British Virgin Islands is most popular corporate destination in offshore world.
Substantial revenues are generated by the registration of offshore companies. As of 2004, over 550,000 companies were so registered. In 2000 KPMG reported in its survey of offshore jurisdictions for the United Kingdom government that over 41% of the world's offshore companies were formed in the British Virgin Islands. Since 2001, financial services in the British Virgin Islands have been regulated by the independent Financial Services Commission.
Figures released by the British Virgin Islands International Finance Centre have revealed that more than 65,000 Business Companies were registered in the British Virgin Islands in 2006, representing a 12% increase on 2005’s figure and establishing a new record for annual BVI company registrations.
The total number of BVI companies on its Register – both International Business Companies and BVI Business Companies – stood at nearly 775,000 as at December 31st 2006.
In addition, the British Virgin Islands continues to diversify its financial services offer. BVI has registered 57 new captive insurers last year, taking the total to over 400 captives and solidifying the position as the third largest offshore centre for captive insurance business. The territory also gained a further 282 investment businesses in the past year, with the total for that sector approximating 2,600 active mutual and hedge funds at the start of 2007.
As from 1st July, 2005, the BVI, like other British 'dependent territories', was forced to apply the EU's Savings Tax Directive, and chose to apply a withholding tax (initially of 15%) to the returns on savings paid to nationals of EU Member States. The Directive does not apply to corporate entities.