icon fb blueicon linkedin blueicon call blueicon youtube blue

Incorporation procedures for businesses in the Cayman Islands

Trường Lăng
Trường Lăng, founder and 15-year director of Viettonkin, guides the company's strategic direction, makes top-level decisions, and represents the firm in key business negotiations. With over 20 years of consulting experience in Belgium and Southeast Asia, including 15 years specializing in FDI projects, he has established himself as a top expert who helps clients across industries expand their businesses. His deep knowledge of risk management and business operations, combined with his proven track record of successful consultation projects, makes him a valuable partner for investors seeking quality consulting services.

The Cayman Islands began developing into a major international financial centre in the 1960’s, and now has over 100,000 companies registered with the Registry of Companies. The Companies Registry has played an integral part in the development of the Cayman Islands as a highly ranked financial centre in the international business community. The growth continues at a steady pace with an average of 10,200 new companies registered each year over the past ten years. The registration and control of companies is governed by the Companies Law, the Limited Liability Companies Law and the Foundation Companies Law. Its administration is conducted by the Registrar of Companies and staff. The shareholders or members of companies may have limited or unlimited liability (1).

PRE-INCORPORATION 

1. Advisory stage: the requirements and features of the Client are discussed i) using an exempt business, a regular non-resident corporation, or another corporate structure ii) any possible license requirements, and iii) whether it would be wise to change the model articles of association;

2. Picking a name: Our Client selects three company names to submit applications for at the registrar of companies. Every limited liability company shall have a name which may, but need not, contain as a suffix the words “Limited Liability Company” or the abbreviation “L.L.C.” or “LLC”

3. Company constitution: The Cayman Islands Companies Law's model Memorandum of Association, Articles of Association are used by the majority of our clients.

4. Share distribution: Verify i) the shareholders' identity (s) ii) The share capital's currency; and iii) The quantity, distribution, and price of the shares that will be issued To reduce the number of government fees owed, we advise having a share capital of less than $50,000 USD;

5. Director choice: Appoint a director at a minimum. Companies based in the Cayman Islands may have corporate directors. To serve as a director of the corporation, each director must sign a paper;

6. Registered address: Our incorporation service plan permits the use of our Cayman Islands registered address;

7. Planning stage: The procedure is then broken down into week-by-week sections in a detailed engagement plan, including i) the incorporation and business registration process. ii) the need for supporting documentation; iii) tax ramifications, and iv) getting any required licenses. By doing this, transparency is maximized, client expectations are established, and the engagement is executed effectively.

INCORPORATION PROCEDURE

8. Document submission: We submit the applications for certificate of registration after all of the necessary paperwork is in place;

9. Incorporation approval: The incorporation of the business will take place in 4 days after the documents are submitted. Following approval, we provide the certificate of registration and other company documents to our client through email right away. The director's consent documents are now submitted to the client for their signature.

POST-REGISTRATION

10. Opening a corporate bank account: After receiving the company's corporate documents, we help our Client with this process. We can help clients open a corporate bank account for their Cayman Islands business either domestically or abroad;

11. Additional registrations: At this stage, we will apply for a Tax Exemption Certificate if our Client requests one. The TEC is given out by the Cayman Islands Cabinet Office in around 3 weeks. Now is the time to submit an application for any licenses or government registrations required for the company's selected business operations, such as those for excluded person status.

12. After the completion of the engagement, we courier to our client a complete company kit that includes the original corporate documents, unopened bank correspondence, and a client satisfaction survey.

Advantages of registering a business in the Cayman Islands

  • If organized appropriately, a Cayman Islands business can legally hold profits from abroad while paying the least amount of taxes abroad;
  • A Cayman Islands corporation has a legal corporate structure and is not required to audit or publish financial information on an annual basis;
  • A Cayman Islands business can be formed with just one shareholder and director. The shareholder and director may share the same legal entity, be a corporation, and be wholly owned by a foreign entity;
  • A 20-year government promise against the imposition of taxes can support the total absence of direct taxes. Our Clients must apply for a Tax Exemption Certificate in order to receive this guarantee. This entails a complete absence of all corporations, capital gains, payroll, property, and withholding taxes. There are no minimum capital requirements, however, Tax Exemption Certificates are only given to exempted corporations. An exempt Cayman Islands business does not need to maintain a record of members that is available for public inspection; Government registration costs rise in proportion to the amount of issued share capital; The entity can be managed from any location in the world after the exempt company establishment, and AGMs are not required. The same freedom is not available to regular non-resident firms;
  • Due to the effectiveness of the local tax and regulatory systems, the Cayman Islands are a well-known global hub for financial services. The value of the local currency is fixed to the US dollar, making it easily convertible. Cayman Islands dollars are equal to 1 US dollar. Since the Cayman Islands are a British Overseas Territory, local laws are based on English law, and the majority of business conducted via them is done in USD. Due to their familiarity with Commonwealth legal systems, clients find it simple to conduct business through the Cayman Islands;
  • To facilitate the incorporation of a firm, it is simple to open a global corporate bank account.
  • Foreigners with a net worth of US$7.3 million (KYD6 million) can now apply for a Residential Certificate for Investment after the Cayman Islands government enacted an amended bill. The holder of this certificate is granted permission to live in the Cayman Islands for a period of up to 25 years, but they are required to abide by a number of rules, including:
  1. Investing US$2.9 million (KYD2.4 million) in companies with a minimum of 50% Caymanians as employees;
  2. Passing frequent examinations to verify their enterprises' financial viability and their executive roles within those organizations;
  • The Cayman Islands has a supportive and favorable business climate for its investors due to its i) stable macro-economic and political environment contributing to low rates of inflation, ii) world-class infrastructural facilities and iii) excellent communications system along with a secure fiber-optic network; 
  • Once the incorporation forms are submitted, we will receive the corporate documents within a week.

