CORPORATE TRANSACTIONS & COMPLIANCE BLOG

Doing Business in the U.S. Virgin Islands (USVI)

By: Karen Redman, COGENCY GLOBAL on Fri, Dec 20, 2019

Doing Business in the U.S. Virgin Islands

Every year around this time, when the wind chill starts sending temperatures into (what feels like) negative number territory, I dream of living in a Caribbean Island… a dream punctuated by a casual dress code and dazzling blue seas. Not a winter scarf in sight.

If I were to make this dream come true now, meaning open an office on a Caribbean island, perhaps I would choose the U.S. Virgin Islands (USVI).

Doing Business in the USVI

As an unincorporated U.S. territory, the tax system would be quite familiar but USVI economic development programs also provide tax exemption incentives for gross receipts tax, excise tax, property tax and customs duties, along with a possible 90% income tax exemption.

Note that these benefits given to companies in the U.S. Virgin Islands are legally sanctioned by the U.S. government, so it’s not considered a corporate or offshore tax haven.

Requirements for a USVI Business License

Once an American entity secures a USVI Certificate of Qualification, it must apply for a business license before engaging in business operations. Standard business licenses are applied for and acquired from the Department of Licensing and Consumer Affairs

To get your USVI business license, you will need the following:

  1. A completed business license application. If your trading address in the USVI is being provided by your corporate registered agent, then your application will need to be accompanied by an original Letter of Authorization for use of the registered agent’s address.
  2. A copy of the Certificate of Qualification from the Office of the Lieutenant Governor, evidencing the registration and existence of the company in the USVI, together with a copy of consent from your registered agent (to act in that capacity) and the usual supporting documents, such as a company’s articles and bylaws or an LLC’s operating agreement.
  3. A Tax Clearance Letter from the USVI Bureau of Internal Revenue. (The USVI Bureau of Internal Revenue will need a copy of the document issued by the U.S. IRS assigning the company’s EIN.) 
  4. Police records for the officers of the corporation (who are listed on the license application) from the USVI Records Bureau.
  5. Copies of valid government-issued identification (driver’s license or passport) for the officers, as listed on the license application. If the company is an LLC and there is only one member, manager or officer, we will need to provide a copy of the ID for the sole individual.
  6. Clearance Certificate from the Department of Planning and Natural Resources (zoning approval).
  7. Copy of the Certificate of Inspection from the Fire Department. 

*Previously, the Fire Department would accept the Certificate of Inspection that was in the name of the entity’s registered agent, if the entity didn’t have a physical address. However, it is now required that the clearance application be in the entity’s name, accompanied by an original Letter of Authorization for use of the registered agent’s address. 

In addition, the following listed professions must be certified by their respective board to practice in the USVI:

  • Architects, Engineers and Land Surveyors
  • Barbers, Beauticians, and Manicurists
  • Construction Contractors
  • Electricians
  • Plumbers
  • Public Accountants
  • Real Estate Appraisers
  • Real Estate Commissioners
  • Social Workers

These profession-based exams are administered by the pertinent professional board at the Department of Licensing and Consumer Affairs.

Be aware that some businesses will also need to submit to a review by the Department of Health depending on the type of license requested (food-related businesses, counseling practices, massage therapists, etc.)

Don’t Expect Fast Turnaround Time

Starting your business in the U.S. Virgin Islands will take some time. Once all required documents and payments have been submitted, it may take 6 to 8 weeks (with no guarantees) to obtain the business license. There is an expedited service for a fee of $100, however, our experience has shown that the expedited option is not any faster. Would you expect anything less when you live on island time?

Oh, how I look forward to never again skating down my icy driveway and, instead, feeling that warm island sun on my face in winter as I head to work!

This content is provided for informational purposes only and should not be considered, or relied upon, as legal advice. 

Topics: International Corporate Services