Last week we shared with you an option to move to Puerto Rico to reduce your tax bill to 4%. Some of you may have been intrigued, while many of you probably were not. There is actually another option for reducing your taxes by 90% on corporate or personal income taxes. This strategy also eliminates certain other taxes. All it requires is being a citizen of the U.S. Virgin Islands present in the islands for more than 183 days out of the year!
This is, of course, another strategy that requires some extra planning and consideration.
How Do I Start a Business in the US Virgin Islands?
If last weeks strategy of moving to Puerto Rico sounded too big for your liking, we get it. This strategy, like last week’s strategy, is a very unique one only useful if it fits your personal taste.
Here are some things you’ll need to get your business started in the US Virgin Islands:
- First, you’ll want to create a business plan. This will help you determine what your company does, what it sells and how much money it makes. It will also show you how much money you need to start your business and how much profit you expect to make in the first year.
- Register your trade name and/or corporation with the Office of the Lieutenant Governor. You can do this online or by mail.
- Select a good location and obtain a copy of an unsigned lease or letter of intent from the owner. You can then negotiate terms with both parties and sign the lease once everything is agreed upon.
- Obtain a business license from the V.I. Department of Licensing and Consumer Affairs (DLCA). This step involves applying for certain licenses based on what type of business you plan on opening.
Getting A Business License In USVI
When you want to start a business in the U.S. Virgin Islands, you’ll need a business license. If you’re starting your own business from scratch, you’ll be looking at several steps to obtain your license, but if you’re buying an existing business, it will be a lot more simple for you. The U.S. Virgin Islands Department of Commerce and Consumer Affairs (DCCA) handles all business licensing within the territory, and it’s a pretty straightforward process once everything is in order on your end.
Keep in mind, it may take 6 to 8 weeks to obtain your business license once all required documents and payments have been submitted.
Why The US Virgin Islands Is the Perfect Place To Live
The U.S. Virgin Islands is a great place to live for many reasons, but it’s also a great place to start a business. In fact, the territory has one of the most business-friendly environments in the Caribbean.
Here are some of the advantages of starting a business and living in the US Virgin Islands:
- Low cost of living — Compared to other parts of the United States and even other islands in the Caribbean, living costs are low, which makes it affordable to operate a business without breaking your budget.
- No income tax — There is no personal income tax on wages earned by individuals residing in USVI; therefore, employees do not have to pay federal or state taxes on their wages (the exception is Puerto Rico). This means that American citizens who work in USVI can keep more of their hard-earned money!
- Excellent infrastructure — USVI enjoys excellent transportation infrastructure including an international airport and ferry service between St Thomas and St John as well as taxis and public buses on each island.
Wasatch CPA Services LLC – Tax Planning Strategies
If you are interested in enjoying tropical weather close to some Atlantic beaches for several months a year, this may be the best strategy for you! While there are several strategies as unique as this one, there are several more highly applicable ones.
At Wasatch CPA Services LLC we have access to hundreds of federal and state strategies! Let’s get on a call to find some common and not-so-common strategies that are right for you.
We serve clients all over the United States, but we are proud to call Utah home. Give us a call at (801) 609-3119 and let us help you with tax planning for the future!