnic background influenced a person’s field of work or profession in that some ethnic groups were more inclined to certain sectors of work. Today, however, ethnic lines have grown thin and this is no longer the case.
E. Are there religious influences or prohibitions on the way business is conducted?
Though religion plays a major role in people’s personal lives, its impact on the business sector cannot be said to be a significant one. For instance, gambling is adamantly condemned by the church but this has not prevented the establishment of casinos and game rooms in the various districts.
F. Explain your country’s infrastructure. Be sure to explain which cities have airports, railroad systems, ports, public transportation.
Belize City recently underwent vast development through an infrastructure project. Most of the major highways are paved. Majority of the roads in the two cities and 7 towns are paved. However many of the roads in the rural areas remain unpaved. There is one international airport located 8 miles WNW of Belize City and there are smaller airstrips in the various districts to facilitate domestic air travel. The three main ports in the country are situated at Belize City, Big Creek and Dangriga. There is one main bus company which provides transportation throughout the six districts and minor bus service providers in the various localities. There is also a marine terminal in Belize City which provides water taxis to the cayes.
G. Explain the communications system
Telecommunications is provided by a monopoly company – Belize Telecommunications Ltd. All automatic systems: Direct dialing with major countries in the world. Telexes, faxes, cellular, email and internet is also readily available.
H. Describe the public services – water, electricity, gas. Are they publicly or privately owned?
Both the Belize Water & Sewerage Authority and Belize Electricity Ltd. have predominantly private shareholders and government owns few shares. Esso is the one gas importer but there are a number of retailers – Texaco, Shell.
II. GENERAL CONSIDERATIONS
A. Investment policies
1. Does the country generally welcome investment? Are there governmental or private agencies devoted to the promotion of investment?
The country generally welcomes investment. Investment is monitored and facilitated through the Ministry of Investment & Trade as well as Beltraide – a statutory body whose main object is attracting and facilitating new investment.
2. What is the rate of inflation?
Inflation is calculated 4 times per year (every three months) on all items. In Feb 2003 – rate was 3.5 and in May 2003 – 2.2.
3. Explain any sector exceptions, incentives or restrictions on foreign investment?
There are no restrictions on investment as long as activities remain within the bounds of the law. Incentives: EPZ – Export Processing Zones Program, Fiscal Incentives Program Commercial Free Zones Repatriation of Profits and Dividends
4. Describe de facto restrictions on investments, if any, such as bureaucratic discretion.
None
5. What are the sizes of the different markets? The population size is approximately 250,000 persons.
6. What types of businesses are conducted in the country?
A wide range of business such as: legal practice, engineering, medical practice, agricultural production, meat processing, educational, banking, fisheries, mercantilism, peddling, handicraft, data processing, services, hoteliers, restaurateurs, and many others.
B. Diplomatic Relations
1. Explain any established diplomatic relations your country may have.
Belize is a member of the United Nations (UN), the British Commonwealth, the Non-aligned Movement, the International Monetary Fund (IMF), the Organization of American States (OAS), the World Bank, Caribbean Development Bank, Inter-American Development Bank.
2. Give addresses, telephone numbers for the embassies or consulates in your country?
British High Commission – Embassy Square, Belmopan City, Tel – 501-822-0811
Consulate of the Netherlands – 14 Central American Blvd./Banak St. Belize City, Tel – 501-227- 5663
Embassy of Costa Rica – 49 Hummingbird Hwy, Belmopan City, Tel – 501-822-3801
Embassy of Venezuela – 19 Orchid Garden, Belmopan City, Tel – 501-822-2789
Mexican Embassy – 18 North Park St., Belize City, Tel – 501-223-0193
United States of America Embassy – 29 Gabourel Lane, Belize City, Tel – 501-227-7161
3. Are there prohibitions or restrictions on certain business dealings with the country?
No, but there are licenses and permits that are required to conduct certain types of businesses and these permits are subject to yearly fees.
4. Explain travel restrictions to or within the country?
A valid passport is required of all visitors. Citizens of the UK, EU, US, Mexico, CARICOM, Costa Rica and some Commonwealth countries are not required to have visas to enter Belize, but must have a return ticket. Citizens of other countries require visas which can be obtained from a Belize Consulate or Embassy in their respective countries or if there is none, from the nearest British Embassy. Visa fees are US$25.00.
C. Government
1. Explain your country’s election system and schedule. Is there an anticipated change in the present government?
Belize has a democratically elected government. Elections are held at intervals of not more than 5 yrs. and there are 2 major competing political parties. Elections are based on a first-past-the post system. The voting age is 18 yrs. It is uncertain whether there will be a change of government in the next elections since this is 4 ½ years away; it is too soon to call.
