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The best country for an internet entrepreneur to incorporate

This article was written on May 17, 2012 – we have recently published (December 2018) the ‘Where to set up an International Business‘ article series, where you can find up to date information on international structuring options:

Where to set up an International Business

If you have an online business, you might find yourself asking the question: I’m an internet entrepreneur, where should I incorporate my online business? Offshore incorporation can offer significant advantages to incorporating ‘onshore’ in a high tax location. Furthermore, especially if you are location independent, you have the ability to pick the best strategic jurisdiction from which to run your business.

Some reasons for incorporating include:

  • Protection of Assets – Your assets are better protected when held in a legal entity.
  • Privacy – You can receive additional layers of privacy
  • Taxes
  • Different accounting practices
  • Compliance with local laws
  • Ease of worldwide banking and wire transfers
  • Corporate Banking – Banks give you more respect as a corporation

It should be pretty obvious that there are major advantages when you operate a business from behind a corporate veil. You should also consider where you host your website, and consider asset protection for the internet entrepreneur. Where is the best place for an internet entrepreneur to form a company? That’s best answered by establishing guidelines for what makes a good jurisdiction, or good legal entity.

What makes for a good legal entity to set up an internet company?

A legal entity is a corporate vehicle which contains your business. It is the LLC, the C-Corp, the LTD or Pte Ltd, etc that holds your business assets. You want to find a place (hint there are 3 of the best listed below) that has most, or all of the following:

  • Simple Filing
  • Quick <48 hour filing
  • Privacy
  • Ability to bank worldwide
  • No tax at corporate level on worldwide income
  • strong asset protection and no lawsuits
  • Company meetings can be held anywhere
  • Common law
  • English Speaking country
  • No capitalization requirements
  • Only 1 member required
  • No local directors required
  • No secretary required
  • No audits
  • No publicly accessible accounts
  • Good Jurisdictional reputation

For the most part, any such locations which tick the box for the aforementioned bullet points would be a good place to set up.

Where you do NOT want to set up your company

Most onshore, high tax locations are not a strategic choice for an incorporation set up that minimizes taxes and liability. What’s onshore? Australia, Canada, UK, the US, places with lawsuits, high taxes, red tape.

If we are looking for a strategic jurisdiction to set up our corporate flag, we want to pick the very best location worldwide. What makes a place good for incorporation setups?

A place that wouldn’t make any sense whatsoever might be Indonesia. In this country, there is a large capitalization requirement, meaning that a deposit needs to be made into a local bank account in the country. Furthermore, as is the case for many SE Asian countries, there is a mandatory requirement of at least 50% local ownership, either legitimate or at the very least nominee or proxy. This means that a local citizen is required to have legal control of your company; whether they have actual control is up to you. Obviously, it makes little sense to start a company in Indonesia or another such jurisdiction, except for the reason of tax residency, which is a topic for another discussion.

Although you may get tax residency, it makes very little sense to otherwise incorporate in a place like Indonesia. To anyone with even a small amount of experience with the offshore world, this is a blatant reality. An onshore jurisdiction that taxes the profits of the worldwide income isn’t necessarily a good choice, particularly if you don’t like handing over your money to bureaucrats who will gladly take it.

You want to incorporate somewhere that is ‘offshore’. Meaning that the profits can accumulate in a jurisdiction which doesn’t tax companies on their worldwide income. Indonesia is an extreme example.

A less extreme example of somewhere you would not want to incorporate as an internet entrepreneur is Madeira


the best country to incorporateLet’s examine Madeira, which is a bit closer to the type of place we are looking for: low taxes, no local shareholders required, etc. We are getting warmer, but we are not quite there yet.

The offshore jurisdiction of Madeira, located off the coast of Portugal – is getting closer to what we are looking for, but is still not ideal. I want to quickly highlight this jurisdiction as another example of what NOT to do, so you know why the corporations I list below are ideal.

The entire process of incorporating in Madeira is more complicated than it needs to be. You are supposed to have 2 members on the account – although one is possible. There is a somewhat high requirement for capitalization, registered quotas as they are called, for 5000 euros.

The government tries to sneak in fees whenever they can. For instance, you will pay an “installation fee” of 1000 Euros. Then, each year after you will have to pay an annual operating fee of 1800, and 0.5% of your profit in the previous year over a certain amount. Also, there is a VAT tax of 22%.

Not enough reasons? Company meetings must be in Madeira or recorded as being held in Madeira by a proxy.

The country has a civil law system and the company documents must be filed in Portuguese, accounts must also be maintained in Portuguese. Easy enough to pay someone else to do, but a pain, and somewhat unnecessary. For most people, documents in English in a common law jurisdiction will be preferable.

