Finding A New Legislation in Seychelles
The Seychelles undertook a review of all relevant preferential tax regimes, and as such, amendments were made to certain legislations.
Amendments to the International Business Companies 2016 (the Act), effective 1 January 2019, included removal of the ban on IBCs carrying on business in Seychelles. This is in line with the amendments made in the Business Tax Act to move Seychelles tax system to a territorial system, an IBC is now tax resident in Seychelles and no longer tax exempt. If an IBC carries on business in Seychelles it must pay Seychelles business tax, but an IBC is not liable for Seychelles tax on its foreign income or profits.
Seychelles general taxation system is based on the source principle (which Seychelles describes as a territorial system of taxation). Accordingly, income is taxable when activities are performed, goods and assets are situated, located or rights are exploited for economic purposes in Seychelles, irrespective of the nationality, domicile or residence of those involved or the place where contracts are concluded.
The process for obtaining a Seychelles TIN
The process for obtaining a Seychelles Taxation Identification Number (TIN) for a Seychelles company. Please note that this is not a mandatory requirement and clients have the option if it is required to apply for the TIN.
If a client IBC wishes to apply for a TIN and register in Seychelles as a taxpayer, you have to arrange for TIN Application Form to be completed and signed on behalf of the company and which authorizes Registered Agent to sign and lodge the application form with Seychelles Revenue Commission (SRC) on the company’s behalf.
IBCs that are applying for a TIN will need to keep their accounting records in Seychelles at the Registered Office address in Seychelles. This can be done in electronic format and the client obliges to send the accounting records of the Company to the registered agent each financial year.
What are the obligations of a registered business?
- Businesses must ensure they maintain all their records properly.
- Lodge their applicable returns on or before the due date.
- Pay their applicable taxes on or before the due date.
- Abide to all tax laws and regulations.
What are the current rates of Business Tax?
Business Tax:
0% on the first SR 150,000 of taxable income
15% on the next Rs 850,000
33% on the remainder
Companies do not have a tax free threshold. The rate payable is 25% on the first SR 1,000,000 and 33% on the remainder.
When is returns due date?
Business Tax Return: 31st March of the following year.
Majority of IBC’s operate outside of the Seychelles, the 2021 amendments means that the accounting records should be produced 2 times per year and held at the registered office address in the Seychelles. The accounting periods are to run from 1st January to 30 June and from 1st July to 31st December
IBC Tax advantages and benefits in Seychelles
– An IBC company registered in Seychelles is no longe offshore now.
– An IBC is free to maintain its business within Seychelles territories.
– As mentioned above, if an IBC only earns foreign (non-Seychelles) sourced income, it is not liable for Seychelles tax on any of its income or profits. For Seychelles IBCs that only earn foreign (non-Seychelles) sourced income, it is not mandatory for them to obtain a TIN and register with the SRC, though they may do so if they wish. Within 14 days after an IBC commencing business in Seychelles (earning Seychelles sourced income), it must register with the SRC and obtain a TIN.
– An IBC which does not earn Seychelles sourced income is not required to file a Seychelles tax return with the SRC. The International Business Companies Act 2016 (IBC Act) does not require IBCs, which only earn foreign sourced income, to file annual financial statements. If, however, an IBC earns assessable income (income sourced from Seychelles) it is required to notify the Registrar and to register with the SRC and to file an annual tax return and annual audited financial statements and to pay any Seychelles tax due on such income
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If you wish to register a company in Seychelles Republic our team will be happy to help you there and provide you with more detailed information, you can contact us at [email protected]
Related page: Seychelles Company Formation