2. Is the present government stable? Briefly explain your country’s political history in the last decade?
The most recent elections took place in March 2003 in which the People’s United Party (PUP) won 22 seats and the United Democratic Party (UDP) won 7 seats in the House of Representatives. Prior to this, elections were held in August 1998 wherein the PUP won 26 seats and the UDP won the remaining 3 seats. The PUP appears to have a stronghold over the country and the fact that they have been voted back into government for a second consecutive term implies that Belizeans consider them to be the better of the two parties. Elections take place under generally peaceful conditions.
3. Explain your country’s judicial system. Answer the following Questions.
Is the judicial system generally perceived to be impartial? Yes
Must disputes be resolved in the country? Generally, Yes
Is there a political method of resolving disputes? For International disputes there is a system of negotiation.
Are there alternative methods of resolving disputes? Yes, arbitration exists and the introduction of mediation is being contemplated currently.
How long does it take to resolve disputes? Time span varies; about 1-5 years depending on its nature.
Can foreign judicial decisions be enforced in the country? Only UK decisions or decisions from countries with whom Belize has a Reciprocal Enforcement Agreement.
Are there separate tribunals depending upon the subject matter of the case? We have only one legal system that is based on the English Common Law. Our courts deal with both criminal and civil matters and the court is of the same make up for both types of matters. Family matters are dealt with separately by the Family Court.
Are there different legal systems within the country or its political subdivision? No
Can the investor choose to be subject to the country’s jurisdiction or not? Jurisdiction over a person is usually based on presence. Therefore, mere presence in the jurisdiction would make the person subject thereto. An investor may set up a company which may chose its governing law. Also, an investor can transact via contracts which have jurisdiction clauses if he/she wishes to subject to a specific jurisdiction.
4. Explain your country’s legislative system.
Legislative authority is vested in the National Assembly which is comprised of a democratically elected House of Representatives and a nominated Senate.
D. Environmental Considerations
1. What is the public / government attitude toward environmental regulation?
Environmental awareness is becoming more prevalent amongst the Belizean public and government. However, the government still seems to be more pro-development whilst the general public is resistant to any development that will have adverse effects on the environment. Despite the differing priorities, both government and citizens are trying to work towards sustainable development.
2. Explain any environmental regulations.
The Environmental Protection Act – establishes the Department of the Environment and Provides for the preparation of other regulations: (1) Effluent Limitation Regulation; (2) Environmental Impact Assessment Regulation; (3) Pollution Regulation; (4) Solid Waste Management Authority Act; (5) Summary Jurisdiction Act – Littering- Litter Offence & Violation Tickets.
III. INVESTMENT INCENTIVES
A. Explain any export incentives or guarantees. Answer the following questions.
Are there tax incentives for exports? Yes
If so, are they limited to certain types of products? No, but 60% of the product must originate in Belize.
Is export financing available from government or private sources? Yes, available from government.
If so, what forms of financing or guarantees are available? EPZs
Is there any governmental insurance for exports? No
Must a national be a participant in the enterprise in order for the investor to benefit from these incentives? No
B. Explain any grants, subsidies or funds your country offers foreign investors. Answer the following Questions.Are grants and subsidies restricted by the type of activity? There aren’t any grants and subsidies because Foreign Investment means that finance is brought into the country by the investor. Government assistance is usually via tax breaks or tax holidays.
C. Explain any national tax incentives for foreign investors. Answer the following Questions.Are the incentives restricted by the type of activity? The main incentives for foreign investors are via: EPZs – Export Processing Zones, Fiscal Incentives Program and Commercial Free Zones. Export Processing Zones benefits, as the name suggests, is limited to products for export purposes. The type of activity the investor engages in affects the incentives available since government grants incentives mainly to ventures related to tourism, agriculture, and the manufacture of products. Commercial Free Zones pay 2% tax on gross profits and this is only available for non-residents.
D. Explain any regional tax incentives open to foreign investors. Answer the following Questions.Are there tax incentives for the investor that exist only in certain regions of the country? Yes, to avail oneself of the CFZ benefits, business must be set up in one such zone.Does the investor need to receive approval to be eligible for these incentives? YesAre the incentives restricted by the type of activity? YesWhat does the process of application involve? To qualify for Fiscal Incentives, the Company must be incorporated under the laws of Belize and its activities must be beneficial to the economy and public interest. To apply, a project proposal must be submitted in triplicate to the Belize Trade and Investment Development Service (BELTRAIDE) along with the following supporting documents: (1) Copy of the Company’s Articles of Association; (2) Copy of Memorandum of Association; (3) Copy of Certificate of Incorporation; (4) Banker’s reference; (5) Land Title; (6) Proforma Profitability Statement; (7) List of items requested for duty exemption.
