Kreston Bahamas
April 11, 2024
April 11, 2024
Pretino Albury, Partner at Kreston Bahamas, brings over a decade of expertise, serving clients in The Bahamas, Caribbean, and the USA. As a CPA, he specialises in management consulting, risk advisory, public accounting, and auditing across diverse industries.
March 17, 2024
Sector: Finance
Pretino Albury, Partner at Kreston Bahamas, contends that tax advisers must not overlook cryptocurrency with BEPS compliance, if they aim to cultivate more profound connections with their clients, in a recent article for ITR (International Tax Review). Click here to read the full article or read a summary down below.
Dealing with decentralised cryptocurrencies in the absence of global tax standards is challenging. With the worldwide rollout of the OECD’s BEPS framework, advisers and clients must collaborate to formulate an effective strategy. Robust policies aligning with international standards are essential to ensure compliance and minimise risks in cryptocurrency transactions. Below are critical considerations for crafting such policies.
Understand BEPS implications for cryptocurrency transactions by familiarising yourself with OECD guidelines, particularly Actions 10, 13, 5, and 15. Consult with clients to gather information on their cryptocurrency business activities, transactions, and risk appetite. Conduct thorough risk assessments, addressing transfer pricing and cross-border transactions. Implement a transparent transfer pricing model and design policies to handle hybrid mismatches in cross-border cryptocurrency transactions. Establish a BEPS-compliant KYC process for crypto transactions, including identity verification, beneficial owner identification, risk assessments, and ongoing customer activity monitoring. Mandate proper disclosure, robust record-keeping, and precise procedures for identifying, reporting, and paying taxes on cryptocurrency-related income.
Integrate risk mitigation into policies by developing strategies to identify and counter suspicious activity, protecting against fraud, theft, and regulatory sanctions. Include clear procedures for reporting suspicious activity, robust anti-money laundering programs, and legal expertise to prevent asset seizure. Implement cybersecurity measures to safeguard against cyberattacks and unauthorised access.
Educate client personnel comprehensively on the newly implemented cryptocurrency policies to ensure an understanding of requirements and risks. Provide training on the rationale behind each approach and their role in implementation and adherence.
Continuously check and review compliance by establishing a system to monitor adherence to the BEPS-compliant cryptocurrency policy. Stay updated on evolving regulations and tax laws, regularly reviewing and updating client policies to ensure ongoing compliance with changing rules and standards.
Utilise tech tools for efficiently monitoring cryptocurrency transactions, employing advanced technologies and analytics to trace transaction history and identify potential risks like money laundering and tax evasion. These tools can detect anomalies, assign risk scores, and enable real-time monitoring for immediate identification and recording of suspicious activity. Additionally, technology aids in staying updated on evolving rules and regulations across jurisdictions, ensuring accurate and timely tax calculations, payments, and reporting through AI, blockchain, and cloud systems.
Maintain open communication and collaboration with tax authorities to align cryptocurrency policies with expectations, preventing unforeseen issues and demonstrating commitment to compliance.
Building BEPS-compliant cryptocurrency policies is an ongoing process, requiring continuous collaboration and adaptation to the evolving cryptocurrency landscape. Advisers must partner effectively with clients for the long term, implementing and maintaining robust policies. By following these steps, advisers can navigate the complexities of cryptocurrency taxation, minimize BEPS risk, and strengthen client relationships in a landscape with an estimated 420 million crypto users worldwide.
Interested in doing business with Kreston Global? Click here to get in touch.
Pretino Albury, Partner at Kreston Bahamas, brings over a decade of expertise, serving clients in The Bahamas, Caribbean, and the USA. As a CPA, he specialises in management consulting, risk advisory, public accounting, and auditing across diverse industries.
February 16, 2024
Sector: Finance
Pretino Albury, Partner at Kreston Bahamas, contends that tax advisers must not overlook cryptocurrency with BEPS compliance, if they aim to cultivate more profound connections with their clients, in a recent article for ITR (International Tax Review). Click here to read the full article or read a summary down below.
Dealing with decentralised cryptocurrencies in the absence of global tax standards is challenging. With the worldwide rollout of the OECD’s BEPS framework, advisers and clients must collaborate to formulate an effective strategy. Robust policies aligning with international standards are essential to ensure compliance and minimise risks in cryptocurrency transactions. Below are critical considerations for crafting such policies.
Understand BEPS implications for cryptocurrency transactions by familiarising yourself with OECD guidelines, particularly Actions 10, 13, 5, and 15. Consult with clients to gather information on their cryptocurrency business activities, transactions, and risk appetite. Conduct thorough risk assessments, addressing transfer pricing and cross-border transactions. Implement a transparent transfer pricing model and design policies to handle hybrid mismatches in cross-border cryptocurrency transactions. Establish a BEPS-compliant KYC process for crypto transactions, including identity verification, beneficial owner identification, risk assessments, and ongoing customer activity monitoring. Mandate proper disclosure, robust record-keeping, and precise procedures for identifying, reporting, and paying taxes on cryptocurrency-related income.