Madeira taxes are niggling. They aren’t large enough to be a major concern, but they exist, and those considered, it’s hard to see how Madeira could compete with other offshore jurisdictions that are completely tax-free. Madeira’s free trade zone makes sense for manufacturers, but for an internet business with no physical location and worldwide earned income, it makes sense to accept only jurisdictions with 0% tax. It should be blatantly obvious that Madeira is NOT where you want to set up your company.

Okay, I’ve nearly beaten you over the head with examples of where you wouldn’t want to incorporate your internet business. Now lets discuss where you do want to incorporate an internet business.

Where you DO want to set up your company…

If you are an internet entrepreneur that wants to set up offshore, you know you need to get your incorporation taken care of. Here are three of the best places in the world to set up your company.


Belize is a good place for an internet entrepreneur to incorporate. The costs for a Belize incorporation are some of the lowest in the world. A compelling aspect of a Belize corporation is the pairing with a Belize bank account. Banks in Belize will often set up an account for you without you having to visit the country. Belize is the only country in the Americas south of Mexico that speaks English as its native language.

Furthermore, banks in Belize are known to allow high-risk merchant accounts. If you are in the gambling, pharma or adult industry, these may be the last banks in the world that accept you.

Advantages of a Belize IBC

  • Don’t have to go there to set up a bank account
  • Great for merchant accounts
  • Can be used for a variety of different businesses
  • No taxes in Belize
  • Low set up costs
  • Grey hat

Downsides to a Belize incorporation:

  • Capitalization above 50k requires a substantial government fee. Wouldn’t be good for a trading account, or a holding company.
  • Belize is not the most reputable jurisdiction; most Belize IBC’s will bank in Belize.
  • Not great for shipping
  • Meetings/requirements

Set up a Belize IBC today


Nevis is one of the best places to incorporate from an asset protection standpoint. If you are running a business that is fraught with liability – it makes sense to go to a place where the claimant has to post a bond in order to bring a suit against you. Another such place is the Cook Islands. To reiterate, in order to sue your company, a person will have to file a suit in Nevis or the Cook islands and pay for the court proceedings.

Nevis does not have a country-wide register, and thus your incorporation has a good amount of privacy built in. Nevis is a decent choice for someone who needs to capitalize a company with more than $50,000, as the government fees increase dramatically for a Belize incorporation capitalized with more than 50k.

Advantages of a Nevis LLC:

  • Private
  • Good asset protection
  • Lawsuit protection
  • No need for meetings / requirements
  • Government and prime minister willing to discuss passports with entrepreneurs.

Downsides to a Nevis Incorporation:

  • Tax transparent
  • Not great reputation yet worldwide

Set up a Nevis LLC today

The best place in the world to set up your company: BVI


The British Virgin Islands is the best place to incorporate if you are an internet entrepreneur with worldwide income that you want to park offshore. BVI has the most reputable company formation set ups of all the offshore jurisdictions, as evidenced by banks’ willingness to deal with the British Virgin Islands. One of the most advantageous aspects of a BVI International Business Company, or IBC, is that you can pair this incorporation set up with a bank account in a reputable jurisdiction, such as Hong Kong or Singapore. Asian banks are particularly willing to work with BVI companies, and may be more hesitant with a company from somewhere else, like Guatemala.

The process to get a bank account with a BVI company works as follows:

  1. Order a company from, provide the necessary documents to incorporate in BVI.
  2. Receive company documents from your BVI registered agent and walk into a bank in Singapore.
  3. Provide company documents, satisfy KYC and AML requirements for the banker with the following forms: Certificate of good standing, apostilled, certificate of incumbency, apostilled.

Basically – everything you need to incorporate + 2 documents which show the company is in good standing, and that you are the real owner of the company and have signatory authority for accounts.

You now have a BVI incorporation with a Singapore bank account (or Hong Kong, or Luxembourg or any bank account for that matter).

Why are banks so willing to work with BVI?

The country takes the requirements for filing companies seriously – they have been established for quite some time as an offshore center, and there are additional forms that are required to set up an IBC in BVI, namely, the beneficial owners declaration or “BOD”. Banks feel comfortable with this jurisdiction.

It’s clear that BVI is the worldwide leader for internet entrepreneurs looking for an incorporation set up located offshore. While it’s not as cheap as a place like Belize, and the registered office fees and government fees are somewhat higher – the scalability, worldwide usage, privacy, flexibility and reputation make BVI a premier place to incorporate.

Advantages of a BVI IBC

  • Bearer / Privacy
  • Banking Worldwide
  • Reputable Jurisdiction

Downsides of a BVI Company:

  • None

Set up a BVI company today

Belize, Nevis, and BVI are 3 great options for internet entrepreneurs who need to incorporate offshore. BVI is the best jurisdiction for internet entrepreneurs looking to incorporate.

These are important jurisdictions for incorporation of purely internet based companies moving forward. For the 3 best incorporations for businesses shipping physical products, be sure to check out Asset Protection for the digital entrepreneur.