On 1 January 2023, significant changes to corporate law came into force in the British Virgin Islands (BVI). Among them is a new requirement for companies to file an Annual Return with the registered agent.
This requirement is in addition to the already existing obligation of BVI companies to keep their accounting records and supporting documentation sufficient to show and explain all of the company’s transactions and to determine its financial position.
The Annual Return is brief financial information and includes a simplified balance sheet and income statement. This financial information does not require an audit. The form of the Annual Return can be found in the Schedule to the Order issued by the BVI Financial Services Commission on 1 March 2023.
A company must file the Annual Return with the registered agent in the BVI within nine months after the end of the company’s financial year. The Annual Return will not be submitted to any government authority and will not be available to the general public.
If a company fails to provide the Annual Return to the registered agent, the agent must notify the Registrar of this within 30 days after the deadline for submitting the Return. In this case, the company will face penalties for each month of delay. The Registrar may also strike a defaulting company off the register.
The obligation to submit the Annual Return does not apply to:
- companies listed on a stock exchange;
- companies that are regulated under the BVI financial services legislation and submit financial statements to the BVI Financial Services Commission;
- companies that file their annual tax returns together with financial statements to the BVI Inland Revenue Department;
- companies in liquidation, except when the reporting year ended before the start of the liquidation procedure.
If the company’s financial year coincides with the calendar year, then the deadline for submitting the Annual Return will be 30 September 2024 (for the financial year from 1 January to 31 December 2023). The company can file the Return any time during the first nine months of 2024.
If the company’s financial year does not coincide with the calendar year, then the deadline for submitting the Annual Return also occurs nine months after the end of the company’s financial year. For example, the company’s financial year runs from 1 July 2023 to 30 June 2024. In this case, the company must submit the Annual Return by 31 March 2025.
The BVI companies whose financial year is the same as the 2023 calendar year or starts in 2023 are advised to arrange the preparation of their Annual Return after the end of their financial year and get their accounting records in order in good time.