Nominee Company Structure - Agency Agreement

The use of a UK company connected to Belize company for international trading.

It is possible to trade through a British company, which in turn is an agent for a Belize company.

The British company is a standard European private limited company; this company invoices your clients, This avoids having to invoice your clients through the the Seychelles company.

With this nominee structure:

• A large percentage of the net profit on trade, for example 90% of the total, is payable to with the Seychelles company
• A small percentage of net profit, such as 10%, is kept in the British company, and therefore corporation tax is paid in the UK. This tax could be as low as 2% of total turnover.
• This structure is allowed by both the UK and the Belize tax authorities, provided the beneficiaries are not resident in either country.

How the structure works

All sales invoices are issued by the UK company and all purchases are paid by the UK company. However they are trading as agents of your Belize company.

Belize Company - principal in the Agency Agreement

<-Agency Agreement->

UK Company - with an agency agreement with the Belize company

>-Invoices->

Clients

UK - Responsibilities

• All the advertising, marketing and promotion is undertaken by the UK company.
• The UK company invoices your clients and monies are received by the UK company.
• A percentage (say 90% or 95%) of all monies are collected by the UK company on behalf of the Belize company. The other monies (10% or 5%) is turnover in the UK company.
• Your clients only trade with the UK company, dealing with them, like they deal with any other UK or European supplier.
• Your clients are not aware of the agency agreement which exists between your UK company and the Belize company
• UK taxable profits are chargeable for Corporation Tax in the UK.

Sending profits to the Belize company

90% or 95% of total turnover, is collected by the UK company on behalf of the Belize company.

These monies should be sent to a Belize company account periodically, or to another account, administered on behalf of the Belize company.

We draft an Agency Agreement which is modeled on an agreement which has already been approved by UK tax authorities.

The Belize company cannot trade in Belize but the UK company can trade in the UK or any other country. Similarly, the UK can register for VAT, provided that it has clients or premises in the UK.

When is it useful to have this structure?

For trading: The UK- Belize structure is well suited for trading with invoicing being done by the UK company with title in the goods belonging to the Belize company.

Asset Holding: We can advise you to use this structure for holding property. The Belize company would own the assets and the UK company would act like a property letting agent. Rental income is invoiced by the UK company and received by it on behalf of Belize company, who is the landlord.

For one-off invoicing: The structure can be used in special cases, where normal trading is done through a Belize company but were a select number of clients will not accept invoices directly from a Belize company.

Details about the Structure

• Any assets should be in the ownership of the Belize company.
• If physical goods are sold, these are owned by the Belize company and sold on its behalf by the UK company. Title remains with the Belize company.
• The two companies need different directors and shareholders.
• Contracts with UK company should be signed outside the UK.
• The directors of the UK company must not be resident in the UK. We can provide suitable directors subject to certain safeguards.
• The directors of the Belize company should not be resident in Belize. We can provide suitable directors subject to certain safeguards.
• The Belize company must not trade in Belize.

Case Study One: for selective invoicing

Mr. Torrent is selling high tech equipment from Asia into North America.

Mr. Torrent is based in Europe but does his trading through a Belize company.

Some of Mr. Torrent's clients in North America tell him that they would rather not receive invoices from a Belize company, so Mr. Torrent uses a UK company to keep his clients satisfied.

What you require from us or services we can supply

• Incorporation and administration of a British company to act as agent
• Incorporation and administration of a Belize company to act as principal
• Preparation of a suitable agency agreement between the parties
• Registered offices for both companies
• Directors and secretary for both companies if required
• Nominee shareholders if required
• VAT registration for the British company if required
• Full invoicing and bookkeeping facilities if required
• Introduction to suitable auditors if required

Case Study Two: for a Trading Company

Mr. González in Spain is buying textile products from various international suppliers. He wishes to centralise his international purchases to take advantage of:

• economies of scale
• discounts available
• the tax benefits of an international company radiating from Belize
• confidentiality

However, if his Spanish company purchases these goods directly from a Belize company a tax investigation is likely to follow.

Mr. González therefore uses a UK company to sell the goods to his Spanish company.