Integrate risk mitigation into policies by developing strategies to identify and counter suspicious activity, protecting against fraud, theft, and regulatory sanctions. Include clear procedures for reporting suspicious activity, robust anti-money laundering programs, and legal expertise to prevent asset seizure. Implement cybersecurity measures to safeguard against cyberattacks and unauthorised access.
Educate client personnel comprehensively on the newly implemented cryptocurrency policies to ensure an understanding of requirements and risks. Provide training on the rationale behind each approach and their role in implementation and adherence.
Continuously check and review compliance by establishing a system to monitor adherence to the BEPS-compliant cryptocurrency policy. Stay updated on evolving regulations and tax laws, regularly reviewing and updating client policies to ensure ongoing compliance with changing rules and standards.
Utilise tech tools for efficiently monitoring cryptocurrency transactions, employing advanced technologies and analytics to trace transaction history and identify potential risks like money laundering and tax evasion. These tools can detect anomalies, assign risk scores, and enable real-time monitoring for immediate identification and recording of suspicious activity. Additionally, technology aids in staying updated on evolving rules and regulations across jurisdictions, ensuring accurate and timely tax calculations, payments, and reporting through AI, blockchain, and cloud systems.
Maintain open communication and collaboration with tax authorities to align cryptocurrency policies with expectations, preventing unforeseen issues and demonstrating commitment to compliance.
Building BEPS-compliant cryptocurrency policies is an ongoing process, requiring continuous collaboration and adaptation to the evolving cryptocurrency landscape. Advisers must partner effectively with clients for the long term, implementing and maintaining robust policies. By following these steps, advisers can navigate the complexities of cryptocurrency taxation, minimize BEPS risk, and strengthen client relationships in a landscape with an estimated 420 million crypto users worldwide.
Interested in doing business with Kreston Global? Click here to get in touch.
December 20, 2023
July 1, 2023, marked a significant milestone for The Bahamas’ business community with the enactment of the Business Licence Act, 2023. This act not only replaces the old licensing legislation but introduces a fresh, more comprehensive regulatory framework. This shift, steered by the Department of Inland Revenue (DIR), aims to streamline and modernise the process of obtaining and maintaining business licenses in The Bahamas.
Read the full Bahamas Business Licence Act 2023 factsheet here
Small businesses, often the backbone of the economy, receive a welcome simplification. If your business earns less than $250,000 annually, you’re now exempt from submitting an independent accountant certification to the Secretary. Yet, keeping accurate records for at least five years remains vital, and the annual license renewal process continues as usual.
For those in the middle tier, there’s an added layer of accountability. You’ll need an independent accountant’s review report, aligned with the International Standards on Review Engagements (ISRE 2400 revised).
The bigger players in the market are required to obtain an independent accountant’s audit report, following International Standards on Auditing (ISA).
The new act isn’t just about licensing. It brings into play broader disclosure requirements, ensuring businesses are transparent about their revenue streams, deductions, related party transactions, and accounting policies. This transparency is key to maintaining a fair and competitive market.
The Bahamas Institute of Chartered Accountants (BICA) is at the forefront of this transition. Under the guidance of Pretino Albury, BICA President and Attestation & Assurance Leader at Kreston Bahamas, the institute is actively liaising with the government to ensure these changes benefit both businesses and the economy.
The act also touches on International Business Companies (IBCs) and financial services entities. Those without domestic operations and capped at a $100,000 tax can now submit financial statements audited outside The Bahamas, easing their compliance burden.
Understanding and adapting to these changes is crucial for businesses operating in The Bahamas. For more detailed insight and guidance, contact Pretino Albury at Kreston Bahamas. Contact him at ppalbury@krestonbs.com or visit Kreston Bahamas for more information and assistance.
July 6, 2023
Investing in The Bahamas may be worth a second look with current economic developments stimulating an impressive post-Covid recovery. The Bahamas has a long history of generating GDP through high-end tourism and offshore banking. Since the turn of the decade, the Bahamas has had to deal with a number of challenges, including a decline from $13.06B to $9.5B in GPD during Covid. With post-Covid return in 2022 to $12.9B.
The island nation continues to actively position itself as a hub for cryptocurrency investors. The government is also looking to monetise some of its glorious natural assets by exploring sustainability initiatives, such as launching a blue carbon credit scheme.
We spoke to partners at our firm in The Bahamas Kreston Bahamas, Pretino Albury and Sean Rolle, about these developments. Kreston Bahamas joined the network in 2021 and have already referred considerable business to the network. Pretino comments,
“Since the COVID-19 lockdown, The Bahamas has experienced notable economic growth, particularly in the tourism sector, which has historically been the largest industry in the country. Despite the initial challenges posed by the pandemic, the gradual easing of travel restrictions and the successful implementation of health and safety protocols have played a crucial role in reviving the tourism sector. The positive momentum in the tourism sector has had a ripple effect on other industries, such as hospitality, transportation, and retail, contributing to the overall economic growth and recovery of The Bahamas. This recovery has yielded an estimated growth rate of 2% (according to the International Monetary Fund (IMF)) after a decline in 2020 due to the COVID-19 outbreak.”
