KEY POINTS
Prior Year declarations are being reviewed by the ITA. The ITA is requesting that a reason be provided for failure to file a declaration within the relevant ES financial period.
Failure to file an economic substance declaration constitutes a breach of statutory obligations and has legal and operational consequences.
Penalties: Failure to File/Submit Returns may an initial penalty of roughly $3,000 to $5,000, with daily accruing fines for ongoing non-compliance.
The process for the imposition of a penalty includes an initial warning; a representation period of 21 days by the entity, a final penalty notice and an Appeal within 30 days of the final notice to the BVI high Court.
The BVI International Tax Authority (ITA) has recently migrated its reporting platform from the BOSS system to the VIRRGIN platform. While the underlying laws remain the same, this migration introduces new information requirements and changes how data must be submitted.
To ensure your entity remains compliant and to avoid potential penalties, please review the important updates and guidance below.
ADDITIONAL INFORMATION REQUIREMENTS
With the move to the VIRRGIN platform, the ITA now requires more detail for certain filings.
-Entities NOT conducting a Relevant ActivityIf your company does not conduct a “Relevant Activity” under ES laws, the new system now requires a brief description of the company’s business activities. A company can no longer simply state that it does not have a Relevant Activity.
-Beneficial Ownership (BO) Data
While BO information is pre-populated in the system based on previous filings, additional information such as the tax identification number and tax residence must be populated in the new system.
Specific Guidance for Holding Businesses
The majority of BVI entities fall under the “Pure Equity Holding Entity” category. The new platform has specific validation rules for these entities:
-Holding Business: The ITA’s view is that when an entity is considering whether or not it is a Pure Equity Holding entity (“PEHE”), it should consider the rights attached to the equity participations, that is whether the shares held or other forms of investment give the holder the right to participate in the profits of the legal entity. If the entity simply holds equity participation but there is no right to participate in the profits (i.e. the dividends) then the Company will not be a PEHE.
-Type of Income: The income type must now be stated can only be dividends, capital gains, or both.
-Employees (Equity participation not actively managed): If your Holding Business is not actively managed, there should be no employees recorded. A director is not an employee.
-BVI Expenditure (Equity participation not actively managed): Do not enter “0” for BVI expenditure. Even holding companies that are not actively managed incur costs. Annual government fees, Registered Agent (Portcullis) fees, and statutory filing fees are legitimate BVI expenses and should be reported.
-Actively Managed Entities: If you declare that your Holding Business is actively managed, the ITA now requires details of the operations ie. the jurisdiction where business is located together with details of the employees and premises supporting the operations.
Compliance Reminders
As we enter the new filing period, please keep the following statutory obligations in mind:
Mandatory Filing: ES reporting is a statutory obligation for all BVI companies and limited partnerships.
Penalties: Failure to file an ES declaration will result in fines and penalties. This applies to current ES declarations as well as any outstanding filings for previous years.
Deadlines: While the platform is changing, the statutory deadlines remain the same. The deadline for filing your ES report in the British Virgin Islands is strictly 6 months after the end of the ES Financial Period.
Company Status
ES Financial Period (Default)
Reporting Deadline
Incorporated BEFORE 1 Jan 2019
30 June – 29 June (of the following year)
29 December (of that year)
Incorporated ON/AFTER 1 Jan 2019
12 months starting from your Date of Incorporation
6 months after your specific anniversary
Annual Review: Business operations can evolve. We strongly recommend reviewing your company’s activities at least annually to ensure your classification remains accurate.
Administrative Penalties
The ITA has the power to issue penalties for “administrative non-compliance.” While specific amounts can vary based on the severity of the breach, the general categories include:
Failure to File/Submit Returns may result in an initial penalty of roughly $3,000 to $5,000, with daily accruing fines for ongoing non-compliance.
Providing False or Misleading Information: If an entity provides inaccurate data to the ITA, administrative fines can reach up to $40,000, depending on whether the act was negligent or intentional.
Failure to Comply with a Notice: If the ITA issues a notice to produce documents or information and the entity fails to comply, the penalty is usually around $3,000 for the first instance.