IV FINANCIAL FACILITIESWhat kind of financial institutions exist? There are 5 commercial banks: The Belize Bank Ltd.; Barclays Bank PLC; The Bank of Nova Scotia, Atlantic Bank Ltd; and the Alliance Bank. There is also a Government savings bank. Offshore banking is also carried on.Must an investor maintain a bank account in the country? NoWhat are the requirements for opening a bank account? Letter of reference from a bank in the investor’s home country, a valid form of identification and at least $200.00What are the restrictions, if any on the investor’s use of the account? There are no restrictions per se but the bank reserves the right to reject any transactions that do not appear legitimate on the face.What is the type of financial system in the country? Free market financial system.How is the banking system structured? There is a Central Bank which deals with monetary policy and Domestic and International unit banks and branches.Is there a stock market? NoCan the investor receive bank loans? Yes, subject to Central Bank Approval.
V. EXCHANGE CONTROLS
1. Business Transactions with Nationals, Residents or Non-ResidentsHow are nationals, residents and non-residents defined? Nationals, referred to under law as Citizens are persons born in Belize, or persons naturalized or registered under the relevant Act. A resident is a person who has been residing in Belize in excess of 6 months.Are there restrictions on conducting business with nationals, residents and non-residents? NoAre there reporting requirements? Yes, if the bank so requests, all monies coming into the account must be accounted for. This information remains with the bank alone.Can the investor receive loans from nationals, residents or non-residents? Yes
2. Investment controlsAre there restrictions on direct investment in the country? No, except that you must bring the finance.Are there restrictions on indirect investment in the country? Must the investor make declarations regarding the nature of his business? Yes
3. Money Transfer
Is there free determination of exchange rates? The exchange rate is fixed at BZ$2-US$1
Are there restrictions on the transfer of money into and out of the country? No
Are there restrictions on the remittance of profits abroad? No
Are there reporting requirements? Yes
Can hard currency be taken out of the country? Yes, up to a certain amount permitted under the Money Laundering Act.
VI. IMPORT / EXPORT REGULATIONS
1. Customs Regulations
Is the country a member of GATT? Belize is a member of WTO
Is the country a member of the EEC? No
Is the country a party to a regional trade agreement? Belize is party to NAFTA and CARIFTA. Belize has preferential market access to the Caribbean Community under CARICOM, preferential treatment from the US under the Caribbean Basin Initiative, and Belizean goods enter duty free in Canada under CARIBCAN.Does the customs department value the goods? Yes, they value all imports and levy a duty that is flexible and 8% sales tax that is fixed.How are the goods cleared through customs? If goods are shipped via a vessel, the person must get relevant documents from the shipping Company or if goods are sent by air, the person must have an airway bill and take this to the Customs Department. If the value of the goods exceed BZ$200.00, then the person must pay a broker to clear them, otherwise the person may clear them himself. Once documents are taken to the Department, the goods are valued by a customs officer who in turn levies charges if they are taxable. After the person pays the cashier the duties he/she can take possession of the goods.Are there applicable tariffs? ———————————————————-
2. ExportsAre there restrictions on exports? Yes, for instance, on some agricultural products like herbs and fishery licenses are required.Are export licenses required? Yes, export licenses are required for certain goods such as lumber, beans, rice, sugar, live animals (including pets), citrus, fishery excluding aquaculture species etc.Are there applicable export duties? Yes, in relation to certain products.
3. Foreign Trade RegulationsAre there foreign trade regulations on the import or export of goods involved in the business? Yes
4. ImportsAre import licenses required? Yes, import licenses are required prior to importation of the following products such as beans, bleaching agents, eggs, flour, fruit & vegetables, furniture of wood, cane, osier, bamboo, rattan or similar material, fuel, poultry, wearing apparel for commercial purposes, gases, soaps, matches, dry pasta products, toilet tissue, outboard motorboats of fiberglass, peanuts…Are there applicable import duties? YesAre there applicable import quotas? NoAre there applicable import barriers? Yes
5. Manufacturing Requirements?Must the product contain ingredients or components which are found or produced only in the country? No, but for the product to be exempted from tax under CARICOM agreements a greater percentage of the raw materials must originate within the country.Will the importation of certain component parts be permitted only if they are to be ultimately incorporated into a final product? No
6. Product LabelingAre there applicable labeling or packaging requirements. Yes, but labeling requirements vary depending on the type of product. These basically involve ingredients, expiry date, safety warnings.
