For a foreign owner in the Bahamas, an International Business Company (IBC) is usually registered under the International Business Companies Act (Chapter 309). The Bahamas is considered a classic offshore jurisdiction: corporate profit tax was introduced there for the first time only in 2024, and it applies only to large international groups. The trade-off is that an IBC is maintained by a licensed agent, beneficial ownership information goes into a secure system, and an economic substance report is filed every year.
The Bahamas at a glance
| Parameter | What applies |
|---|---|
| Company form | IBC under the International Business Companies Act (Ch. 309) |
| Who provides corporate services | licensees under the Financial and Corporate Service Providers Act, 2020, supervised by the Securities Commission of The Bahamas |
| Beneficial owners | the agent keeps a database under the Register of Beneficial Ownership Act, 2018, connected to the BOSS system |
| Economic substance | Commercial Entities (Substance Requirements) Act, 2023: report through the agent no later than 9 months after the end of the financial year |
| Profit tax | Domestic Minimum Top-Up Tax of 15% only for groups with revenue of €750 million or more |
| EU list of October 9, 2026 | the Bahamas is neither on the list of non-cooperative jurisdictions nor in Annex II |
Who registers and maintains an IBC
Under the Financial and Corporate Service Providers Act, 2020, registering and managing an IBC, providing registered agent and registered office services, and acting as its director or secretary are corporate services. Only a licensee supervised by the Securities Commission of The Bahamas may provide them by way of business. So, to register a company in the Bahamas, you first choose an agent: the agent checks the owners, files the documents, keeps the corporate records and submits the reports.
Under the Register of Beneficial Ownership Act, 2018 (section 9), every registered agent establishes and maintains a database of beneficial ownership information accessible to the Beneficial Ownership Secure Search System (BOSS). It is best to prepare the ownership chart down to individuals in advance: the agent will request it during the review stage.
Economic substance: who needs it
The substance requirements law (CESRA) applies to companies under the Companies Act, the International Business Companies Act and the partnership laws. According to the 2023 guidance of the Bahamas Ministry of Finance, the procedure is as follows:
- A company without a "relevant activity" only reports; it does not need to pass the substance test.
- The law lists as relevant activities banking, insurance, fund management, financing and leasing, headquarters, distribution and service centers, shipping, commercial use of intellectual property and holding activities (except investment funds).
- A company with such an activity must pass the test: direction and management in the Bahamas, adequate staff and expenditure, premises, and core income-generating activities carried out locally. A simplified version of the test applies to a holding company.
- An investment fund, a structure with Bahamian owners, or a legal entity that pays profit tax as a resident of another country only reports.
The report is submitted through the registered agent, who files it no later than 9 months after the end of the financial year. For more on the logic of these rules, see our article on economic substance.
Taxes: what the DMTT changed
During the debate, the Prime Minister of the Bahamas called the Domestic Minimum Top-Up Tax Act, 2024 the first corporate profit tax in the country's history. It applies only to multinational groups with annual revenue of €750 million or more and raises their effective rate in the Bahamas to 15%, starting with the financial period from January 1, 2024 (later for some groups). An IBC owned by a private individual or a small family group usually does not fall under this tax.
The owner's taxes are calculated separately. Their country of residence may tax the Bahamian company's profit under controlled foreign company rules or when dividends are paid, and if the company is actually managed from another country, it may become tax resident there. How to check this is covered in our article on CFC rules.
Who the Bahamas suits and what the alternatives are
The Bahamas is more often chosen for holding investments, family assets and shares, when the owner already has a bank or asset manager that works with Bahamian structures. For a holding company or joint ventures, people more often compare a BVI offshore company; for funds, the Cayman Islands (see the comparison Cayman Islands vs BVI). A business that sells services or goods to EU clients is usually better served by an operating jurisdiction with a clear tax regime.
The two-year budget consists of registry fees, agent and office services, the CESRA report, accounting records and banking costs. Agents' prices vary, so we put together a cost estimate for the specific structure.
A bank for a Bahamian company
A bank looks at the origin of the capital, the ownership structure and the assets the company holds. An investment structure needs documents on the portfolio and the asset manager; an operating company needs contracts, clients and the payment route. Registering an IBC does not guarantee an account, so we discuss the banking route before registration as part of our bank account for an offshore company service.
What to send for an estimate
Another island jurisdiction with an annual substance report is the Marshall Islands, and a budget IBC with a local agent is registered in Seychelles.
The owners' country of residence, the purpose of the structure (holding, investments, operating business), the assets and the banks you already work with. Based on this, Offshora will compare the Bahamas with the BVI and the Cayman Islands and prepare a cost estimate for registration and maintenance over two years. Submit a request.
Tell us about your task, and we will propose a jurisdiction, the scope of services and the order of work.
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