Aruba offers great support for offshore companies, although it is not tax-free. Aruba has its own labour and taxation system, a foreigner must apply for a residence or employment permit before entering.
Summary of business opportunities available in Aruba:
International Business Corporation (IBC)
| License fee (annual) |
US$500 |
| Formation/Incorporation fee |
US$750 |
| Annual Returns filing fee |
N/A |
| Minimum requirements and/or size |
N/A |
| Shareholders/Members |
One (minimum) |
| Directors/Managers |
One (minimum) |
| Bearer shares for overseas/local investors |
Allowed |
| Submission of annual returns and accounts |
Not required |
| Corporate Directors/Managers |
Permitted |
| Company Secretary |
Permitted but not required |
| Local Directors and meetings |
N/A |
Public Limited Company
| License fee (annual) |
US$1000-1500 |
| Formation/Incorporation fee |
US$500 |
| Annual Returns filing fee |
Required |
| Minimum requirements and/or size |
US$50,000 |
| Shareholders/Members |
One (minimum) |
| Directors/Managers |
One (minimum) |
| Bearer shares for overseas/local investors |
N/A |
| Submission of annual returns and accounts |
Required |
| Corporate Directors/Managers |
N/A |
| Company Secretary |
Required |
| Local Directors and meetings |
N/A |
Limited Liability Companies (LLC)
| License fee (annual) |
US$750 |
| Formation/Incorporation fee |
US$500 |
| Annual Returns filing fee |
N/A |
| Minimum requirements and/or size |
N/A |
| Shareholders/Members |
One (minimum) |
| Directors/Managers |
One (minimum) |
| Bearer shares for overseas/local investors |
N/A |
| Submission of annual returns and accounts |
Not required |
| Corporate Directors/Managers |
N/A |
| Company Secretary |
Not required |
| Local Directors and meetings |
N/A |
Limited Partnerships
| License fee (annual) |
US$250 |
| Formation/Incorporation fee |
US$250 |
| Annual Returns filing fee |
Not required |
| Minimum requirements and/or size |
N/A |
| Shareholders/Members |
One (minimum) |
| Directors/Managers |
One (minimum) |
| Bearer shares for overseas/local investors |
N/A |
| Submission of annual returns and accounts |
Not required |
| Corporate Directors/Managers |
N/A |
| Company Secretary |
Not required |
| Local Directors and meetings |
One local partner (minimum) |
| Currency |
Aruba Florin (AF) |
| Taxation |
|
| Income Tax |
|
Lower limit
0
10,001
15,001
25,001
45,001
65,001
100,001
150,001 |
Upper limit
10,000
15,000
25,000
45,000
65,000
100,000
150,000
200,000 |
Percentage
2.71
3.99
7.09
12.22
18.45
26.61
33.87
38.95 |
|
| Social Tax |
|
| Pension contribution |
Employer's contribution 9.2% of salary
Employee's contribution 3.88% of salary |
| Sickness Insurance |
8.3% for employers
2.1% for employees |
| Capital Gains Tax |
|
| Property Tax |
annual payment worth 0.4% of property value |
| Withholding Tax |
NONE |
| Inheritance Tax |
based on the value of the gift and the recipient |
Spouse or child
Sibling
Parent
Others |
2 6%
4 12%
3 9%
8 24% |
Business
Aruba is very rapidly converting into a major financial services centre with a promising growth and prospects for further investments. It also allows investment and financing companies to gain major tax benefits. This also applies to Offshore Banking, Royalty and Holding companies.
A new company concept has been put forward, the Exempt Company (AVV), which has been specifically designed for non-residents of Aruba. The company is completely exempted from taxation but has to make an annual registration payment of approximately US$280. The shareholding may be divided into Registered, Bearer and Preference shares. Each may or not have any voting powers but at least one voting share must be issued. The authorised share capital must be a minimum of AF 10,000, equivalent to US$5,600.
The AVV is not allowed to do business with any resident or onshore company; the disadvantage here is that the company cannot be a participant in Aruba's economy, yet represented permanently by at least one Aruban company or agent who is to act as the local registered agent. Considering the major drawback, there are advantages that alter the perception of instability. The AVV
-
Can be incorporated in 24 hours
-
Single shareholder/director is allowed
-
Filing returns and accounts annually is not required
-
Is not restricted by any rules of currency exchange in Aruba
- Company's annual general meetings may be held anywhere in the world provided it has been stated so in the Articles of Association
Permits
To start a business, a company must obtain a license and must be familiarised with the procedures, rules, and regulations of the government. The application will differ with the kind of business being intended to establish. Further, each managing director must obtain a director' s license, and each employee must seek a residence and work license. The application should contain basic information as is normally mentioned in a company's Memorandum of Association, such as:
-
The objectives of the company
-
The number of employees and the investment that is intended
-
The registered office of the company and the personal details of the founding directors and shareholders
The company must then await the issue of the business license before commencing any business activity.
Persons seeking employment or wish to conduct any form of business in Aruba must have a permit allowing them to do so. An employer must apply for the work permit, who will be fully responsible for the welfare and activities of the employee on the island.
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