VII STRUCTURES FOR DOING BUSINESS
1. Government ParticipationWill the government seek to participate in the ownership or operation of the entity (e.g. depending on the type of activity involved)? As long as the business operates within the bounds of the law and does not conduct business which impacts Belizean society negatively, the government will have no ground for interference. If government intervention is necessary, this will only be done to the extent warranted by the activities of the business.What is the investor’s potential liability to partners, investors or others? Unlimited liabilityAre there restrictions on capitalization? NoWhat are the investor’s tax consequences? No
2. Joint Ventures
Are joint ventures permitted? Yes. What is the registration procedure? No need for registration; they can be created by contract.
How long do these procedures take? N.A.
What costs and fees are involved? N.A.
Must a national of the country be a participant, manager or director? No
What is the investor’s potential liability? There is unlimited personal liability on any of the business owners.
Are there restrictions on capitalization? No
What are the investor’s tax consequences? Taxes are on income and sales tax (8%) is charged on goods and services.
3. Limited Liability Companies
Are limited liability companies permitted? No
I f so, how are they registered or incorporated? N.A.
How long do these procedures take? N.A.
What costs and fees are involved? N.A.
Must a national of the country or a related state be a participant, manager or director? N.A.
Are there restrictions on capitalization? N.A.
What are the investor’s tax consequences? N.A.
4. Liability Companies, Unlimited
What are the forms of liability companies? Public and Private Companies
How are these companies registered or incorporated? It is registered by the Registrar General who issues a certificate of incorporation after procedure has been compiled. It can be done in a week’s time.
How long do these procedures take? 5 days
What costs and fees are involved? Cost is U.S. $800.00
Must a national of the country be a participant, manager or director? No
5. Partnerships, General or Limited
Are partnerships recognized or permitted? Yes
Must a national of the country or related state be a partner? No
If so, to what extent? N.A.
What costs and fees are involved? U.S. $50.00- $300.00
What is the investor’s potential liability? He is personally liable for all acts done in the name of the partnership.
What are the investor’s tax consequences? Personal income tax and business tax are the major taxes.
6. Partnerships, Undisclosed Do undisclosed Partnerships exist? There are no provisions for undisclosed partnership in our laws.
7. Sole Proprietorships
Can the investor be a sole proprietor? A foreigner can enter into a sole ownership business
How is the sole proprietorship registered or established? No need for registration but if his business name does not carry his last name he must register it under the Business Name Act CAP.204 of the laws of Belize.
How long does this process take? The process of registration takes one week.
What costs and fees are involved? The cost is U.S. $100.00-$250.00 via a legal representative.
What is the investor’s potential liability? He is personally liable for all debts incurred by the business.
Are there restrictions on Capitalization? An investor can invest any amount under U.S. 10,000.00 without Central Bank Approval
What are the investor’s tax consequences? Taxes are on income and sales tax (8%) is charged on goods and services.
8. Subsidiaries/Branches/Representative Offices
Can the investor establish a branch, subsidiary or representative office? Yes, foreign Companies can have a place of Business in Belize with a registered agent.
If so, how long does registration or incorporation take? The process takes about two weeks. An attorney or an accountant is normally used.
What costs and fees are involved? The fees range from U.S. $1,000.00 to U.S.$ 2,500.00
What is the investor’s potential liability?—————————————————–
Must a national of the country be a participant, manager or director? There is no requirement for a Belizean to be a part of the company.
Are there restrictions on capitalization? No
What are the investor’s tax consequences?
Are these tax consequences different than those of a local company? No
9. Trusts and Other Fiduciary Entities
Are trusts or other Fiduciary entities recognized? Yes
If so, how are each defined? These are governed by a contractual trust instrument.
What are the legal consequences of a transfer of assets to a trust or fiduciary? Transfer tax 5% – 10% on value of assets. The legal title would be vested in the trust or fiduciary who would hold the assets on trust for the beneficiary.
Can the investor be the grantor, trustee or beneficiary? Yes
VIII. REQUIREMENTS FOR THE ESTABLISHMENT OF A BUSINESS
1. Alien Business Law
Is the business subject to any alien business law? No
Are there registrations or reporting requirements? Yes, domestic and IBC need to be registered; other businesses require Trade license or practicing certificate
2. Antitrust laws
Do the entity’s operations comply with anti-trust laws? No (but there is a bill in process which has anti trust provisions).
Are there filing requirements? No
3. Environmental Regulations Is the Business of the investor subject to environmental regulation? If so, are there added costs involved (e.g. audit requirements)? Yes, the Tourism Board, Audubon Society and the Ministry of Natural Resources and environment and other NGO’s have environmental law and policies that must be followed.
