Belize is no longer a tax-free jurisdiction as per the updated notice from the Belize Tax Service Department. The notice outlines the deadlines for filing tax returns and making tax payments for different types of international business companies (IBCs) in Belize.
Tax Returns
Grandfathered-In IBCs: Tax resident IBCs and members of a Public Investment Company (PIC) group who were previously exempt from income and business tax prior to July 1, 2021, must file their first annual tax return by March 31, 2022, accounting for tax due in the 2021 basis year.
Non-Exempt IBCs: The deadline for tax resident IBCs that were not exempt from income and business tax prior to July 1, 2021, has been extended. These IBCs must file their annual tax return by March 31, 2022, accounting for the 2020 and 2021 basis years. This includes IBCs that were incorporated on or before October 16, 2017, but acquired relevant activities or new assets after that date, as well as IBCs that were incorporated on or after October 17, 2017.
Exempt IBCs: Exempt IBCs must file their first information return (IR) by March 31, 2022. The IR must provide information regarding the tax residence of the IBC, listing all beneficial owners and direct and indirect legal owners and their residence as of December 31, 2021. After the initial filing, non-resident IBCs do not need to file an IR unless there is a change in status during a subsequent basis year.
Exempt IBCs are those that do not engage in relevant or regulated activities as defined by the Economic Substance (ES) Act, do not have a permanent establishment in Belize, and are tax resident in a country not on the European Union’s list of non-cooperative tax jurisdictions.
The annual tax return
The annual tax return must be accompanied by the payment of estimated tax due for a basis year. Even if the estimated tax due is nil, IBCs that benefit from a 0% business tax rate, such as Pure Equity Holding Companies and Holding Companies not engaged in an active trade or business or in relevant activities for the purposes of the Economic Substance Act, are still required to file an annual tax return.
Starting January 2022, tax resident IBCs must file the annual tax return online using the Department’s Integrated Revenue Information System portal IRIS Belize. Taxes can also be paid online using the secure payment platform of Belize Bank, Atlantic Bank Limited, or Heritage Bank Limited.
The IBC Annual Tax Return Form BTS 290 will be available in electronic format online through the IRIS Belize portal. IBCs or PIC companies should not file jointly until notified otherwise, as the corporate income tax for companies other than those engaged in petroleum operations was repealed by the Income and Business Tax (Amendment) Act, 2019. The IR Form will also be made available online.
IBCs with annual receipts of at least USD $6 million dollars or meeting the criteria listed in Section 32A(1)(c) of the Income and Business Tax Act Ch. 55 are required to submit audited financial statements in accordance with the International Financial Reporting Standards (IFRS). Other IBCs shall submit in-house audited financial statements at the time of filing the annual tax return.
Penalties for late filing
Penalties for late filing and payment of business tax include a ten percent (10%) penalty of the amount due or assessed for each month or part of a month in which the return was not delivered, continuing for a period of twenty-four months.
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