The Penalty Process
The administrative process follows a specific legal sequence to ensure fairness:
Warning/Warning Notice: The ITA will issue a notice stating the nature of the breach and the intended penalty.
Representation Period: The entity typically has 21 to 30 days to provide a written explanation or “show cause” as to why the penalty should not be imposed.
Final Penalty Notice: If the ITA is not satisfied with the explanation, it issues a final notice demanding payment.
Appeals: Under the ITA Act, you have the right to appeal an administrative penalty to the High Court if you believe the decision was legally flawed or the amount was disproportionate.
Action Required: Completing Your Economic Substance Annual Return (ESAR) Form
To navigate these new system requirements efficiently, we request that you fully complete the Portcullis Economic Substance Assessment Review (ESAR) form when provided. Incomplete forms will not only result in back-and-forth communication, potential delays in filing and additional compliance fees, but expose your entity to the late penalties mentioned above.
Attention should be paid to all fields including Currency/Business activity/Gross income/ Immediate and Ultimate Parent fields/Tax jurisdiction/TINS
Please contact your Portcullis Relationship Manager or one of our representatives for assistance or further information should you have any questions relating to these amendments.
重點摘要
ITA目前正審查過往年度之經濟實質申報。
ITA要求未能於相關經濟實質財務期間內完成申報之公司說明其逾期/未申報之理由。
未提交經濟實質申報聲明即係違反法定義務，並可能產生法律及營運層面之影響。
未提交或未依規定申報經濟實質可能導致之初始罰鍰約為USD 3,000至5,000，並可能因持續不符法遵要求而按日累計罰鍰。
行政處分流程：初步警告通知、公司享有為期21日之陳述期間、最終處分通知，以及自最終通知日起30日內向英屬維京群島高等法院提起上訴。
KEY POINTS
Prior Year declarations are being reviewed by the ITA. The ITA is requesting that a reason be provided for failure to file a declaration within the relevant ES financial period.
Failure to file an economic substance declaration constitutes a breach of statutory obligations and has legal and operational consequences.
Penalties: Failure to File/Submit Returns may an initial penalty of roughly $3,000 to $5,000, with daily accruing fines for ongoing non-compliance.
The process for the imposition of a penalty includes an initial warning; a representation period of 21 days by the entity, a final penalty notice and an Appeal within 30 days of the final notice to the BVI high Court.
The BVI International Tax Authority (ITA) has recently migrated its reporting platform from the BOSS system to the VIRRGIN platform. While the underlying laws remain the same, this migration introduces new information requirements and changes how data must be submitted.
To ensure your entity remains compliant and to avoid potential penalties, please review the important updates and guidance below.
ADDITIONAL INFORMATION REQUIREMENTS
With the move to the VIRRGIN platform, the ITA now requires more detail for certain filings.
-Entities NOT conducting a Relevant ActivityIf your company does not conduct a “Relevant Activity” under ES laws, the new system now requires a brief description of the company’s business activities. A company can no longer simply state that it does not have a Relevant Activity.
-Beneficial Ownership (BO) Data
While BO information is pre-populated in the system based on previous filings, additional information such as the tax identification number and tax residence must be populated in the new system.
Specific Guidance for Holding Businesses
The majority of BVI entities fall under the “Pure Equity Holding Entity” category. The new platform has specific validation rules for these entities:
-Holding Business: The ITA’s view is that when an entity is considering whether or not it is a Pure Equity Holding entity (“PEHE”), it should consider the rights attached to the equity participations, that is whether the shares held or other forms of investment give the holder the right to participate in the profits of the legal entity. If the entity simply holds equity participation but there is no right to participate in the profits (i.e. the dividends) then the Company will not be a PEHE.
-Type of Income: The income type must now be stated can only be dividends, capital gains, or both.
-Employees (Equity participation not actively managed): If your Holding Business is not actively managed, there should be no employees recorded. A director is not an employee.