4. Government Approvals
Are government approvals required for the anticipated Business? No
If so, how long does this process take? N.A.
What fees are involved? N.A.
5. Insurance
Must the enterprise carry insurance? Not obligatory, but it is highly recommended. If the business is one of carriage, insurance is required.
If so, what kind of risks must be insured? N.A.
Is there a state monopoly on insurance? No, we have about six private insurance providers.
6. Licenses/Permits
Are licenses or permits required for the anticipated activity? A trade license is required.
If so, how does the investor apply for and receive the necessary license or permit? By application to the local authority.
How long does it take to receive the license or permit? Trade license takes about 1-2 days
IX. OPERATION OF THE BUSINESS
1. AdvertisingAre there restrictions on advertising? No, but there are general principles of good faith that are applicable.
2. Attorneys
Is it necessary to have local counsel? NO, but it is highly recommended.
How can local counsel be found? Telephone directory yellow pages, Internet.
How much are attorney’s fees? U.S.$50.00- U.S. $200.00 per hour.
3. Bookkeeping Requirements
Must the investors keep local books of Accounts? Yes, for income and business tax purposes
In what form must the investor keep accounts (e.g. GAPP, in what language, etc.)? Yes, and these are kept in English
4. Business Ethics/CodesAre there certain business ethics or codes which the investor must follow (e.g. GAAP for accountants, etc.)? These apply only in terms of professional organizations, but must observe laws of country.
5. Consumer Protection LawsAre there consumer protection laws, which apply to the investor’s operations? Belize has laws such as the Standards Act, Sale of Goods Act, Hire Purchase Act, Weights & Measures Act, and Supplies Control Act which deal with consumer protection regulation.
6. Construction
What are the costs of construction? U.S. $50.00-U.S.$100.00 per ft.
Are permits required for construction? Only if it involves construction in urban areas
How is authorization to construct obtained? By application to the Housing and Planning Department.
How long does it take to receive authorization? 1 – 4 week
What fees are involved? Fees vary depending on the size of the building and its nature i.e. whether it is for commercial or residential purposes.
7. Contracts
Can the investor freely enter into local contracts? Yes
Can the contracts be governed by the law of another country? Yes
8. Price Controls
Are there applicable price controls? Generally there are no price controls, however there is a Supplies Control Act but this only applies to limited products such as fuel.
9. Product Registration
Must the entity register its product? Registration is not necessary but one may register trade marks and patents.
If so, how is registration obtained? Registration of patents and trade marks is done by application to the Belize Intellectual Property Office
How long does the process take? 3 weeks
Are there fees involved? U.S.$300.00 –U.S.$700.00
10. Reduction or Return on Capital
Can capital be repatriated while the corporation is still ongoing? Yes
11. Sale of Goods
Are there restrictions on the manner, time or place of sale of goods? No except for liquor which is regulated by the Sale of Goods Act.
12. Trade Associations
Are there trade associations the investor can or must join? There is no obligation to join trade associations. However, the investor can join the Chamber of Commerce which normally keeps check on the business activities of its members and acts as an advocate for better treatment.
If so, are there fees involved? Nominal fees
Are there mandatory trade practices? No
X. CESSATION OR TERMINATION OF BUSINESS
1. Termination
What are the tax consequences of terminating the business? All taxes and rates owing should be paid up.
What costs are involved in termination? Company winding up either through court order or voluntarily can cost a lot depending on inventory size; minimum of $500.00
How long does it take to terminate the business? 3-6 months
How is the investor’s particular form of business treated in termination? Company liquidation or winding up
Can the business be terminated without government approval or termination? Yes
What are the tax consequences of termination? No tax consequence but accrued and outstanding taxes are payable on priority to the claims of creditors.
2. Insolvency/ Bankruptcy
What is the extent of the Investor’s Liability in the event of insolvency or bankruptcy? Creditors, employees and taxes must be paid up.
What choices, if any, are available to the investor with regard to the restructuring of the business? We do not have restructuring provisions.
XI. LABOR LEGISLATION, RELATION, AND SUPPLY
1. Employer/Employee Relations
What laws govern employer/Employee relations? Labor Act – CH. 297 of the Laws of Belize
Are there obligations to train employees? No obligation by law but to ensure productivity the employer usually does so.
2. Employment Regulations
Must the investor hire Nationals of the country? He is expected to do so as long as the human resources are available; if they are not, then he can bring in foreign employees.
Is there a minimum wage? Manual labour $2.25; Agriculture $2.00; Stores$1.75; Stores selling alcohol $2.25
Is there a maximum number of hours an employee can work each week? Max 45 hours weekly.