Disadvantages of registering a business in the Cayman Islands 

Internationally, the Cayman Islands are viewed as an offshore tax haven. In order to combat tax evasion, the Cayman Islands were added to the European Union's (EU) blacklist of tax havens in February 2020 for failing to impose "economic substance" standards on local businesses;

  • A Cayman Islands-based client cannot do business with an exempt corporation there. Exempted businesses, however, are permitted to do worldwide commerce through a local operation;
  • Only through a regular non-resident corporation, not through an exemption company, may foreigners purchase Cayman property. This raises the administrative burden of owning property in the Cayman Islands;
  • The Cayman Islands have not signed numerous double taxation avoidance agreements because they do not have any internal taxes. As a result, holding corporations from the Cayman Islands are not always the most tax-efficient holding businesses;
  • The Cayman Islands are raising fees and taxes in response to pressure from the United Kingdom after obtaining assistance for its capital deficit and economic recession. It is anticipated that annual company fees (for both domestic and foreign businesses), general register costs, import tariffs, and work permit fees will increase;
  • The Organization for Economic Cooperation and Development (OECD) designated the Cayman Islands as a "cooperative jurisdiction" in the exchange of information on taxes in June 2000. 12 Tax Information Exchange Agreements (TIEAs) have been struck by the Cayman Islands with nations such as Denmark, Faroe Islands, Finland, France, Greenland, Iceland, Ireland, Netherlands, New Zealand, Norway, Sweden, and the United States;
  • When registered under the Banks and Trust Firms Law of 1995, banks and trust companies must pay annual fees;
  • It is crucial that our clients are aware of their yearly tax requirements, both personally and corporately.
  • The population of the Cayman Islands is only 62,585 people. The banking sector, as well as tourism, are important drivers of the economy. Therefore, it is very difficult for companies in other areas to have i) a large customer base and ii) hire skilled laborers in the Cayman Islands;
  • The Cayman Islands revised their FATCA and CRS regulations for businesses that trade and manage securities in November 2018. Such businesses will have to register with the Cayman Islands Tax Information Authority (TIA) in order to comply with FATCA or CRS requirements;
  • Additionally, new regulations from the Cayman Islands Monetary Authority (CIMA) mandate the adoption of AML and KYC policies by all businesses. instances of similar policies can be found here;
  • It took roughly 3 weeks for CIMA to complete the incorporation forms procedure and verify that all documents were certified.

Source : Healy

Unlock Vietnam's Market: Download Our Comprehensive FDI eBook Now!

Vietnam is emerging as a prime destination for foreign direct investment (FDI), driven by rapid economic growth, favorable government policies, and an investor-friendly business environment. This eBook provides a deep dive into Vietnam’s economic landscape, highlighting key industries such as manufacturing, real estate, and digital banking that attract FDI. It also explores the government’s proactive measures to streamline investment procedures, improve infrastructure, and offer tax incentives for foreign enterprises. Additionally, it covers crucial insights into market entry strategies, regulatory requirements, and socio-cultural factors that influence business success in Vietnam.


Download the eBook now to gain expert insights into successfully navigating Vietnam’s dynamic investment landscape!

Download EBOOK
Unlock Vietnam's Market: Download Our Comprehensive FDI eBook Now!

Vietnam is emerging as a prime destination for foreign direct investment (FDI), driven by rapid economic growth, favorable government policies, and an investor-friendly business environment. This eBook provides a deep dive into Vietnam’s economic landscape, highlighting key industries such as manufacturing, real estate, and digital banking that attract FDI. It also explores the government’s proactive measures to streamline investment procedures, improve infrastructure, and offer tax incentives for foreign enterprises. Additionally, it covers crucial insights into market entry strategies, regulatory requirements, and socio-cultural factors that influence business success in Vietnam.


Download the eBook now to gain expert insights into successfully navigating Vietnam’s dynamic investment landscape!

Download E-Book

About Us

Founded in 2009, Viettonkin Consulting is a multi-disciplinary group of consulting firms headquartered in Hanoi, Vietnam with offices in Ho Chi Minh City, Jakarta, Bangkok, Singapore, and Hong Kong and a strong presence through strategic alliances throughout Southeast Asia. Our firm’s guiding mission is aimed towards facilitating intra-ASEAN investments and connecting investors in Southeast Asia with the rest of the world, thus promoting international business relationships and strengthening inter-nation connections.
Contact
Email: 
info@viettonkin.com.vn
Phone Number: 
+84 977093166
Support
FAQ
Subscribe to our insights to look at the critical issue that your business is facing and stay ahead of the competition in a rapidly changing world.
Subscription Form
img linkedin
Viettonkin Consulting Logo © 2025 - Viettonkin JSC