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Business Permits & Incorporation for Foreigners in Nassau

Good to know

Good to Know

  • Registering a company (IBC or domestic) with the Registrar General's Department is a separate step from getting a Business Licence to actually trade — many foreigners incorporate but then get stuck because they skipped the Business Licence application with Inland Revenue.
  • An IBC is built for international/offshore activity; if you actually plan to sell to Bahamian customers or lease local commercial space, you likely need a domestic company and should check whether your sector is on the list reserved for Bahamian nationals before investing time and money.
  • The Bahamian dollar (BSD) is pegged 1:1 to the US dollar, so local-currency and USD fee figures are effectively identical — useful for budgeting.
  • You do not need to travel to Nassau to incorporate; the entire process, including document signing, can be handled remotely through a licensed registered agent.
  • The Bahamian dollar (BSD) is pegged 1:1 to the US dollar, so BSD figures and USD figures are numerically identical — useful for quick budgeting.
  • The Business Licence Tax is charged on gross turnover, not profit — a loss-making business still owes this tax if it has revenue.
  • Non-Bahamians must get Bahamas Investment Authority approval before incorporating ANY business structure, not just IBCs — this step is often overlooked by first-time founders.
  • About 15 business sectors (including retail, small-scale construction, and commercial fishing) are reserved for Bahamians, so foreign ownership in these areas needs special government approval regardless of which company structure you choose.
  • An IBC is only 'tax-light' if it genuinely doesn't trade within The Bahamas — running a real Nassau-facing business through an IBC without local substance can still trigger Business Licence Tax and, for certain activities, economic substance obligations.
  • National Insurance contributions are mandatory for self-employed foreigners too, even if you're a non-resident just freelancing locally.

Business Tax And Structure Options

Key Distinction For Nomads
The practical line is less 'freelancer vs. company' and more 'does the work happen locally in Nassau or purely for clients abroad.' Purely foreign-client freelance/consulting work can often run through a simple Self-Employed Work Permit + sole-proprietor Business Licence, with no need to form a full company. Anyone wanting a locally-trading business, hiring staff, or seeking liability protection typically needs a full Domestic Company or IBC, each requiring Bahamas Investment Authority approval as a non-Bahamian before incorporation.

VAT

Standard Rate Percent
12
Registration Threshold
BSD 100,000
Note
Registration is mandatory once taxable turnover meets or exceeds this threshold within any 12-month period; some activities require registration regardless of turnover. VAT applies to most goods, services, and imports.

Business Licence Tax

Approximate Tiered Rates Note
Rates are turnover-tiered (roughly: exempt or flat low fee under ~BSD 50,000–100,000 turnover; around 0.5% in a mid-tier band; rising to over 1% at higher turnover bands, with a different, generally lower schedule for IBCs deriving purely international income). Exact current tier thresholds vary between sources reporting on the pre-2023 vs. post-2023 Act, so treat precise percentages as indicative rather than exact — confirm current tiers with the Department of Inland Revenue before budgeting.
Annual Renewal
All Business Licences expire 31 December each year and must be renewed annually.
New Registration Flat Fee
BSD 100
Description
Every business operating in or from The Bahamas — including foreign-owned companies, IBCs conducting local activity, and sole proprietors/freelancers — must hold an annually renewed Business Licence and pay Business Licence Tax based on gross turnover for the preceding calendar year, under the Business Licence Act 2023.

Corporate Tax Overview

Corporate Income Tax
None. The Bahamas does not levy a corporate income tax, capital gains tax, withholding tax, or tax on dividends/interest for resident companies, whether foreign-owned or domestic. This applies to both Domestic Companies and International Business Companies (IBCs).
Real Tax Burden Mechanism
Instead of income tax, the government collects revenue mainly through the annual Business Licence Tax (assessed on gross turnover, not profit) and Value-Added Tax (VAT), plus import duties and stamp duty on certain transactions.
Pillar Two Note
A Domestic Minimum Top-up Tax (DMTT), enacted November 2024, only applies to large multinational enterprise groups with global revenue of roughly EUR 750 million / USD 850 million or more — this will not affect a typical foreign-owned small business or freelancer operation in Nassau.

