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Cayman Islands Considered Premier Tax Neutral Global Financial Hub

Updated: Apr 9

The Cayman Islands is a premier global financial hub, efficiently connecting law-abiding users and providers of investment capital and financing around the world – benefiting both developed and developing countries. The jurisdiction has built a reputation for excellence and recognition as a leader in international finance thanks to a unique combination of competitive advantages:

  • a trusted, expert legal framework and high regulatory standards;

  • a pure tax neutral regime;

  • industry leadership in key sectors;

  • world class professionals and credibility; and

  • commitment to global standards

Legal Framework & Regulatory Standards

The Cayman Islands’ legal system is based on English common law with the UK Privy Council serving as Cayman’s final court of appeals. In addition, Cayman has developed specialised financial services legislation that reflects an innovative, pragmatic approach.

Cayman’s regulatory regime enhances the reputation of the jurisdiction as a leading financial centre. The regulatory balance in the Cayman Islands supports appropriate, effective and efficient supervision of financial services in accordance with relevant international standards.

The Cayman Islands features a close collaboration between government and industry, supporting a commitment to stability, transparency, integrity and professionalism.

Pure Tax Neutral Regime

The Cayman Islands’ policy of pure Tax Neutrality is the most simple and transparent way possible to eliminate the threat of double taxation for institutional investors using an intermediate jurisdiction for global investments.

Cayman’s pure Tax Neutral regime automatically alleviates double taxation by allocating all of the taxing rights to an investor’s or parent entity’s home jurisdiction. Cayman’s pure Tax Neutral regime – including a zero corporate income tax rate — also transparently provides the same stated and effective tax rates.

Industry Leadership in Key Sectors

The Cayman Islands stands out because it offers a diverse set of financial services and is a recognised global leader in key industry sectors.

Approximately two-thirds of the world’s international hedge funds are domiciled in Cayman. The Cayman Islands is the second largest domicile in the world for captives and the number one domicile for healthcare captives and group captives. Cayman is already a leading jurisdiction for banking, trusts, capital markets, fiduciary services, shipping registry and is developing into a premier choice for domiciling non-traditional reinsurance companies.

World Class Professionals and Credibility

The Cayman Islands is home to a highly competitive market for legal services with deep, global expertise in many areas of law. A range of companies offer everything from director services and AML compliance to serviced offices. Cayman’s growth in financial services has also attracted major accounting practices, boutique accounting firms and other kinds of advisory services. Banking in Cayman also meets the demands of international investors, with 118 non-retail banks and 6 retail banks in the jurisdiction.

Commitment to Global Standards

Over the past two decades, Cayman has implemented globally-agreed standards to address tax fraud, money laundering, terrorist and proliferation financing and has assisted in the development of those standards. Cayman also has earned the OECD’s second highest rating for transparency – the same rating given to the UK, Germany, Canada and Australia.

IMS is one of the longest established company management firms in the Cayman Islands. IMS is licensed by the Cayman Islands Monetary Authority to provide independent directors, company management and incorporation, mutual fund administration, captive insurance and trust services. For more information about our services, please contact us.

Disclaimer: this publication does not constitute legal or professional advice and should not be relied on as such.

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