Bermudian companies an attractive offshore location for UK residends

The benefits of a bermudian company

Bermuda remains a British colony but operates in an independent way from the UK, it has its own parliament and way of life which combines a UK influence and feel with something of a tropical caribean charm.

A big attraction on the island is that there are no personal or corporate taxes, the costs of everything are very high though, and that extends to Accountancy and legal services.  Standards are good and there is good infrastructure available on the island, educational standards are very high.

A negative is that salaries are particularly high for example an experienced Accountant can expect to earn $250K per annum and an graduate administrator with good experience typically commands around $70K.

Thefore the attaction as an offshore base is of more benefit to a larger corporate with a significant tax bill.  Many companies setup holding company structures in Bermuda, particularly multi-nationals with operations and offices in multiple jurisdictions.

Many large corporates such as Google have a presence there and use approach called the Irish sandwich to transfer profits to Bermuda.  So fore example European profits will be earned in Ireland then via Dividends and management charges transfered to bermuda where they are rolled up or retained.

This approach is less viable for smaller entities due to the high costs of services such as Accountancy in Bermuda, company formation typically costs around $6,000 and keeping a registered office in bermuda typically costs the same per year.  Meaning that profits of greater than £100,000 per year are need to be able to cover the likely costs and be better off.  Also because of the UK controlled entity rules a company in Bermuda is subject to UK taxes if it us controlled from the UK even if it is based offshore.  So the controlling directors need to be non-resident, which again makes it unrealistic for smaller companies.

We’ve picked up a number of companies in the UK which appear to be Bermuda based here are a few examples:-

Exelvia Ltd

GRA (Bermuda) Ltd

Everest Re-insurance (Bermuda) ltd

A companies which appears to be aimed at servicing the Bermuda community:-

Bermuda Yacht and Sail Asset Management Ltd

I’ve spent many months in Bermuda and love the life and atmosphere there, sadly my time there was not a permanent arrangement!  There are many great attractions in Bermy as the locals call it and some of the best beaches in the World.

 

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