As noted in our earlier article regarding the amendments to the British Virgin Islands (“BVI”) Business Companies Act (the “Act”) and the BVI Business Companies Regulations (the “Regulations”) that came into force on 1 January 2023, further specific information has been released relating to the annual return that must be filed by BVI companies. The BVI Business Companies (Financial Return) Order, 2023 which was enacted on 2 March 2023 provides further details on:
- The form of the return;
- The due and filing deadlines for the return;
- Entities exempted from filing an annual return
Format and filing of annual return
The BVI FSC confirmed the format of the annual return and it consists of a simple balance sheet and profit and loss statement. You don’t need to audit the financial statements, and you will file the information with the registered agent. It will remain private and confidential.
Due date and filing deadlines
Annual returns become due at the end of the company’s financial year. A company’s financial year is either the calendar year or the 12 month period which the company has expressly adopted. You must file the annual return with the registered agent within 9 months after the end of the company’s financial year.
For companies with a calendar year-end financial period, you must submit the first annual return by 30 September 2024, starting from 1 January 2024.
Exemption
The following companies do not need to file an annual return with their registered agent:
- a listed company refers to a company listed on a stock exchange;
- a company regulated under financial services legislation that provides financial statements to the Commission as per those requirements.
- a company that files its annual tax return to the BVI Inland Revenue Department accompanied by the company’s financial statements; and
- a company in liquidation, except that this exemption does not apply if the company’s annual return becomes due prior to the commencement of the liquidation (i.e. if a financial year has completed before liquidation commenced).
Other considerations and what to do next
All companies should adopt a financial year end if not already and should have available all the financial information for the 2023 financial period to prepare the financial statements.
Companies should align their economic substance financial periods with their year-end for consistency and efficient report filing. Many firms conclude their economic substance period in June, typically aligning with a December year-end by choice or default.
If you are unsure about the ongoing obligations for a BVI company, please contact us and we will assist further. Also, we can prepare financial statements for your BVI company and consequently provide a proposal upon request.