Bahamas or Cayman Islands: where should your business be based?
The Bahamas ranks higher in the index, =15 against 24. 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 pay no corporate income, capital gains or withholding tax, and no VAT is charged. Individuals pay no income or inheritance tax.
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.
Registration costs CI$700 to CI$2,568 by capital band. An express service completes within 24 hours for CI$500 more, and no minimum capital applies.
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.
Directors need not live in the islands, but the company must keep a registered office there. Economic substance requirements depend 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 28 February 2025 the beneficial ownership register is open only to persons with a legitimate interest, including journalists, at CI$75 an application.
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 Certificate of Direct Investment requires at least CI$1,000,000 invested in a licensed business that generates employment.
Living and working
Currency
The Bahamian dollar, pegged at par to the US dollar. US dollars are widely accepted.
Cayman Islands dollar.
Time zone
UTC-5, or UTC-4 in summer, the same as New York.
UTC-5.
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, inheritance, capital gains, gift or property tax, but most real estate sales carry 7.5% stamp duty.
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.
Services include British Airways to London via Nassau and Delta and JetBlue to New York; there is no Dubai or Singapore service.
Bahamas vs Cayman 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 Cayman Islands: Companies pay no corporate income, capital gains or withholding tax, and no VAT is charged. Individuals pay no income or inheritance tax.
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 Cayman Islands: Registration costs CI$700 to CI$2,568 by capital band. An express service completes within 24 hours for CI$500 more, and no minimum capital applies.
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 Cayman Islands: Directors need not live in the islands, but the company must keep a registered office there. Economic substance requirements depend 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 Cayman Islands: Since 28 February 2025 the beneficial ownership register is open only to persons with a legitimate interest, including journalists, at CI$75 an application.
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 Cayman Islands: The Certificate of Direct Investment requires at least CI$1,000,000 invested in a licensed business that generates employment.
Read more
Still weighing Bahamas against Cayman Islands?
A short call settles what a ranking cannot: your residence, your structure and your timeline.