SFM's Perspective on BVI's New Annual Financial Return Filing Requirements

In line with our commitment to keeping our clients informed and ensuring seamless compliance, SFM wishes to communicate the recent amendments to the BVI Business Companies Act, 2004, and BVI Business Companies Regulations. Effective from January 1, 2023, these changes mandate BVI companies to file an Annual Financial Return (AFR) containing specific financial information.

Key Points:

1. Confidential Filing Process:

The AFR must be filed exclusively with the company's BVI registered agent, ensuring confidentiality as it is not a public filing.

2. Form of AFR:

The BVI Business Companies (Financial Return) Order, 2023, enacted on March 2, 2023, outlines the structure and information required in the AFR. This includes a balance sheet/statement of financial position and an income statement.

The British Virgin Islands Financial Services Commission provides easy access to the Order and AFR form through this Download PDF here.

Companies forming part of a consolidated group can fulfil their obligations by submitting consolidated accounts or opting for a single filing that reflects the annual returns of each entity.

3. Due Date and Filing Date:

AFRs are due at the end of a company's financial year, be it the default calendar year or a specifically adopted fiscal year.

For companies with a calendar year financial period, the initial AFR is due on January 1, 2024, with a filing deadline of September 30, 2024.

Companies operating on a non-calendar fiscal year must file within nine (9) months of their financial year-end, providing flexibility and allowing certain companies to submit by 2025.

4. Exempt Entities:

Certain entities are exempt from filing AFRs, including those listed on a stock exchange, companies regulated under financial services legislation, those filing annual tax returns with the BVI Inland Revenue Department, and companies in liquidation, excluding those with due annual returns before the commencement of liquidation.

5. Accounting Rules and Penalties:

No specific accounting policies are prescribed, emphasizing the importance of maintaining accurate records and documentation.

AFRs are not required to be audited or certified, and companies have the flexibility to use any applicable currency for reporting.

Penalties apply for late filings, starting at US $300 for the first month and incrementally rising to a maximum of US $5,000.

Conclusion:

SFM is committed to assisting our clients in navigating these regulatory changes. We encourage proactive adherence to the new AFR filing requirements, ensuring that your BVI company remains in good standing. Our team is available to address any queries or provide guidance on the filing process . Please contact our dedicated team or email us at info@sfm.com. As always, SFM remains dedicated to facilitating your business success and compliance in a rapidly evolving regulatory landscape.