-BVI Expenditure (Equity participation not actively managed): Do not enter “0” for BVI expenditure. Even holding companies that are not actively managed incur costs. Annual government fees, Registered Agent (Portcullis) fees, and statutory filing fees are legitimate BVI expenses and should be reported.
-Actively Managed Entities: If you declare that your Holding Business is actively managed, the ITA now requires details of the operations ie. the jurisdiction where business is located together with details of the employees and premises supporting the operations.
Compliance Reminders
As we enter the new filing period, please keep the following statutory obligations in mind:
Mandatory Filing: ES reporting is a statutory obligation for all BVI companies and limited partnerships.
Penalties: Failure to file an ES declaration will result in fines and penalties. This applies to current ES declarations as well as any outstanding filings for previous years.
Deadlines: While the platform is changing, the statutory deadlines remain the same. The deadline for filing your ES report in the British Virgin Islands is strictly 6 months after the end of the ES Financial Period.
| Company Status | ES Financial Period (Default) | Reporting Deadline |
|---|---|---|
| Incorporated BEFORE 1 Jan 2019 | 30 June – 29 June (of the following year) | 29 December (of that year) |
| Incorporated ON/AFTER 1 Jan 2019 | 12 months starting from your Date of Incorporation | 6 months after your specific anniversary |
Annual Review: Business operations can evolve. We strongly recommend reviewing your company’s activities at least annually to ensure your classification remains accurate.
Administrative Penalties
The ITA has the power to issue penalties for “administrative non-compliance.” While specific amounts can vary based on the severity of the breach, the general categories include:
Failure to File/Submit Returns may result in an initial penalty of roughly $3,000 to $5,000, with daily accruing fines for ongoing non-compliance.
Providing False or Misleading Information: If an entity provides inaccurate data to the ITA, administrative fines can reach up to $40,000, depending on whether the act was negligent or intentional.
Failure to Comply with a Notice: If the ITA issues a notice to produce documents or information and the entity fails to comply, the penalty is usually around $3,000 for the first instance.
The Penalty Process
The administrative process follows a specific legal sequence to ensure fairness:
Warning/Warning Notice: The ITA will issue a notice stating the nature of the breach and the intended penalty.
Representation Period: The entity typically has 21 to 30 days to provide a written explanation or “show cause” as to why the penalty should not be imposed.
Final Penalty Notice: If the ITA is not satisfied with the explanation, it issues a final notice demanding payment.
Appeals: Under the ITA Act, you have the right to appeal an administrative penalty to the High Court if you believe the decision was legally flawed or the amount was disproportionate.
Action Required: Completing Your Economic Substance Annual Return (ESAR) Form
To navigate these new system requirements efficiently, we request that you fully complete the Portcullis Economic Substance Assessment Review (ESAR) form when provided. Incomplete forms will not only result in back-and-forth communication, potential delays in filing and additional compliance fees, but expose your entity to the late penalties mentioned above.
Attention should be paid to all fields including Currency/Business activity/Gross income/ Immediate and Ultimate Parent fields/Tax jurisdiction/TINS
Please contact your Portcullis Relationship Manager or one of our representatives for assistance or further information should you have any questions relating to these amendments.
