Bahamas or British Virgin Islands: where should your business be based?
The Bahamas ranks higher in the index, =15 against 25. Which suits you depends on where the owners live, what the company is for and how it will be run.
Pillar by pillar
Doing business, side by side
Tax
There is no corporate income tax. Groups with revenue of EUR 750 million or more pay a 15% Domestic Minimum Top-up Tax, and VAT is 10%.
Companies are generally exempt from income tax, and no withholding tax or VAT is charged. Individuals pay no income tax, although a payroll tax applies.
Set-up
The Registrar General's Department registers an IBC in 48 hours, or 1 hour by express service. The government fee is USD 350 for authorised capital up to USD 50,000 and USD 1,000 above.
Incorporation costs US$550 where up to 50,000 shares are authorised, and the annual fee is the same. No standard processing time is published.
On the ground
An IBC is formed through a licensed financial and corporate service provider, which acts as registered agent with a registered office in The Bahamas. Economic substance rules apply to relevant activities.
Every company must keep a licensed registered agent in the BVI at all times, and no director needs to live there. Substance depends on the activity.
Ownership
Registered agents file beneficial ownership details to a secure search system run by the Attorney General's Office. Only named authorities can search it.
Since 1 April 2026 the register is open only to persons with a legitimate interest, for anti-money laundering purposes, at a fee of US$75.
Residence
Economic permanent residence needs USD 1 million in real estate or Central Bank bonds, held for 10 years. Dependants can apply for an annual permit to reside, and home owners for a home owner resident permit.
The government lists a self-employed work permit for non-Belongers who work in the territory on their own account.
Living and working
Currency
The Bahamian dollar, pegged at par to the US dollar. US dollars are widely accepted.
US dollar.
Time zone
UTC-5, or UTC-4 in summer, the same as New York.
UTC-4.
Personal tax
There is no personal income tax, capital gains tax, inheritance tax or wealth tax. Employees pay 4.65% national insurance up to a wage ceiling of BSD 3,510 a month.
There is no income, capital gains, inheritance or wealth tax; employees can pay 8% payroll tax, and a property tax exists.
Flights
Lynden Pindling International Airport in Nassau has about 57 scheduled nonstop destinations, including seasonal routes, with direct flights to London Heathrow, Toronto and most large cities on the US east coast.
The Beef Island airport lists nonstop flights to San Juan, but no direct London, New York, Dubai or Singapore service.
Bahamas vs British Virgin Islands: common questions
The Bahamas: There is no corporate income tax. Groups with revenue of EUR 750 million or more pay a 15% Domestic Minimum Top-up Tax, and VAT is 10%. The British Virgin Islands: Companies are generally exempt from income tax, and no withholding tax or VAT is charged. Individuals pay no income tax, although a payroll tax applies.
The Bahamas: The Registrar General's Department registers an IBC in 48 hours, or 1 hour by express service. The government fee is USD 350 for authorised capital up to USD 50,000 and USD 1,000 above. The British Virgin Islands: Incorporation costs US$550 where up to 50,000 shares are authorised, and the annual fee is the same. No standard processing time is published.
The Bahamas: An IBC is formed through a licensed financial and corporate service provider, which acts as registered agent with a registered office in The Bahamas. Economic substance rules apply to relevant activities. The British Virgin Islands: Every company must keep a licensed registered agent in the BVI at all times, and no director needs to live there. Substance depends on the activity.
The Bahamas: Registered agents file beneficial ownership details to a secure search system run by the Attorney General's Office. Only named authorities can search it. The British Virgin Islands: Since 1 April 2026 the register is open only to persons with a legitimate interest, for anti-money laundering purposes, at a fee of US$75.
The Bahamas: Economic permanent residence needs USD 1 million in real estate or Central Bank bonds, held for 10 years. Dependants can apply for an annual permit to reside, and home owners for a home owner resident permit. The British Virgin Islands: The government lists a self-employed work permit for non-Belongers who work in the territory on their own account.
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