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On January 1, 2023, it became mandatory for British Virgin Islands Business Companies (BVIBC’s) to file an Annual Return.
The enabling legislation was the BVI Business Companies (Amendment) Act, 2023 (The BC Act) and it was further codified in the BVI Business Companies Financial Return Order
The BVI Annual Return is a report comprising a simple Income Statement and Balance Sheet. It provides a snapshot of a company’s financial position, detailing revenues, expenses, gains, losses, assets, liabilities, and shareholders’ equity for a specific period. The return does not need to be audited. Please review the sample Annual Return included at the end of this circular.
From the effective date of January 1, 2024, BVIBC’s with a financial year end of December 31, 2023, were required to submit their first Annual Return by September 30, 2024.
The general rule is that the deadline date for filing the Annual Return is nine months from the BVIBC’s chosen year end. So as an example, if the year-end is March 31, 2024, the deadline date is December 31, 2024 and for a year-end of July 31, 2024 the deadline date is April 30, 2025.
Through our sister company Crowe (BVI) Limited which provides Audit and Accountancy Services, we can provide valuable assistance in the preparation of annual returns, maintenance of your Accounting Records, and Financial Statement preparation. Crowe provides efficient and cost effective services to ensure compliance with BVI Annual Return requirements. For further information please contact us using the information in the contact details section below.
Once completed, the Annual Return must be filed with the Registered Agent of the company. There is no requirement for the Registered Agent to further file the return with the Registrar of Companies. However, after a grace period of one month the Registered Agent has a statutory obligation to inform the Registrar of non-compliant companies that have not submitted a return.
The default is the December 31, calendar year end, For any other chosen year end the Board of Directors should pass a resolution stating the financial year end and provide such resolution to the Registered Agent.
Financial penalties are imposed on a
BVIBC for failing to file the annual return
as follows:
a) for the first month or part thereof after
the filing of the annual return was due, the
penalty shall be US$300; and
b) for each subsequent month or part
thereof after the first month the penalty
shall be US$200, up to a maximum of
US$5,000 after which the BVIBC may be
struck off the Register.
Annual returns are private and confidential and remain with the Registered Agent. They do not enter the public domain. However, there are legislative provisions under which competent authorities, such as the BVI Financial Services Commission, the International Tax Authority or the Attorney General may request a copy and the Registered Agent is obliged to accede to valid and proper requests when made.
There are a few exemptions from filing an Annual Return that are allowed under section 98A(5) of the Act which include:
a BVIBC listed on a stock exchange a BVIBC regulated by the BVI Financial Services Commission and such as is mandated to submit annual Financial Statement to the commission. a BVIBC that files its annual tax return including financial statements with the BVI Inland Revenue Department. a BVIBC in liquidation. It should be noted however, that this does not apply where the annual return became due before liquidation commenced.
Note also that the Annual Return requirement applies to BVIBC’s only. In other words,it does not apply to Limited Partnerships and other entity types in the BVI.
BVIBC’s are allowed to use any currency for the Annual Return. The template below displays US$ but this is not mandatory
There are no prescribed Accounting Standards that need to be followed for preparing the Annual Return, but International Financial Reporting Standards are commonly used and accepted.
There is no requirement whatsoever that the Annual Return be audited.
The Annual Return is a new but very important obligation for a BVIBC and preparation for it should not be taken lightly. It requires a company to properly record its transactions and maintain proper files so the relevant information can be retrieved, analyzed and processed to generate the required Annual Return.
If you are unable to carry out the above mentioned functions or if you prefer not to spend your valuable time on such mundane tasks we can provide assistance to enable you to fulfill your obligations and ensure full compliance with this new mandatory requirement in the British Virgin Islands.
Name of Company: | |
---|---|
Financial Year Ending: |
ASSETS | US$ |
---|---|
Cash and Cash Equivalents Investments and Other Financial Assets Tangible Fixed Assets Intangible Assets Other Assets |
|
TOTAL ASSETS | $- |
Accounts Payable Long-Term Debts Other Liabilities TOTAL LIABILITIES |
|
---|---|
TOTAL SHAREHOLDERS EQUITY | $ – $ – $ – |
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY |
Name of Company: | |
---|---|
Financial Year Ending: |
US$ | |
---|---|
Revenue
Cost of Sales |
|
GROSS PROFIT | $ – |
Operating Expenses Other Expenses Income Tax Expense |
|
---|---|
TOTAL EXPENSES | $ – |
NET INCOME | $ – |
---|
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