Is there a minimum number of vacation and sick days to be given? Vacation – 2 weeks; sick days with pay-16 days.
3. Hiring and Firing Requirements
Must the investor employ a minimum number of people? No, it depends on the type of Business to be carried on.
Must the investor employ a minimum number of Nationals? No, (same as above)
Must certain positions in the company be held by Nationals? No, however ethically foreigners shouldn’t be employed once nationals are qualified to hold those positions.
Are there rules to follow in hiring /dismissing personnel (e.g. Notice)? Yes, these are set out accordingly in the Labor Acts.
Does the investor have a continuing obligation towards dismissed employees? Not after vacation pay has been paid.
4. Labor Availability
Is adequate skilled or unskilled labor available for the anticipated business? There is a large pool of unskilled labor and the adequacy of skilled labor depends on the type of business.
5. Labor Permits
Are labor permits required? Yes
If so, how are they obtained? On application to the Labor department.
How long does the process take? 3-4 weeks.
What fees are involved? Labourer-$200.00 (see final page).
6. Safety Standards
Are there safety codes, which must be followed? Yes, there are safety and health standards that need to be complied with.
7. Unions
Are Unions recognized? Yes
What are the unions in the investor’s business? Trade Unions and Employer’s Organizations
What are these unions’ political affiliations, if any? None.
Is there an obligation on the part of the employer to organize unions? No.
Are there mandatory collective bargaining agreements for the business involved? No.
XII. TAX ON CORPORATIONS
1. Allowances
What are the major allowances (e.g. capital cost depreciation)? Business tax on gross income now applies.
What are the major deductible items? None.
What are the major expenses that are excluded from deductibility? None
2. Calculation of Taxes
How is the taxable base determined? Business tax 1-25% of the Gross income.
3. Capital Gains
What are the federal or national tax rates on capital gains? None
What are the regional or state taxes on capital gains? None
What are the municipal or local taxes on capital gains? None
4. Filing and Payment Requirements
When must the corporation file its tax returns? Monthly
When must the corporation pay its taxes? Monthly
Are taxes paid in installments or annually? Monthly
5. Miscellaneous Taxes Due
Is there a tax on capital? No
Is there a Business License Tax? Yes
Is there an Apprenticeship tax? No
Is there a training tax? No
Are there other taxes? Yes, Property Tax
What are the filing and payment requirements? Payments are annually.
6. Registration Duties
Are there registration duties due upon the incorporation of a company? Yes
Are there registration duties due upon an increase in capital? Yes
Are there registration duties due upon the transfer of the Company’s shares? Yes
Are there registration duties due upon a transfer of corporate assets? Yes
Are there any other registration duties due? Yes.
7. Sales Tax or other Turnover Tax
What is the system of Sales Tax (e.g. V.A.T., cumulative) No
Is input tax credible against input tax? N.A.
What are the tax Rates? 8% Sales Tax
What are the filing and payment requirements? Monthly
8. Social Security and Welfare System Contributions
Are social security contributions due? Yes
Are retirement or pension contributions due? Yes
Are unemployment insurance contributions due? No, but should be paid between jobs.
What are the filing and payment requirements for any such contribution? Monthly.
9. Special Tax Schemes
Are there particular tax consequences of doing business in the country? Business tax must be paid.
10. Tax on Profits
What are the federal or national income tax rates on profits?
What are the regional or state tax rates on profits?
What are the municipal or local tax rates on profits?
11. Tax Treaties
Are there any applicable tax treaties? Yes, UK/Belize, Belize / CARICOM
Are there any rules against treaty shopping? No
12. Territoriality Rules
Where is the corporation subject to tax? Only subject to taxation in Belize if income arises in Belize.
Is the corporation subject to tax on its worldwide income? No, only on income arising in Belize.
13. Treatment of Tax Losses
How are corporate tax losses treated? These are carried forward.
14. Wealth Tax
Is there an applicable wealth tax? No.
15. Withholding Taxes
What are the rates of withholding tax on dividends? 15% (but if payable to a non-resident there is a charge of 25% withholding tax).
What are the rates of withholding tax on royalties? None, What are the rates of withholding tax on interest? None (but if payable to a non-resident there is a charge of 25% withholding tax).
What are the rates of withholding tax on profits by a foreign corporation? None, corporation pays tax in Belize in the normal course of business.
XIII TAX ON INDIVIDUALS
1. Allowances
What are the major allowances? 19,600 and charity (up to 1/6 of chargeable income)
2. Calculation of Taxes
How is the taxable base determined? The tax is not on profits anymore.