It is no surprise, then, to see growth in Kreston Bahamas across tourism, leisure and hospitality, construction, and retail. Unsurprisingly Covid has left a mark on how tourism businesses want to operate. Clients want the assurance that they can rely on outsourced services to navigate through challenging times, such as business closures, by easily turning them on and off as needed. Pretino comments, “Covid has changed the business landscape. Now there is a focus on outsourcing back-office functions with a ‘white glove service’ approach. Clients want to feel that they can survive the shock of closure by easily turning suppliers off when they don’t need them.”
Sean Rolle adds,
“The Bahamas has a stable political environment, a well-developed infrastructure, and a highly skilled workforce. However, governmental approval is required for foreign investment in some areas such as wholesale and retail operations, real estate and property management services, small-scale construction projects, commercial fishing, and many small business activities.”
The government, keen to get ahead of some of the grey areas surrounding cryptocurrency, is developing the Digital Assets and Registered Exchanges Bill, 2023, which is currently out for consultation with the objective of reintroduction to the global market. While regulations surrounding cryptocurrency are evolving, investors remain committed to this market. Pretino comments,
“There has been some significant sell-off; however, from what I have seen, investors are still committed to this market. They have become more strategic in investing in crypto assets backed by underlying, measurable, and sometimes tangible assets or investments with the greatest utility. Additionally, there has been a shift towards protecting crypto investments by staking their holdings and using “cold” wallets, which provide offline storage solutions. Cold wallets seem to be the best option for keeping crypto safe from hackers or companies that go bankrupt. Despite recent episodes of failed cryptocurrency projects, the hype around cryptocurrency as a viable investment option and a disruptor in the digital finance space continues to gain momentum at its own pace.”
Pretino and Sean see significant opportunities not only for investors but also for their firm’s growth plans. Sean comments,
“Looking ahead, several investment trends are expected to shape the Bahamas’ economic landscape. Public Private Partnerships are anticipated to play a significant role, fostering collaboration between the government and private entities to drive infrastructure development and public service enhancements. Tourism-related opportunities remain attractive for investors considering the Bahamas. Additionally, investment trends like ESG (Environmental, Social, and Governance) initiatives, carbon credits, and the forthcoming Digital Assets and Registered Exchanges Bill, 2023, are expected to shape future investment opportunities. The government’s commitment to strengthening small and medium enterprises (SMEs) and local entrepreneurship is another promising trend. As the Bahamas fosters an environment conducive to SME growth, foreign investors can explore opportunities for collaboration and investment within this sector. As a firm, we are looking forward to the opportunities this activity will bring to the island and have made plans to expand both nationally and across the rest of the Caribbean.”
As foreign investors seek to capitalise on the Bahamas’ potential, staying informed about regulatory changes, understanding investment trends, and seeking expert advice remain critical components of achieving success in this vibrant market.
The Bahamas has not been untouched by Organization for Economic Cooperation and Development (OECD) policy, challenging its tax haven status. The Ministry of Finance has recently announced the release of a Green Paper on “Corporate Income Tax Strategies for The Bahamas,” aimed at gathering feedback from stakeholders. The government seeks to improve efficiency and equity in the business tax regime and align with global tax developments. The paper addresses the challenges posed by OECD requirements for Pillar Two tax reforms and the limitations of the existing business license tax (BLT). The proposed strategies include options for a 15% minimum effective tax rate, with variations based on firm revenues and thresholds. Sean comments,
“Although the consultation period is still ongoing, it will be a step-change for multinational enterprises doing business in the Bahamas. Reaching out to our experts here on the island early can help businesses better prepare for any potential effects this might have on their operations.”
If would like to know more about investing in The Bahamas please get in touch with Sean or Pretino at Kreston Bahamas.
June 27, 2022
December 6, 2021
The growth of the Kreston network is in the news again following the addition of two new Kreston firms. The article in International Accounting Bulletin covers the addition of Kreston Bahamas and Kreston Bahrain, who have joined the network as Kreston branded firms.
Liza Robbins, CEO of Kreston Global, said,
“I would like to welcome our new colleagues in The Bahamas and Bahrain to the Kreston Global network in an exciting period of growth as international business recovers from the pandemic. These two firms, so geographically far apart, embody the spirit of excellence and collaboration that we at Kreston Global have always championed. We look forward to working with them to build on their many successes to date, both in their respective regions and beyond.”
Click here to read the full article (subscription required).
Visit our doing business in the Bahamas and doing business in Bahrain for helpful insight on expanding your business into these countries.
November 16, 2021