Structure Types For Foreigners

  • Sole Proprietorship / Freelancer
    Cons
    No liability protection (personal assets exposed to business debts); still requires the same Business Licence Tax, VAT-if-threshold-crossed, and mandatory National Insurance contributions as any other business.
    Pros
    Simplest, cheapest, fastest structure — no separate legal entity, minimal formal filings if turnover stays low.
    Process
    Requires a Self-Employed Work Permit (with Bahamas Investment Authority approval for non-Bahamians) before registering, then a Business Licence application through the Ministry of Finance's Business Licence Unit, plus National Insurance registration.
    Who Its For
    A foreigner working alone as a consultant, freelancer, or small local service provider.
    Cost Note
    New Business Licence registration flat fee is BSD 100; ongoing Business Licence Tax scales with turnover as above.
  • Domestic Company
    Cons
    Certain sectors (about 15, including retail, small-scale construction, commercial fishing, and most other small-business categories) are reserved for Bahamians, and non-Bahamian participation in these requires specific government approval.
    Pros
    Limited liability protection; recognized local legal entity.
    Process
    Requires Bahamas Investment Authority project-proposal approval, incorporation via the Registrar General's Department, a registered office, and a Business Licence once operational.
    Who Its For
    A foreigner intending to trade locally in Nassau/The Bahamas (e.g. serving Bahamian clients, opening a physical local business).
    Cost Note
    Incorporation and annual licence fees are broadly comparable to IBC fees noted below, plus ongoing Business Licence Tax on turnover.
  • International Business Company (IBC)
    Cons
    If the IBC does conduct business in or from The Bahamas (i.e., serves local clients or has local operations), it is subject to Business Licence Tax on that turnover just like a domestic company. Certain 'relevant activities' (e.g. acting as a group holding company, or a distribution/service center for affiliated companies) trigger economic substance requirements under the Commercial Entities (Substance Requirements) Act — meaning the company must be genuinely directed, managed, and staffed from within The Bahamas.
    Pros
    Fast formation (often 1–5 business days), minimal capital requirements (commonly USD/BSD 50,000 authorized, one share can be issued), strong privacy (shareholder/director details not publicly filed), and if the IBC does not conduct business in or from The Bahamas it is not required to hold a Business Licence or pay Business Licence Tax at all.
    Process
    Must be formed through a licensed registered agent (attorney, licensed accountant, or bank/trust company) — foreigners cannot self-file. Filed with the Registrar General's Department under the International Business Companies Act.
    Who Its For
    A foreigner running an internationally-facing business (consulting, holding structure, online business serving clients outside The Bahamas) with little or no domestic trading activity in Nassau.
    Cost Note
    Government incorporation fee for standard authorized capital (~USD/BSD 50,000) is roughly BSD 350–425 depending on the fee schedule cited, plus a similar annual government renewal fee due every January.

Filing And Reporting Obligations

National Insurance
All employers, employees, and self-employed persons — including non-residents — must register with the National Insurance Board and pay National Insurance contributions.
Accounting Standard
Financial reporting generally follows IFRS or IFRS for SMEs.
Audited Financials Threshold
BSD 5,000,000
Annual Business Licence Return
Businesses with turnover under roughly BSD 250,000 generally have no additional filing beyond licence renewal. Between roughly BSD 250,000 and BSD 5,000,000, a Business Licence Return must be filed together with an independent practitioner's report on turnover, due no later than 31 March.
Audit Note
Companies with turnover above this threshold must submit audited financial statements (IFRS or US GAAP) audited by an accountant licensed by the Bahamas Institute of Chartered Accountants (BICA).

Incorporation Process And Requirements

Official Government Link
https://www.rgd.gov.bs/service/incorporation-of-an-international-business-company
Physical Presence Required
No
Official Domestic Company Link
https://www.rgd.gov.bs/service/incorporation-of-a-regular-company

Timeline

Official Registry Processing
The Registrar General's Department offers Express Incorporation (about 1 hour) or Regular Service (about 48 hours) once a complete filing is submitted.
Additional Step For Operating Businesses
Foreigners planning an actual local operating business should budget extra time for Bahamas Investment Authority review of the Project Proposal and for the separate Business Licence application, which run on their own timelines outside the company registration itself.
Realistic End To End Via Registered Agent
Most registered agents quote 2–5 business days total from engagement to receiving the Certificate of Incorporation, once all KYC documents and filings are in order.

