Company formation in the Cayman Islands
The Cayman Islands remain the default domicile for investment funds and holding vehicles. They are a poor choice for operating revenue that needs day-to-day banking — and the difference matters more than the tax rate.
Corporate tax
0%
Formation time
About 5 days
Common vehicle
Exempted company
Best suited to
Funds & SPVs
Why founders choose Cayman
Cayman has no corporate income tax, no capital gains tax and no withholding tax, and its company law is closely modelled on English law, which institutional investors and their counsel already understand. For a fund, a joint-venture vehicle or a holding company sitting above licensed operating subsidiaries, that familiarity is the product.
What Cayman does not give you is easy transactional banking. Local banks are selective and expensive, and correspondent relationships treat Cayman operating companies cautiously. In practice we pair a Cayman holding entity with a licensed operating company elsewhere.
The exempted company in practice
- Incorporated under the Companies Act as an exempted company; no local trading permitted.
- One director minimum, no residency requirement, corporate directors allowed.
- No minimum share capital; shares usually issued at USD 1.00 par.
- Registered office with a licensed Cayman service provider is mandatory.
- Beneficial ownership reported to the competent authority, not to the public.
Economic substance and annual obligations
Cayman's economic substance regime applies to defined relevant activities — fund management, financing and leasing, holding company business, headquarters and others. Pure equity holding companies face a reduced test, but every entity files an annual notification and, where in scope, a substance return. Annual government fees and registered office fees are payable in January; late payment escalates quickly.
Funds and regulated activity
Open-ended funds register with CIMA under the Mutual Funds Act and closed-ended vehicles under the Private Funds Act, each with audit, valuation and custody requirements. Where your activity is gambling, payments, forex or crypto, Cayman is normally the holding layer only — the licence and the client money sit in a jurisdiction built for it, such as Malta, Lithuania or Gibraltar.
Company formation, banking and licensing handled together
We form the entity, prepare the due-diligence file the way an onboarding committee reads it, and take the licence application through to grant where one is required. Ownership chart, licence scope, AML/KYC policy and expected flows by corridor are prepared before any bank sees the file.
Frequently asked questions
How long does Cayman Islands company formation take?
Incorporation is typically complete within about five working days once due diligence on the beneficial owners and directors is signed off. Express incorporation is available at additional government fee.
Do Cayman companies pay tax?
There is no Cayman corporate income tax, capital gains tax or withholding tax. Tax may still arise where management, shareholders or customers are located, so the structure has to be reviewed against your home jurisdiction.
Can a Cayman company open a bank account?
Yes, but expect a selective process and higher minimums. For operating flows we normally bank the licensed operating entity elsewhere and keep Cayman as the holding vehicle.
Considering Cayman Islands for your structure?
We will confirm in writing whether it fits your regulator and your banks. Reply within 2 hours.
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