The British Virgin Islands (“BVI”) Business Companies Act was amended on 1st January, 2023, with the main change being in Section 98. As a result, each company is required to prepare an Annual Financial Statement Form, which must be submitted to the BVI government.
This annual statement consists of a simple unaudited balance sheet, with companies required to report financial information as specified by the BVI government.
These documents are considered personal and confidential and will not be part of public records. Once completed, the statement should be held by the registered agent, who will provide a copy only upon request by the competent authorities.
However, the agent must report to the BVI company registry all companies that fail to submit the forms on time, and the agent may face penalties for non-compliance.
It is important to emphasize, that this requirement does not apply to certain entities, which is:
- Companies in voluntary liquidation (provided that the statement is due before the commencement of the liquidation),
- Companies that already submit Annual Returns to the BVI authorities
- Public companies whose shares are listed on a recognized stock exchange,
- Companies regulated by BVI financial services legislation
- Limited Liability Companies in the BVI.
The deadline for submitting statements for companies subject to this requirement is within nine months after the end of the company’s fiscal year. The initial standard deadline is 31st December, 2023, but companies may opt for a different fiscal year. Therefore, the first entities subject to this requirement must submit the statement by 30th September, 2024.
In addition, if a company does not complete the statement, it may face the following penalties:
- For the first month after the statement’s due date, a penalty of $300.
- For subsequent months, penalties may range from $200 to $5,000.
- If a company fails to submit the annual statement, it may be subject to compulsory strike-off by the company registry.
Therefore, BVI companies whose fiscal year coincides with 2023 or begins in 2023 are advised to prepare their Annual Statements upon the conclusion of their fiscal year and keep their accounting records in order. Further guidance on the Annual Statement may be issued by the BVI Financial Services Commission in due course.
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Published on May 20, 2023