BARBADOS
1. Flexibility in solvency requirements: a. Deferred acquisition costs can be treated as assets, and
b. After the company’s first financial year, the required margin of solvency (the excess of assets over liabilities) depends on the level of the company’s premium income for the previous financial year;
2. Minimum capital requirement of US $125,000; 3. Speed of incorporation and licensing; 4. No restriction on insurance business written; 5. Special incentives, including:
a. Reduced corporate tax rate for exempt and qualifying insurance companies (EICs and QICs);
b. No capital gains tax;
c. Exemption from withholding tax on any dividends, interest, management fees or other income paid to non-residents;
d. Exemption from taxes on transfers of securities and assets to non-residents;
e. Exemption from exchange controls;
to its shores. There is no doubt that Barbados’ high international rankings also give investors comfort with the jurisdiction. These include third in the Caribbean and Latin America in the UN Human Development index; first in the Caribbean and Latin America, and second in the Americas, in Transparency International’s Corruption Perception index; third most competitive economy in the Caribbean and Latin America, and also third in soundness of banks in the same region, by the Global Competitiveness report; and the fourth most literate country in the world, to name but a few.
Barbados’ aim is to rise in the domicile ranking internationally, through our commitment to quality in all areas of international business: quality service providers, quality legislation and regulation, quality infrastructure and business facilitation. Although the country has long been regarded as a well regulated domicile for captive insurance business, the establishment of the Financial Services Commission in 2011 further enhances its regulation and supervision of the non-banking financial services sector. Consequently, Barbados’ position as an attractive world-class domicile for captive insurance has been further strengthened.
Additional advantages of setting up and operating an international insurance company in Barbados are:
f. Income tax concessions for specially qualified non-residents whose services are required for the effective management of a business;
6. Provision for incorporation of mutual insurance companies, that is, companies whose share capital is owned by their policy holders;
7. A generally accepted accounting principles (GAAP) system, which is less burdensome than the imposition of requirements to produce local statutory filings;
8. Freedom to acquire real estate; 9. Flexible work permit policy for expatriates;
10. Good support infrastructure for captives including a highly skilled labour force, experienced banks, investment companies, auditors and legal services which work to provide a low-cost operating environment;
11. No requirements for a captive to hold board meetings or have a local director in the jurisdiction;
12. Direct daily flights to Canada and the US; and
13. Double taxation agreements (DTAs) with other jurisdictions with which the US can do business through Barbados.
CICA | Forty years of captive leadership 103
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