St. Kitts and Nevis: Your Premier Tax Haven in 2023

It is widely known that banking secrecy and keeping beneficiary identities anonymous are no longer effective. This news is disappointing for many people who started offshore businesses because they used to enjoy full control over their assets without interference from tax authorities and regulators as well as no need to pay taxes on them.

Today, stricter regulations on tax havens are in place compared to 20 years ago when non-resident investors had easy access to these jurisdictions. However, legal ways to protect personal information and benefit from the absence of corporate taxes do exist. One option is to follow the tax laws of Nevis, an island known for its favorable tax regulations.

Now, the question is whether Nevis is still considered a tax haven and if foreign investors can legally take advantage of it in 2023. To answer this, we will examine the details of Nevis’ tax laws and explain how you can protect your money from high taxes and scrutiny by foreign organizations.

Nevis and St. Kitts: history, modern times, and the information you might need

Saint Kitts and Nevis are 2 small volcanic islands in the eastern Caribbean Sea. Combined, they have a population of about 45,000. Christopher Columbus discovered these islands in 1493, and the British settled there in the 17th century. The jurisdiction gained independence from Great Britain in 1983.

Nevis has a low crime rate and a pleasant climate, making it a great place for those who love warm weather and the sea. The islands’ beautiful beaches with white sand are a popular attraction for tourists.

If you plan to live in Saint Kitts and Nevis, be aware that you may feel isolated. Here’s why:

• On Nevis, few shops are available, so you may need to go to the neighboring island of Saint Martin for luxury items or famous brands.
• Both Saint Kitts and Nevis have high taxes on imported goods, which makes the cost of living here relatively high. If you decide to bring in a personal vehicle, you’ll have to pay about 50% in taxes.

Moving to Nevis definitely has some advantages. The transportation system between the islands of the Federation of Saint Kitts and Nevis is well-developed, including flights to the UK and the United States.

English is the main language spoken on the islands, which is helpful for immigrants.

Nevis was the first offshore jurisdiction to establish LLCs. This allows companies registered in Nevis to have control over their capital, earn profits locally or internationally, and be exempt from taxes on income generated in Nevis. They can also increase the protection already available by using trusts or funds.

Is Nevis indeed a tax haven?

In terms of taxation, Saint Kitts and Nevis is somewhat of a tax haven. This is especially important for offshore companies and trusts that are not residents of the islands. Nevis takes privacy protection extremely seriously, which is why many people choose it to keep their assets safe.

If you’re not sure whether an IBC or an LLC is the best option for you in Nevis, we suggest checking the linked International Wealth article for advice and suggestions.

Current tax structure in Nevis

In Saint Kitts and Nevis, both residents and non-residents don’t pay income or inheritance taxes. However, there exist specific tax rules for each group.

Here are the current tax rates for residents and non-residents in Nevis:

• The Value Added Tax (VAT) in Saint Kitts and Nevis is 17%. It’s already included in product prices. Hotels and restaurants have a lower VAT rate of 10%, while certain necessary items like flour, sugar, milk, rice, oats, bread, medical services, transportation, and insurance are not VAT-taxed.
• Non-residents of Saint Kitts and Nevis have to pay a fixed 15% withholding tax on their payments. NB: This rule doesn’t apply to offshore companies or local businesses that keep their accounts outside of Nevis and earn profits from foreign sources in overseas banks. Since money doesn’t enter Nevis or go through the accounts of residents, it’s not subject to withholding tax.
• Residents don’t pay withholding taxes but contribute 6% of their salary as social security payments. These rules also apply to foreign citizens who are not tax residents of Nevis.
• When properties are transferred, stamp duty is charged, ranging from 6% to 10%.
• Resident Nevis companies pay a corporate tax at the rate of 33%, but foreign offshore structures that earn profits from foreign sources are exempt from income tax.

Beware though that not everything is tax-free in this tax haven. Say, non-residents of Nevis pay a fixed 15% tax on dividends, royalties, and interest, while resident companies are exempt from it.

There’s a 4% tax on unincorporated businesses in Nevis, which applies to individuals or groups conducting business activities on the island without being registered under the local Companies Act.

In Saint Kitts and Nevis, there’s no capital gains tax, except when selling local assets and real estate that have been owned for less than 12 months.

BENEFIT FROM INTERNATIONAL WEALTH COMPANY AND TRUST INCORPORATION SERVICES IN NEVIS:

from 2950 USD

Register an LLC in Nevis

from 9399 USD

Tax-Exempt Trust on the Island of Nevis

from 5699 EUR

Your International Business Company Setup in Nevis with a Nevis Bank Account

Property tax in St. Kitts and Nevis

If you consider investing in real estate in Nevis and Saint Kitts, you should be aware of the tax rules currently in force:

• To buy property in Nevis, you’ll need a license that costs 10% of the property’s value. Yet, if you’re part of Nevis’ citizenship-by-investment program, you don’t have to pay the above fee.
• Afterward, the amount of property tax you’ll pay in Nevis depends on how you use the property and where it’s located. The said tax may range from 0% to 0.3%.
• When you sell property on the islands, you’ll pay a stamp duty of 6% to 10%.

The good news for investors is that there’s no capital gains tax on real estate sales in Nevis. Plus, property in Saint Kitts and Nevis is more affordable compared to other Caribbean islands, which is great for foreign investors and potential immigrants.

Trust tax in the islands of St. Kitts and Nevis

To protect your money and business in Nevis, which is an offshore location, consider creating a tax-free trust for maximum security. This method offers several advantages in keeping your assets safe from foreign creditors, relatives, tax obligations, and legal disputes:

• When you establish a Nevis trust, it is governed solely by the laws of the country where it is formed. This means that foreign creditors or claimants can only make claims to the trust’s assets through local legal procedures. To initiate a claim, a deposit of USD 100,000 is required. What is more, you will have to visit Nevis in person to make it possible.
• In Nevis, you’ll come across no mandatory rules for inheritance. This gives you the flexibility and control to decide how your assets will be distributed.
• Trusts created in Nevis are not subject to taxes, allowing you to optimize your financial arrangements.
• Irrevocable trusts have the advantage of no set expiration date. This allows for the seamless transfer of assets from one generation to the next with no need for wills or complicated court processes.

Why choose St. Kitts and Nevis as your tax haven: benefits to enjoy

Nevis is a great place for trusts, offshore companies, and even residents in search of tax advantages. These rules and regulations are legal and follow international standards from organizations like the OECD and FATF.

In Nevis, people don’t pay personal income tax, certain industries pay less VAT, and property taxes are low. Businesses that don’t make money on the islands have fewer obligations. They don’t have to report their finances, meet specific requirements, or pay corporate income tax.