For many wealthy families and individuals, Trusts form an important part of the estate and wealth management planning process.
A Trust is one of the most flexible estate planning and investment vehicles available. Trusts permit complete flexibility in the management, control and ultimate distribution of assets, preservation and protection of wealth. Trust structures may also alleviate succession duties, wealth taxes, future hostile claims, forced heirship, exchange controls and probate fees.
DGM is leading provider of Trusts, Foundations and other fiduciary services.
DGM Trust Corporation is licensed in Barbados to provide a comprehensive range of trustee and corporate services to individual and corporate clients. The management of private wealth is the core of our business. We provide high quality bespoke services for the preservation, enhancement and ultimate disposition of wealth for present and future generations. Our trust clients include international high net-worth families who seek the benefits of employing professional trustees and directors combined with experienced, professional administration.
Our Trust Services include:
Acting as Trustee for domestic, international, purpose, reserved powers and unit trusts.
Acting as Special Director and administrator of Barbados private trust companies.
Acting as council members for Foundations.
Our Corporate and Management Services Include:
• Company registration, incorporation and licensing services.
• Registered office, Directors, Officers and Corporate Secretarial services.
• Holding of Board and Shareholder meetings and preparation of minutes and written resolutions.
• Company administration including invoice payments and preparation, and banking arrangements
• Annual licensing, tax returns and regulatory obligations.
• Preparation of financial statements and audit facilitation.
• Provision of corporate and Barbados residential Directors.
• Registration of External Companies.
• Registered Agent services.
• Share Transfer Agent.
• Company liquidations.
DGM collaborates with tax and legal advisors and other professionals to create the right structure for each individual’s circumstances. We do not give legal or tax advice but provide the support and infrastructure for service excellence: managing the day to day operational, administrative and regulatory requirements efficiently and effectively, thus allowing our clients the freedom they need to handle their business affairs effectively.
Incentives offered to International Business Companies (IBC’s) and Societies with Restricted Liability (SRL’s) in Barbados.
The incentives offered under the International Business Companies Act and the Society with Restricted Liability Act are as follows:
- Corporate tax on scale of 2.5% to 0.25%.
- Access to the Barbados tax treaty network in some cases.
- No capital gains tax and exemption from withholding tax.
- Freedom from exchange control.
- No minimum capital requirement.
- Duty-free imports of materials for business.
- Books and records may be kept in a foreign currency.
- Income tax concessions for specially qualified expatriate employees.
- Sale of foreign real estate or investments and the transfer of equity or quotas in an IBC are not subject to local transfer taxes or stamp duty.
Establishing an IBC or a SRL
To establish an IBC, a Company must first be incorporated under the Companies Act and then apply for and obtain a license from the Minister of Economic Affairs and Development. An SRL is incorporated under The Society with Restricted Liability Act.
The application must state the general nature of the international business the company proposes to conduct, including full details of shareholders and the directors and the name and address of its registered agent in Barbados. Under the Barbados Companies Act only a Secretary or Assistant Secretary need be appointed. Appointment of other Officers (President, Treasurer) is optional.
To ensure compliance with local law we recommend the appointment of DGM Trust Corporation as Secretary.
DGM Captive Management Services is licensed under the Exempt Insurance Act of Barbados offering complete management services to International Companies. Barbados is in the top 10 of the world’s captive domiciles and remains the largest domicile for captives owned by Canadian companies and associations and is a significant player in the US Market, Latin America and in particular Mexico.
A Company can be licensed under the Exempt Insurance Act or under the Insurance Act which also regulates domestic insurance companies. Insurance companies that decide to register under the Insurance Act are known as Qualifying Insurance Companies (QIC) and will be subject to tax while International Insurance Companies that are registered under the Exempt Insurance Act are known as Exempt Insurance Companies (EIC) which is not subject to tax.
Incentives for Establishing an EIC or QIC in Barbados
- Insurance companies can conduct insurance business either as an EIC or as a QIC
- Either entity could be established as a Segregated Cell Company (SCC)
- Both EIC and QICs are only required to have a minimum paid up capital of $US125,000
- Barbados regulatory framework is flexible as regards both reserve requirements and applicable accounting principles
- No indication of Barbados adopting the Solvency II Standard
- Tax Incentives: Barbados is a low tax jurisdiction with tax efficient structures and an expanding network of Double Taxation Agreements (DTAs) and Bilateral Investment Treaties. Under the Exempt Insurance Act, 0% rate of tax on taxable income for the first 15 years, thereafter, assessed at a rate of 8% on the first US$125,000 of taxable income, then 0% in respect of all other taxable income in excess of US$125,000
- Exemption from withholding taxes
- Exemption from exchange control
- No capital gains tax
- Barbados commits to use of IFRS or US GAAP
- Flexibility in Solvency Requirements: For companies carrying on general insurance business during the first year, the value of assets must exceed liabilities (solvency margin) by US$125,000. After the first year, the company must maintain a solvency margin such that it is at least equal to:
- if the premium income in the preceding year did not exceed US$ 750,000 then the solvency requirement is US$ 125,000.
- 20 % of premium income for the preceding financial year for the premium income up to US$5 million, plus
- 10 % of premium income for the preceding financial year for premium income in excess of US$5 million.
- Companies carrying on long-term insurance business are deemed insolvent and unable to pay its debts if the value of its assets does not exceed its liabilities.
- Competitive cost structure: The cost of doing business in Barbados is inexpensive compared to other domiciles
- International reputation: Barbados was the first international domicile to be placed on the OECD white list for international domiciles. It has a sophisticated infrastructure with a highly experienced and internationally trained workforce, political stability and a good economy, and has earned an excellent reputation for integrity as an international business centre.
- Robust Regulation and Governance – The Government of Barbados has continually reviewed and enacted legislation to enhance the attractiveness of Barbados as an international financial base for foreign owned companies, and it has become a premier captive domicile. Captive Insurance companies are subject to the regulatory authority of the Financial Services Commission, whose stated objective is to provide high quality and right-sized regulation
- Speed of Incorporation and licensing
- No restriction on insurance business written
- Good infrastructure for international insurance companies, including local availability of experienced management companies, banks, investment companies, auditors and lawyers
As of January 31, 2014, there were 179 active EICs and 45 active QICs in Barbados (Source: Financial Services Commission). Of the total number of active companies, approximately 54% originated from Canada and almost 30% were US-owned.
Our experienced professionals provide the following services to EIC and QIC at very competitive rates:
- Incorporation and licensing of Insurance Companies
- Ongoing management services to include mind and management, accounting, finance, underwriting and claims administration and ensuring compliance with regulatory requirements
- Corporate Secretarial, and administration services, including registered office
- Through our respected partners identify Investment managers, and arranging banking requirements.
DGM provides the expertise and management your Insurance Company needs to operate efficiently in Barbados.
DGM can assist high net worth international families seeking highly personalized and centralised handling of their financial and personal affairs. We ensure our families’ financial affairs are handled with the utmost levels of objectivity, integrity, professionalism and absolute discretion in a cost-effective and efficient manner. We bring focus and stability by consolidating their financial affairs, freeing family members from the time, effort and often conflict of managing their own wealth thus enabling them to enjoy their wealth. We provide families with a variety of advisory services in other areas such as changing regulation, succession planning, family governance planning, and charitable and philanthropic donations in a discrete manner. Through our concierge style service we can assist with, property management, monitoring personal investments and managing household bills through to assisting with day-to-day needs and travel arrangements.
DGM has successfully secured a growing number of Special Entry permits and work permits for clients wishing to relocate to Barbados to live, work or retire. We can assist with all stages of the application process.