The John McAfee drama continues to unfold in Central America as the eccentric multi-millionaire is recovering following two minor heart attacks. The founder of the pioneering antivirus software company, which bears his name, is currently being held in a police-run hospital in Guatemala after his request for political asylum was denied. McAfee is to be returned to Belize where he is wanted for questioning in relation to the death of his neighbor, Gregory Viant Faull[1].
The two men live on the same island in Belize, and what seems to be a neighborly argument about pets, now brings international attention to a tiny Central American country. But what are two American ex-Patriots doing there? We can only speculate to what anyone’s true intentions are, but a major reason we find these posh beach and fishing communities with wealthy Americans in Central American and Caribbean is largely due to tax policy.
The IBC, when formed, is exempt from all local taxes. This means any investments will not be accountable to local tariffs one might expect in business such as dividend taxes, capital gains taxes or transfer of property taxes. This outlook applies to all property, investment, financial instruments and other IBC income or expenditures. To add to this generous stance, the government does not require the IBC to file a tax return of any kind or report any other additional sources of income in the company’s dealing.
Additionally, there are no currency restrictions on the IBC when dealing in Belize. This is important because although the Belize dollar is pegged 2 to 1 the US dollar, it is extremely convenient to not have to worry about additional currency stability issues or other FX issues in the company’s accounting. The presence of a mature financial services industry only further impacts the attractiveness of basing your company in Belize.
For these reasons, it is easy to see why a small out of the way country would be an attractive place to start a company. It should come as no surprise to find to wealthy Americans looking to avoid paying U.S. taxes living in expatriate communities such as Mr.McAfee’s in Belize.
Guest post by Adam Nikulicz, for The Ellsworth Law Group
[1] The deceased, Gregory Viant Faull, was shot to death in early November. Mr. McAfee is wanted for questioning in that matter. No warrant is currently issued and Mr. McAfee has not been named as a suspect. However Mr. Faull had apparently complained about the aggressive dogs that John McAfee had been keeping on his compound and McAfee’s history of keeping weapons on his compound, along with other aggravating behavior have made him a person of interest. Read more: http://www.usatoday.com/story/news/nation/2012/12/03/mcafee-software-belize-safe/1742
