Cayman Islands vs. Barbados: Offshore Business
Showdown
With their stunning landscapes and favorable business climates,
the Caribbean islands of the Cayman Islands and Barbados are vying
for the attention of entrepreneurs globally. We delve into the
specifics to assess which destination might be the ideal fit for
establishing an offshore business.
Chart: Comparing Business Essentials
* Barbados Corporate Affairs
** Invest Barbados
*** FlightsFrom.com
**** CIA World Factbook – Barbados
***** Numbeo – Cost of Living
Comparison
Taxation
The Cayman Islands offers a tax-neutral haven with no
corporate, capital gains, or sales taxes, making it an appealing
destination for fiscal efficiency. Conversely, Barbados attracts
businesses with its low corporate tax rates ranging from 1% to 5.5%
and absence of capital gains tax, bolstered by a network of double
taxation agreements.
Special Considerations
- Double Tax Treaties: Barbados has a
comprehensive network, beneficial for entities in countries like
Canada. The Cayman Islands, with a Tax Information Exchange
Agreement (TIEA) with Canada, offers a 0% tax rate on
repatriating funds, providing a potentially more favorable fiscal
position.
| Tax Type | Cayman Islands (CEC) | Barbados |
| Corporate Tax | 0% | 1% – 5.5% |
| Personal Income Tax | 0% | Up to 33.5% |
| Capital Gains Tax | 0% | 0% |
| Sales Tax/VAT | 0% | 17.5% |
| Withholding Tax | 0% | 0% on dividends |
| Double Taxation Treaties | None | Extensive Network |
| Special Tax Incentives | Yes (SEZs) | Yes (IBC regime) |
Setting Up a Business
Barbados boasts a swift online incorporation process, capable of
setting up a business in about 5 days. The Cayman Islands provide a
detailed, guided setup process taking 4-6
weeks.
Intellectual Property and Legal Framework
Both jurisdictions uphold British Common Law, ensuring robust
protection for your business’s intellectual property. They both
permit 100% foreign ownership, with Cayman Islands’ law adding
familiarity for those used to British legal systems.
Ease of Doing Business and Travel
The Cayman Islands are noted for their streamlined business setup and
connectivity to major American cities. Barbados facilitates
efficient business operations and offers extensive global
connectivity through its well-equipped infrastructure.
Island Demographics and Business Community
Dynamics
Barbados is a bustling hub with over 303,431 residents,
supported by an investment-friendly government. The Cayman Islands,
though smaller with 65,483 inhabitants, feature a global mix of
over 130 nationalities. This diversity enriches a vibrant business
community, making it particularly attractive for international
networking and enterprises.
Special Economic Zones and Investment
Incentives
The Cayman Islands stand out with Special Economic Zones (SEZs),
offering significant tax relief and operational benefits. Barbados
lacks SEZs, but does offer robust incentives for global businesses,
underpinned by supportive government policies. Both locales are
primed for global entrepreneurs seeking advantageous business
environments.
Lifestyle
In the Cayman Islands, residents enjoy a luxurious lifestyle, complete with top-tier
amenities, healthcare, education, restaurants, and leisure
activities like beach outings and water sports. Barbados offers a
blend of sophistication and local culture, rich in cultural
activities, diverse cuisine, and excellent education and health
facilities.
Safety
The Cayman Islands are celebrated for their safety and low crime
rates, bolstered by proactive anti-corruption measures. Barbados
maintains a generally safe environment, with crime mostly limited
to minor incidents. Its governance, while stable, is perceived as
somewhat lax in addressing corruption, though it doesn’t
overshadow the island’s overall security.
Cost of Living
Both destinations face high living costs. The Cayman Islands
offset these costs with no direct taxes, such as income or sales
taxes. Barbados, featuring a lower cost of living index, offers an
attractive tax regime with numerous incentives. These financial
strategies make each island appealing, depending on individual and
business financial goals.
The choice between the Cayman Islands and Barbados for setting up
an offshore business hinges on specific priorities. Barbados
appeals to those looking for a rapid setup and lower initial costs,
while the Cayman Islands attract those desiring an efficient and
luxurious business environment, complemented by a diverse
international community. Each offers unique tax advantages, with
the Cayman Islands further distinguishing itself with Special Economic Zones, which enhance
both business prospects and quality of life.
Ready to Set Sail?
Discover the unique benefits of Cayman Enterprise
City. With world-class facilities and a
dynamic business community, the Cayman Islands not only promise
significant business growth but also an unparalleled quality of
life. Join us and elevate your business
within our Special Economic Zones.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.