BarbadosCompany formation, tax and banking

Why people choose Barbados

• Tax treaties with Canada, the UK, the US (limited) and Mexico
• A real 9% company tax, which is what makes the treaties usable
• Treaties can cut the tax other countries keep back on payments to you
• One of the world's largest captive insurance sectors
• No capital gains tax and no inheritance tax

Where Barbados fits

• Treaty-based holding
• Captive insurance
• Canadian outbound

Where Barbados fits in a structure

Typical role · Treaty-based holding company

A Barbados company sits above the businesses you own, often for Canadian investment abroad, and pays a real 9% tax on most company income. That rate is the point, because it lets the company use Barbados's tax treaties, which can cut the tax other countries keep back on payments to it. It's also home to captive insurers (a company's own in-house insurer) genuinely managed in the Caribbean.

What it depends onTo rely on the treaties you need directors who live in Barbados, board meetings and real decisions there, and a genuine business reason, because Canada's tax office and others check this actively.

A simplified picture to explain the idea, not a recommendation. General information, not tax or legal advice.

Opening a bank account

CIBC FirstCaribbean, Republic Bank, Scotiabank and RBC Royal Bank operate locally, alongside international banks licensed under the Financial Institutions Act. Opening a business account takes four to eight weeks and they expect a director who lives in Barbados and evidence the company is run there.

How tax works here

9% company tax on income up to BBD 1m, falling to 5.5% at higher levels for some companies, plus a 15% top-up for large groups under the global minimum. Foreign currency permits give discounts. No capital gains tax, no inheritance tax, and in most cases no tax kept back on payments to residents of treaty countries.

Real presence, and who can see the owners

Substance laws apply to certain activities: the company must be run from Barbados, with enough staff and spending there. In practice, to use the treaties you need directors who live there, board meetings held there and real decisions made there — Canada's tax office and others check this actively. The real owners are reported privately.

When to choose it

Choose Barbados when using tax treaties is the point of the structure, especially for Canadian investment abroad, or for a captive insurer genuinely managed in the Caribbean.

You get a written comparison, not a sales pitch.

Every Barbados recommendation comes as a written comparison with the alternatives — whether the setup will stand up to scrutiny, how easy banking will be, which tax treaties apply, who can see the owners, what it costs to run each year and the risk to your reputation — so you can see the trade-offs before you commit.