3. Capital Gains Tax
Are capital gains taxable? No
4. Filing And Payment Requirements
When must the individual file a tax return, if any? Within the first 3 months of the following year.
When must the individual pay his taxes? PAYE – Pay As You Earn
5. Inheritance and Gift Tax
Does the individual’s presence in the country subject him to inheritance or gift tax? No.
What kinds of assets are subject to tax? None, only assets as part of a trade. Estate duty abolished in1991
What are the tax rates? They vary depending on assets.
Are allowances available? Yes
What are the payment and filing requirements? File at the end of the year
6. Miscellaneous Taxes Due
What are the miscellaneous taxes to which the individual may be subject? Indirect Taxes
What are the filing and payment requirement? None
7. Real Estate/Habitation Tax
Is the individual subject to real estate or habitation tax? 1% on the annual rental value or property.
8. Sales Tax
Does the individual pay sales tax? Yes, at point of consumption or sale (8%)
9. Social Security and welfare System Contributions
Are contributions to social security due? Yes
Are contributions to welfare system due? No
If so, what are the payment and filing requirements? *See attached schedule
10. Stock Option, Profit Sharing and Savings Plans
Is there taxation on stock option plans? N.A.
Is there taxation of profit sharing plans? N.A.
Is there taxation of savings plans? N.A.
11. Taxation of Benefits In Kind
What is the rate of taxation in benefits in kind (e.g. automobile, housing and utilities, education etc.)? 25%
12. Taxes on Dividends
Are dividends taxable regardless of their form? Yes
13. Tax on Income
What are the federal or national tax rates on income for residents? National tax of 25% after basic deduction19, 600.
What are the federal or national tax rates on income for non–residents? They are treated no different from residents once their income is taxable.
What are the regional or state tax rates on income for residents? N.A.
What are the regional or state tax rates on income for non-residents? N.A.
What are the municipal or local tax rates on income for residents? N.A.
What are the municipal or local tax rates on income for non-residents? N.A.
14. Tax Treaties
Are there any applicable tax treaties? Yes, treaties with the US and the UK
Are there any rules against treaty shopping? No
15. Territoriality Rules
Where is the individual subject tax? Where he is resident
Is the individual subject to tax on his worldwide income? No, only income earned in the country.
16. Wealth Tax
Is the individual subject to tax based upon his wealth? No
If so, what are the rates? N.A.
Are there any allowances available? N.A.
What are the payment and filing requirements? N.A.
17. Withholding Tax
Is salary subject to a withholding tax at the source? No
What is the treatment of residents as compared to non-residents? N.A.
XIV. TAX ON OTHER LEGAL BODIES
1. Allowance
What are the major allowances (e.g. capital cost depreciation)? Yes
What are the major deductible items? Cost, Salaries, Social Security, Insurance, labor and any other expense incurred in producing the income.
What are the major expenses that are excluded from deductibility? Expenses unrelated to producing income.
2. Calculation of Taxes
How is the taxable base determined? Gross income less major deductions = chargeable income.
3. Capital Gains
What are the federal or national tax rates on capital gains? N.A.
What are the regional or state taxes on capital gains? N.A.
What are the municipal or local taxes on capital gains? N.A.
4. Filing and Payment Requirements
When must the entity file a tax return, if any? At the end of the year
When must the entity pay its taxes? PAYE
Are taxes paid in installments or annually? N.A.
5. Miscellaneous taxes
Are other taxes due? No
What are the filing and payment requirements? Same as above
6. Registration Duties
Are there registration duties or fees due upon the setting up of the legal body? Yes
Are there registration duties or fees due upon a change in the capital of the legal body? Yes, Stamp duty is payable.
Are there registration duties due upon the transfer of capital? Yes, Stamp duty is payable.
Are there registration duties due upon a transfer of assets? Yes, Stamp duty is payable.
Are there any other registration duties due? No
7. Sales Tax or Other Turnover Tax
Is the legal body subject to sales tax or any turnover tax (e.g. VAT. cumulative)? Yes, Sales tax of 8%
Is input tax credible against output tax? N.A.
What are the tax rates? Sales Tax –8%
What are the filing and payment requirements? Monthly
8. Social Security and Welfare System Contributions
Are social security contributions due? Yes
Are retirement or pension contributions due? These are optional
Are unemployment insurance contributions due? No
What are the filing and payment requirements for any such contribution? N.A.
9. Special Tax Themes
Are there particular tax consequences of doing business in the country under the form of the particular legal body? N.A.
10. Tax on Profits
What are the federal or national tax rates on profits? N.A.
What are the regional or state taxes on profits? N.A.
