Accounting is mandatory for any offshore company, even if its financial statements are not open to the public. What differs is the scope of the requirements: in some jurisdictions it is enough to keep records and file an annual financial return with the registered agent, while in others an audit and a tax return are required. The owner also needs the company's financial statements if their country applies controlled foreign company rules.
British Virgin Islands
Under section 98 of the BVI Business Companies Act, a company must:
- keep records and underlying documents (contracts, invoices and similar documents on all sums received and spent) at the office of the registered agent or at another place decided by the directors;
- keep them in a way that explains all transactions and makes it possible, at any time, to determine the financial position with reasonable accuracy;
- retain them for at least 5 years from the date the transaction is completed or the business relationship ends;
- if the records are kept outside the agent's office, notify the agent in writing of the address and the name of the responsible person, and of any changes within 14 days.
In addition, under section 98A, companies that do not fall under the exemptions set by law file an Annual Financial Return with their registered agent. According to BVI FSC guidance, the deadline is nine months after the end of the financial year. This is a return to the agent, and it does not mean a mandatory public audit. For more on a BVI company's obligations, see the page BVI offshore company.
Hong Kong
In Hong Kong, an Annual Return (NAR1) is filed with the Companies Registry every year, as a rule within 42 days after the anniversary of incorporation; the fee for filing on time is 105 Hong Kong dollars. The profits tax return is filed with the IRD together with signed financial statements and an auditor's report, if an audit is required by law or has been carried out. Companies that have filed a special resolution on dormant status with the registry are exempt from preparing audited financial statements. The tax regime and annual obligations are described on the page Hong Kong offshore jurisdiction.
United Kingdom
A private company (Ltd) files:
| Obligation | Where | Deadline |
|---|---|---|
| First annual accounts | Companies House | 21 months from the date of incorporation |
| Subsequent annual accounts | Companies House | 9 months after the end of the financial year |
| Confirmation statement | Companies House | at least once every 12 months, within 14 days after the period; £50 online |
| Payment of Corporation Tax | HMRC | 9 months and 1 day after the end of the accounting period |
| Company Tax Return | HMRC | 12 months after the end of the accounting period |
An audit is not required for a small company that meets two of three conditions. For financial years beginning on or after April 6, 2025: turnover up to £15 million, assets up to £7.5 million, an average of up to 50 employees (previously £10.2 million and £5.1 million). An audit is still mandatory if the articles require it, if shareholders holding at least 10% have demanded it in writing no later than one month before the end of the year, and also for public companies, banks, electronic money issuers and a number of other categories. For registering a UK company, see the page offshore company in England.
Financial statements for the owner's country
If the owner is a tax resident of a country with CFC rules, they will need the company's financial statements. For example, a Russian controlling person substantiates a CFC's profit with financial statements prepared under the company's personal law and, where there is a mandatory or voluntary audit, also with the auditor's report, translated into Russian. For details, see our article on CFC rules and offshore companies.
What drives the cost of accounting
The price depends on the number of transactions and currencies, the number of banks and payment services, the reporting standard, whether an audit is mandatory, period-end closing deadlines and the quality of the underlying documents. A business with a few payments a month and a trading company with thousands of transactions require different amounts of work.
A business scenario
For six months, an operating company accepted payments through several payment services without consolidated bookkeeping. Before the annual return, the accountant has to reconstruct the path of every payment, exchange differences and fees from the statements. Monthly bank exports and a register of contracts from the first month cost less than such a reconstruction.
Common mistakes
- Ordering accounting services after the year has ended, when the underlying documents are already lost.
- Treating the annual return to the agent as a tax return.
- Missing the 14-day deadline for notifying the agent of a new address where records are kept.
- Mixing personal and corporate payments in one account.
How Offshora helps
Reporting and fee deadlines by jurisdiction are gathered into a calendar in annual offshore company maintenance, and the place of accounting in the overall budget is shown in how much an offshore company costs over 24 months. We take on bookkeeping and annual reporting under our offshore company formation and maintenance service.
Offshora arranges ongoing accounting and annual financial statements for a company in the chosen jurisdiction and helps prepare documents for the owner's tax authority. To get an estimate, submit a request and state the jurisdiction, the approximate number of transactions per month and the currencies.
Tell us about your task, and we will propose a jurisdiction, the scope of services and the order of work.
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