重點摘要
ITA目前正審查過往年度之經濟實質申報。
ITA要求未能於相關經濟實質財務期間內完成申報之公司說明其逾期/未申報之理由。
未提交經濟實質申報聲明即係違反法定義務，並可能產生法律及營運層面之影響。
未提交或未依規定申報經濟實質可能導致之初始罰鍰約為USD 3,000至5,000，並可能因持續不符法遵要求而按日累計罰鍰。
行政處分流程：初步警告通知、公司享有為期21日之陳述期間、最終處分通知，以及自最終通知日起30日內向英屬維京群島高等法院提起上訴。
英屬維京群島國際稅務局 (ITA) 近期已將申報系統由 BOSS 平台轉換至 VIRRGIN 平台。雖然相關法規並未變更，惟本次系統轉換新增部分資訊填報要求，並調整資料提交方式。
為確保 貴客戶之公司持續符合相關法遵要求並避免潛在罰鍰及處分，敬請參閱以下重要更新及作業指引。
新增資訊填報要求
於VIRRGIN 平台進行申報時，ITA新增部分資訊填報要求：
-未從事相關活動之實體
如 貴客戶未從事經濟實質法規所定之「相關活動 (Relevant Activity)」，新系統將要求填報公司業務活動之簡要說明，不得僅聲明未從事相關活動。
-實質受益權 (BO)資料
系統將依既有申報資料自動帶入實質受益權資料 (BO)，惟仍須於新系統中補充填報稅籍編號 (TIN)及稅務居住地等資料。
持股型公司之具體指引
多數BVI公司屬於「純股權持有實體 (Pure Equity Holding Entity, PEHE)」。新平台針對該類型設有以下規定：
-持股性質之認定：ITA認為，公司於判斷是否屬於純股權持有實體 (PEHE) 時，應考量股權附帶之權利，即所持股份或其他投資是否賦予持有者得參與分配該法律實體利潤之權利。如僅持有股權但不得參與利潤分配 (即股利)，則該公司不應認定為PEHE。
-收入類型：收入類型須明確填報，且僅得為股利、資本利得或兩者皆有。
-員工 (未積極管理之持股公司)：如持股公司未進行積極管理，則不應填報任何員工資料。公司之董事非屬員工。
-BVI境內支出 (未積極管理之持股公司)：請勿填報「0」。未進行積極管理之持股公司仍會產生相關支出，包括政府年費、註冊代理人 (即保得利) 服務費及法定申報費用等，均屬合理之BVI支出並應如實申報。
-積極管理之實體：如申報為積極管理之持股公司，ITA現要求提供營運相關資訊，包括實際營運所在地，以及支持該營運之員工及營業場所之詳細資料。
法遵提醒
敬請於新一輪申報期間注意以下法定義務：
強制申報：經濟實質申報為所有BVI公司及有限合夥之法定義務。
罰鍰及處分：未提交經濟實質申報聲明將導致罰鍰及相關處分，且該規定同時適用於當年度申報及過往年度未完成之申報。
申報期限：新上線之申報平台不影響既定之法定期限。英屬維京群島經濟實質申報之期限為：
| 公司成立時點 | ES 財務年度 (預設) | 申報期限 |
|---|---|---|
| 2019/01/01 前成立 | 每年 6 月 30 日至次年 6 月 29 日 | 該年度 12 月 29 日 |
| 2019/01/01 以後成立 | 自成立日起 12 個月 | 成立周年日後 6 個月內 |
年度檢視
公司營運情況可能隨時間變動。建議 貴客戶至少每年檢視一次業務活動，以確保上述分類正確。
行政處分
ITA得就「行政不符法遵要求」之情形進行行政處分，相關處分內容包括：
未提交或未依規定申報：初始罰鍰約為USD 3,000至5,000，並可能按日累計罰鍰。
提供不實或誤導資訊：依情節輕重，罰鍰最高可達USD 40,000。
未遵循ITA函文通知之要求：首次違規罰鍰約為USD 3,000。
行政處分流程
上述行政處分之先後順序：
警告／警告通知：ITA將發函通知說明違規性質及擬處罰內容。
陳述期間：公司通常有21日至30日提出書面說明。
最終處分通知：如說明未被接受，將發出最終通知並要求繳納罰鍰。
上訴：公司得向英屬維京群島高等法院提起上訴。
後續應行措施： 完成經濟實質年度申報 (ESAR)
為因應新系統之填報要求，當 貴客戶收到保得利提供之經濟實質評估審查表 (ESAR)時，敬請完整填報所有欄位。
未完整填報將導致往返補件、延誤申報時程及產生額外費用，並將導致公司面臨前述逾期罰鍰之風險。
填報時請特別留意以下欄位：幣別/ 業務活動/ 總收入/ 直接及最終母公司/ 稅務管轄地/ 稅籍編號 (TIN)
如對上述新增規定有任何疑問或需要協助，敬請聯繫您的保得利關係經理。