What are the municipal or local tax rates on profits? N.A.
11. Tax Treaties
Are there any applicable tax treaties? Yes, treaties with the US and the UK
Are there any rules against treaty-shopping? No
12. Territoriality Rules
Where is the legal body subject to tax? Where the income is earned.
Is the legal body subject to tax on its worldwide income? No only on income earned in Belize.
13. Treatment of Tax Losses
How are tax losses treated? They can be carried forward.
14. Wealth Tax
Is there an applicable wealth tax? No
15. Withholding Tax
What are the rates of withholding tax on the legal body’s activities? None
XV GENERAL TAX CONSIDERATIONS
1. Immigration Controls
Are there immigration quotas? No
Are vaccinations required? No
Are medical certificates required? No
Are entry permits required? Yes, if you are not a resident of Mexico, U.S. or Commonwealth countries.
Are exit permits required? No
Are re-entry permits required? Yes
2. Immigration Requirements/Formalities
Is a residence permit required? No
If so, does the investor have to apply for one before entering the country? No, it can be gotten once in the country. What information must be supplied to the immigration authorities? Must present a valid passport and person must have resided in Belize for at least a year. Must provide proof of income, health certificates, and police record. How long does it take to receive authorization? Approximately 3 months
3. Visas
Is a visa valid for travel or stay in the country? Yes, if you aren’t Mexican, American or a Commonwealth resident.
If so, for how long is the visa valid? 1 visit-3 months
How does the investor apply for a visa? Belizean Embassy
What documents are required? Return ticket, money to sustain one’s self.
What fees are involved? $50.00
XVII. EXPATRIATE EMPLOYEES
1. Cost of Living and Immigration
How does the cost of living compare to that in the investor’s country? As with most developing countries, the cost of living in Belize is lower than in developed countries.
What is the rate of inflation? (See above Section II (A) (2)
2. Drivers’ Licenses
Must the investor obtain a driver’s license for that country? Yes, unless he is in possession of an International drivers license.
How does the investor obtain a driver’s license? Application to the Department of Transport.
What fees are involved? Learner’s permit- $20.00, 1st issue of license- $45.00
Is an examination, either practical or written, required? General Medical Exam as well as a written and practical exam.
3. Education
What types of schools are available for the investor’s family? Public government and church – operated schools as well as Private schools.
What fees are involved? These vary depending on level of education or whether the institution is public or private.
Can the investor or company receive a tax benefit? Limited deduction
4. Housing
What type of housing is available for the investor? Whatever type he can afford to pay for.
Can the investor own property? Yes
Must the investor have housing before he enters the country? No
Can the investor subsidize housing and receive a tax benefit? No
5. Importing Personal Possessions
Can the investor import his personal belongings? Yes
Are import duties Payable? Yes, duties will be lessened if he/she is Belizean resident.
Are there requirements for clearing the belongings through customs? Yes, retain a broker.
6. Medical Care
What level of medical care is available? Primary health care is available. Secondary-Limited.
Is there national health care? The National Health Insurance scheme has recently been implemented and is therefore in its trial stage.
7. Moving Costs
What costs are involved in moving? By ship- U.S. $1500.00 per container of goods from U.S. mainland.
Can the investor receive any tax allowances? No
8. Tax Liability
What is the expatriate’s tax liability? Same as any other Belizean
What are the allowances? Same as above
Are there any applicable tax treaties? UK and CARICOM
9. Work Contracts
Does the investor need a work contract to work in the country? Our law allows for formal and informal contacts.
If so, does the contract have to be for a certain duration, for the performance of a specific job or for a specific position? No
Does the contract have to be with a national or resident of the country or related state? No
10. Work Permits
Does the investor need a work permit to work in the country? Yes
How and where does the investor apply for the permit? Apply to Labor Department in locality for recommendation.
What documents are required? Person needs to fill out an application form and present his/her passport showing that he/she is legally present in the country. The applicant also needs to show that he/she is qualified for the type of work to be undertaken.
What fees are involved? Fees:
(1) Import /Export trader- $750.00
(2) Self employed Workers in agricultural Industries i.e. owners or managers of
farms- $1000.00
(3) Self employed Workers in Industries other than the aforementioned $1,200.00.
(4) Professional workers (holding degree)- $1,500.00
How long does it take to receive the permit? 3-4 weeks
For how long is the permit valid? 1 year
This article was provided compliments of :
Barrow & Williams
Attorneys-at-Law
99 Albert Street
P.O. Box 617
Belize City Belize
Central America
Tel: +501 227-5280
Fax: +501 227-5278
E-Mail: [email protected]
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