Seychelles Double Taxation Agreement with Cyprus

Posted in Double Taxation Agreements at 12:52 pm by Robert Klien

An initial agreement on starting the negotiations about double tax was signed by the principal secretary of the Seychelles Department of Finance and by the Commissioner and Director of the Cypriot Inland Revenue.

In January, 2006, a delegation from Cyprus came to the Seychelles for the negotiations leading to a Double Taxation Avoidance Agreement between the Seychelles and Cyprus. The two governments have agreed to a new bilateral pact aiming at the prevention of the double taxation of income as well as boosting investment flows between the Seychelles and Cyprus. New investments are likely to originate initially from Cyprus, however it is quite possible that also investors in the Seychelles could capitalise on the agreement.

The agreement was signed on June 28, 2006 by the Seychelles’ Minister for Economic Planning and Employment and the Cypriot Minister for Finance.

Cyprus appeared to be also enthusiastic towards starting negotiations on a Bilateral Investment Promotion and Protection Agreement.


Double taxation benefits of Seychelles CSL companies

Posted in Double Taxation Agreements, Seychelles CSL, Seychelles offshore jurisdiction at 7:50 am by Robert Klien

Creating a CSL in the Seychelles gives the possibility to benefit of low taxation and to profit Special Licence CSL of no double taxation treaties.

The Seychelles has several double taxation treaties signed with:

  • South Africa;
  • Malaisia;
  • Thailand;
  • China;
  • Mauritius;
  • Oman;
  • Botswana;
  • Zimbabwe;
  • Indonesia;
  • Belgium;
  • Namibia

As a result of some negotiations, Russia, United Arab Emirates, Egypt and Vietnam are waiting to sign treaties as well.


Seychelles IBC and CLS taxation comparison

Posted in Seychelles CSL, Seychelles IBC at 7:16 am by Robert Klien

The CSL is resident in the Seychelles for tax purposes. The IBC is a non-resident for tax purposes.

Seychelles IBC is prohibited to carry on business in the Seychelles. As to the CSL, it may carry on legal business both inside and outside the Seychelles. It may have an office in the Seychelles to direct its operations from and to manage and control company. In such a case, it receives duty exemption on the furniture and office equipment imported for the office and gets social security concessions for its employees.


Government Fees payable by Seychelles CSL Company

Posted in Seychelles CSL at 2:45 am by Robert Klien

Schedule 3 of the Act provides fees payable by Seychelles CSL Company.

  • application for incorporation: US$ 200.00
  • annual license fee: US$ 1000.00
  • annual return filing fee: US$ 200.00

It is notable that annual license fee for CSL company is considerably higher than for IBC with Authorised Capital up to US$ 100,000, however it is the same as for IBC with Authorised Capital over US$100,000.

The fees paid to Corporate Service Providers for incorporation services, assistance with the Special License application processing and management services for offshore company in the Seychelles should be added there. These fees varies from Corporate Service Provider to Corporate Service Provider and should be discussed prior creating the company.


Taxation of Seychelles CSL company

Posted in Seychelles CSL at 3:45 pm by Robert Klien

Schedule 2 of the Act provides tax rates for Seychelles CSL Company.

The rate of the tax payable by a company in respect of its taxable income is 1.5%.

The rates of withholding tax are the following:

  • dividend paid to a resident – nil;
  • dividend paid to a non-resident – nil;
  • interest paid to a resident – nil;
  • interest paid to a non-resident – nil;
  • royalty paid to a non-resident for the right to use a copyright, patent, trademark, design, model, plan – nil;
  • royalty paid to a non-resident for supply of scientific, technical, industrial or commercial knowledge, services, information – nil;
  • royalty paid to a non-resident for the right to use a secret formula, process ot know-how whether technical, managerial or otherwise, other intellectual property or right – nil;
  • royalty paid to a non-resident for the right to use an industrial, commercial or scientific equipment – nil.

So, under the Business Tax Act, the CSL is liable to Seychelles corporation tax at the rate of 1.5% on its income. No withholding tax must be paid on dividends, interest or royalties. This is different from the common approach of taxing only Seychelles-sourced income.


CSL company registration

Posted in Seychelles CSL at 9:05 am by Robert Klien

Seychelles CSL is registered in the Registrar of Companies that issues the certificate. Seychelles International Business Authority (SIBA) issues the special licence upon having the confirmation of registration.

At least two individuals (to be directors), and a resident secretary (to accept service on behalf of the company) are needed for a CSL. There are no provisions for corporate directors. Meetings by shareholders and directors may be held by phone or any electronic means if they hear and recognise each other. All resolutions may happen in writing, cable, telex or e-mail. Annual returns have to be submitted to the Authority.

CSL creation is not a formal process. A detailed Application for the SIBA – and the substantial amount of information from the client and/or beneficial owner of the company – are needed for it.

A Seychelles incorporated International Business Company (IBC) or a company incorporated outside the Seychelles may become a CSL. For this, it has to submit to the Authority articles of continuation (in English or French), and certified by the Secretary which must contain the name of the company and the name which is to be used, the jurisdiction of incorporation, the date of incorporation, the amendments to memorandum and articles, or their equivalent, that are to be effective upon the registration of the articles of continuation.

Also, continuation outside the Seychelles is allowed, subject to any limitations in the memorandum and articles of association.


Seychelles CSL purposes

Posted in Seychelles CSL at 4:32 pm by Robert Klien

The below-mentioned list from Schedule 1 of the Act is a list of purposes for which a licence may be issued, although the other purposes also can be considered. However, the company’s business activities are to be specific and limited to the approved purposes. These could be:

1) Investment management and advice
2) Offshore banking
3) Offshore insurance
4) Reinsurance
5) Business of:

  • an investment company
  • a holding company
  • a marketing company
  • a company holding intellectual property
  • a headquarters company
  • a human resources company
  • a franchise company

6) Business under a ITZ licence
7) Any other business approved by the authority