Core Steps

  • Choose structure: IBC (for international/offshore business) vs. domestic Regular Company (for local trading).
  • Reserve and get approval for the company name with the Registrar General's Department (name must end in an approved suffix such as Ltd., Inc., Corp., or S.A., and cannot duplicate an existing name).
  • Engage a licensed registered agent in Nassau (mandatory for IBCs) to prepare and file documents.
  • Prepare and file the Memorandum and Articles of Association, along with identity/address documents for all directors and shareholders.
  • If establishing an operating (non-IBC) business, submit a Project Proposal to the Bahamas Investment Authority covering the nature of the business, investment amount, and employment plans.
  • Pay the government incorporation fee; the Registrar issues a Certificate of Incorporation once filings are approved.
  • Separately register for a Business Licence with the Department of Inland Revenue to legally operate/trade — this is distinct from registering the company itself.
  • Open a Bahamian (or international) corporate bank account, which typically requires the Certificate of Incorporation, business licence, and identity documents for signatories.

Typical Cost

Annual Government Licence Fee Standard Ibc
BSD 400
All In Formation Package Via Private Registered Agent
BSD 1,400

Private formation/registered-agent firms typically bundle government fees, one year of registered agent/office service, and document handling into an all-in package; quotes seen ranged roughly 1,390–2,000 for the first year, on top of the bare government fee.

Government Incorporation Fee Ibc Share Capital Over 50000 USD
BSD 1,200
Government Incorporation Fee Ibc Share Capital Under 50000 USD
BSD 400

Typical Documents Required

  • Notarized copy of passport for each director/shareholder
  • Notarized proof of residential address (utility bill, bank statement) dated within the last 3–6 months
  • Memorandum and Articles of Association
  • Bank and/or professional reference letter for beneficial owners (commonly requested by registered agents/banks)
  • Description of intended business activity

Local Partner Or Sponsor Mandates

Detail
No Bahamian co-owner or shareholding partner is legally required for either an IBC or a domestic company — 100% foreign ownership is allowed. However, two mandatory local touchpoints exist: (1) a licensed Bahamian registered agent must file and hold the company's registered office/records (this is a legal filing requirement, not an equity stake), and (2) foreigners establishing an actual operating business (as opposed to a pure offshore IBC) must submit a Project Proposal to the Bahamas Investment Authority (BIA) for approval before proceeding, particularly for activities touching the National Investment Policy's list of sectors reserved for Bahamians (e.g. retail, small-scale construction, commercial fishing, many small businesses), where government approval for foreign investment is required case-by-case.
Equity Partner Required
No
Registered Agent Mandatory
Yes

Structures Available To Foreigners

  • International Business Company (IBC)
    Purpose
    The standard vehicle for foreigners doing business internationally from The Bahamas (offshore holding, trading, consulting, etc.). Not intended for trading with Bahamian residents.
    Governing Law
    International Business Companies Act
    Foreign Ownership
    100% foreign ownership permitted; no residency or nationality restriction on directors or shareholders. Minimum of one director and one shareholder, who may be the same person and may be individuals or corporate entities.
  • Domestic / Regular Company
    Purpose
    Used to trade locally with Bahamian residents/businesses (e.g. a nomad-run shop, restaurant, agency serving the local market).
    Governing Law
    Companies Act
    Foreign Ownership
    Foreigners can own and operate Bahamian domestic companies, but certain sectors are reserved for Bahamian nationals and require government approval before a foreigner can invest in them.
AI-generated estimateData refreshed July 2026

Sources cited for this category

These are the sources cited in this business permits & incorporation for foreigners research for this city. Individual figures may not each trace to one of them.

  1. 1.rgd.gov.bs
  2. 2.rgd.gov.bs

More About Nassau

Data last updated July 2026 · Verify anything important.