The St Kitts Offshore Sector

17. Trusts and Foundations

17.1The Federation contains two trust jurisdictions, and it is Nevis, with its ring-fenced international exempt trust and multiform foundation, that hosts the overwhelming bulk of international settlements (see Chapters 8 and 9). St Kitts maintains its own, quite different, regime: a single unified trust statute serving domestic and international settlors alike, and a conventional foundation law of 2003 vintage. Neither is heavily used offshore, but each has genuine uses, and advisers who assume the two islands’ laws are interchangeable will mis-serve their clients.

17.2The design philosophies diverge at the root. Nevis sells privacy and aggressive creditor defences. St Kitts offers a registered, certificate-backed structure with moderate protective features. This chapter sets out the St Kitts rules and is candid about where they trail the Nevis product, because choosing the right island is the first decision, not an afterthought.

One statute for all trusts

17.3The Trusts Act 1996 (Cap 5.19), Act 23 of 1996, in force 2 April 1997 and amended through Act 11 of 2020, governs every trust created under St Kitts law. There is no ring-fencing of the Nevis kind: the same statute, registrar and rules apply whether the settlor lives in Basseterre or Boston.

17.4Within that unified frame the Act is modern and flexible. A trust may run for 100 years (s 17(1)). Charitable trusts are perpetual. Charitable purposes may be prescribed by ministerial order and need not be publicly beneficial (s 10). Non-charitable purpose trusts are permitted with designated enforcers (s 13). Spendthrift and protective trusts are expressly authorised (s 11). Corporate settlors, trustees and beneficiaries are all allowed, the settlor may be a beneficiary and may retain powers without invalidating the trust (s 19), the proper law may be expressly chosen and different aspects of the trust made subject to severable governing laws (s 14), and foreign forced-heirship claims are expressly excluded (s 18(1)). A protector is an optional office (s 25). Other than for “common trusts” it is reserved to lawyers, auditors and designated professionals, and a protector attracts no fiduciary liability absent bad faith (s 25(12)).

Registration: mandatory and constitutive

17.5The single most important practical feature of the St Kitts regime is that registration is not optional. The FSRC’s stated position is that no trust will be recognised under the laws of the Federation as valid and enforceable until the Registrar of Trusts has issued a certificate. At least one trustee must be resident (s 4(2)), and an attestation must be filed with the Registrar containing particulars of the trustees, settlor and beneficiaries, including beneficial-ownership particulars, reflecting the 2020 amendment (s 5). The register is maintained under s 86. An annual statement is due each year (s 60), with removal from the register after three years’ delinquency (s 60(5)). The Minister holds inspection powers (s 74 and following). The official fees are modest: registration of the attestation, and each annual statement, costs EC$270 (US$100, EC$2.70 = US$1) for an ordinary trust and EC$540 (US$200) for an exempt trust.

17.6A Nevis international exempt trust, by contrast, requires only minimal registration and the trust deed itself stays private (see Chapter 8). This is the single biggest practical differentiator between the islands. For a client whose priority is confidentiality, it is decisive against St Kitts. For one who wants a government certificate to show a lender, court or counterparty, it is the reason to choose it.

Asset protection, candidly compared

17.7The Act contains protective provisions, but it was not built as an asset-protection product. A creditor attacking a transfer into a St Kitts trust must prove an intent to defraud effectively beyond doubt, together with the settlor’s resultant insolvency, within a two-year limitation period, and must first post a creditor bond of EC$25,000 (s 21(7)). The Nevis International Exempt Trust Ordinance (NIETO, Cap 7.03 (N), as amended in 2015) goes markedly further on every axis:

17.8The Nevis bond has stood at EC$270,000 since the 2015 amendments, more than ten times the St Kitts figure. (The Nevis FSRC’s FAQ page still quotes the pre-2015 US$25,000 figure. The consolidated ordinance is unambiguous.) The clear conclusion is that the St Kitts Act is a solid general trust law, not an asset-protection product. Protective settlements belong in Nevis (see Chapter 8), and the guide says so plainly.

Tax treatment

17.9Where the trustees transact exclusively with non-residents, the Act’s exempt-trust provisions relieve beneficiaries of income, capital gains and withholding taxes. No estate, inheritance, succession or gift charges arise on trust property, and securities transactions are exempt from stamp duty. These exemptions were not dismantled in the 2018–2019 reforms, which targeted the exempt-companies regime (see Chapter 19), and the FSRC continues to publish them as current in 2026. Two reminders temper their value: the Federation levies no personal income tax in any event (see Chapter 24), and a trust is transparent to most onshore tax systems. The settlor’s or beneficiaries’ home-country law, not St Kitts law, usually determines the real burden.

