IBC and LLC: Differences and Similarities
February 11, 2016
Both big commercial companies’ and small business’ owners tend to incorporate a companies in Belize. As Belize is one of the places with the lowest cost of living, operating here can be extremely affordable, which at the same time allows saving much money on an everyday basis. Moreover, it is located close to the United States, so you can reach Belize by plane in few hours. Numerous tax benefits and confidentiality guarantee that provide safety of the business establishment and running are important reasons for Belize’s popularity. In case you have plans for leading your own business in Belize, find out more about LLC and IBC in order to choose the best classification for your business.
What is IBC?
BC had gained its popularity in Belize after the country accepted the International Business Companies Act (IBCA), in 1990. IBC, or international business company, is great way of leading business. At the same time IBC is imposed with no corporation or local taxes.
IBC provides numerous businesses with its main advantages: there is no need in filing annual returns and in financial reports or list of employers and employees’ publicly disclosure; there is an ability to hold your corporate records anywhere you think it is necessary.
IBC is an international business company, but conducting business within Belize is not allowable if you want to avoid taxes. At the same time, only a certain minimum capital sum must be held within a Belize financial institution.
What is LLC?
The main feature of limited liability corporation, LLC, is an ownership by a partnership which consists of two persons or just a single person. Moreover, by establishing LLC the separation of your business resources and personal assets is also meant.
It is very convenient that individual taxes are separated from business taxes, therefore, any bankruptcies that may affect the LLC, will not affect your personal assets. Both small businesses and anyone who desires to integrate their IRA and organize their personal retirement holdings chose an LLC.
The process of LLC company formation in Belize is clear and aboveboard. Mostly in a month, after all papers are submitted, a legal LLC starts to operate.
Similarities between the LLC and IBC
There are few likenesses between the LLC and IBC. Firstly, both companies are recognized within Belize. In addition, both of them provide the international business owners with total privacy, obscurity and financial security.
Another similarity consists in the fact that both companies are not established to make money from locals. In case you want to manage business within Belize, a local onshore company is the best choice for you.
Differences between the LLC and IBC
There are few key reasons that put strong differences between the LLC and IBC. In short, LLC is always a much smaller company, because it has one or maximum two owners.
An IBC can be managed by a large board of directors or a big team of international investors. Moreover, it is quite more difficult to obtain an IBC. Therefore, in order to make it official you will need few months and a possibility to hold some additional meetings.
The IBC’s biggest benefit over an LLC is the ability of earnings’ retaining. All of LLC’s profits and expenses must be settled within a particular calendar year, while IBC can comply into the future regular income produced from outside of the United States.
By setting up a company in Belize, you can achieve a list of advantages. Moreover, you have all the chances to establish LLC or IBC to get access to Central America’s market.