Seychelles IBC: uses, tax position and compliance for Indian owners
A Seychelles International Business Company is relatively low-cost to form and maintain, but since 2021 its accounting records must be kept in Seychelles. The tax position and the Indian rules explained.
The Seychelles International Business Company (IBC) has long been a low-cost vehicle for international trading and holding. Reforms since 2019 mean it now comes with real record-keeping and tax rules, and Indian residents also need to check the ODI conditions.
Forming an IBC
- IBCs are formed under the International Business Companies Act, 2016, through a registered agent licensed by the Financial Services Authority.
- The minimum is one director and one shareholder; corporate directors are permitted, and there is no nationality or residence requirement.
- A register of beneficial owners is maintained under the Beneficial Ownership Act, 2020.
Accounting records — the 2021 change
Since the 2021 amendment to the IBC Act, accounting records must be kept at the company's registered office in Seychelles. They must be updated at least twice a year — in practice, records for January to June by 31 July and for July to December by 31 January — and kept for at least seven years. Many IBCs must also prepare an annual financial summary within six months of the financial year end, kept at the registered office. These records are not filed publicly, but a company that does not comply can be fined.
How IBCs are taxed
Since 1 January 2019, IBCs pay Seychelles business tax on Seychelles-source income. Since 15 September 2021, a company that is part of a multinational group is taxed in Seychelles on its foreign passive income unless it meets the economic substance requirements, and on income from activities carried on outside Seychelles unless that income is attributable to a permanent establishment abroad. An IBC that is not part of a multinational group and earns income only from activities carried on outside Seychelles generally has no Seychelles-source income.
International standing
Seychelles was removed from Annex I of the EU list in February 2024 and from Annex II in February 2026, after the OECD Global Forum rated it "largely compliant". India and Seychelles have no double taxation agreement; a tax information exchange agreement has been in force since 28 June 2016.
The Indian side
For a resident individual, the IBC must be an operating business that is not in financial services and has no subsidiary the individual controls; a passive holding IBC generally does not qualify. Form FC is filed through your bank, an Annual Performance Report is generally due by 31 December each year, and — for resident and ordinarily resident individuals — the holding is disclosed in Schedule FA. If the company is in practice managed from India, its place of effective management may make it resident in India for tax. See our ODI checklist.
Seychelles or the UAE?
If you need a local bank account, residence visas or a presence that customers recognise in the Gulf, compare a UAE offshore or free zone company; our colleagues at pbz.ae keep UAE books and returns in order. See our Seychelles page or talk to a partner.
Sources: International Business Companies Act, 2016 and the International Business Companies (Amendment) Act, 2021; Business Tax (Amendment) Acts, 2018 and 2020; Beneficial Ownership Act, 2020; Council of the EU, list of non-cooperative jurisdictions (revisions of 20 February 2024 and 17 February 2026); India–Seychelles TIEA (in force 28 June 2016; Notification No. 80/2016); Foreign Exchange Management (Overseas Investment) Rules, 2022.