The Foundations Act 2003

17.10St Kitts also offers a foundation under the Foundations Act 2003 (Cap 21.19), Act 8 of 2003, in force 12 February 2004, amended in 2007, 2011 and 2024. Registration is again constitutive: the foundation becomes a separate legal person on registration (s 3(2)), effected by delivering its articles together with a statement of name, registered office, initial assets, ordinary or exempt status and secretary (s 4), against a conclusive certificate (s 5).

17.11The organs are conventional. A founder makes an irrevocable transfer of the initial assets. A council of at least one councillor manages (s 12). An optional guardian may supervise (ss 20–21). By-laws may regulate internal affairs (s 63). The mandatory local hook is the secretary, who must be licensed to conduct trust or corporate business (s 13), in practice a Basseterre service provider (see Chapter 19). There is no statutory minimum endowment. Duration is indefinite unless the articles limit it (s 61(1)(f)), and continuance both into and out of St Kitts is permitted (ss 39–45). Protective provisions shield the foundation against foreign law and forced-heirship claims (s 24(1)) and add non-alienation and anti-seizure protections (s 25).

17.12Fees under the Second Schedule mirror the trust scale: EC$270 (US$100) for an ordinary foundation and EC$540 (US$200) for an exempt one, with an annual return due by month-end following each anniversary (s 66). The default penalties, once capped at four times the fee plus daily fines, were increased substantially by the 2024 amendment. An exempt foundation, one dealing exclusively with non-residents, enjoys full tax exemption (s 64), freedom from estate, inheritance and gift taxes (s 64(3)) and stamp-duty exemption (s 65), provisions left untouched by both the 2018–2021 reforms and the 2024 amendment.

17.13Here too the comparison must be candid: the Nevis multiform foundation (see Chapter 9) is the more sophisticated instrument, able to take on trust, company or partnership identity, and far more used, with 233 Nevis multiform foundations on the register at end-2018 against no published St Kitts figure.

When the St Kitts vehicle is the right choice

17.14In our experience the St Kitts trust or foundation earns its place where the client positively wants a registered, certificate-backed structure: comfort for a lending bank, holding St Kitts real estate, or dealings with counterparties and courts that will ask for official proof of the arrangement’s existence. Privacy-driven and protective settlements go to Nevis. The Trusts Act has not been amended since 2020. The Foundations Act was amended by the Foundations (Amendment) Act 2024 (No. 16 of 2024, assented 17 July 2024), which tightened registration, notification and penalty provisions without disturbing the exemptions, and no further trust- or foundation-specific reform was in progress as at August 2026, though licensed fiduciaries administering these structures now sit within the FSRC’s 2026 administrative-penalty regime (see Chapter 19).

In practice. The trap is assuming the two islands’ laws are interchangeable: a settlor who wants privacy and creditor resistance but is placed into a St Kitts registered trust has bought the opposite of what was intended. Resolve the registration question first. If the client cannot accept filing settlor, beneficiary and beneficial-ownership particulars with a registrar, the conversation belongs in Charlestown, not Basseterre. Where St Kitts is right, secure the resident trustee before drafting begins: the licensed population is very small (see Chapter 19), and trustee capacity, not the law, is usually the constraint.

18. Limited Partnerships

18.1For nearly three decades the Limited Partnerships Act 1996 (Cap 21.12) was the only dedicated limited-partnership statute anywhere in the Federation. Nevis never included a partnership vehicle in its classic offshore suite, its flexible workhorse having always been the LLC, so until 2026 any St Kitts and Nevis limited partnership was, of necessity, a St Kitts registration. That monopoly ended on 1 February 2026, when the Nevis Limited Partnership Ordinance 2025 came into force (see Chapter 10).

18.2The St Kitts Act remains a serviceable and deliberately conventional instrument: an English-model partnership without separate legal personality, fiscally transparent, and cheap to establish and maintain. This chapter covers its mechanics, the exempt regime that gives it international utility, and how to choose between the settled Act and the new Nevis ordinance.

The statute

18.3The Act is Act 24 of 1996, in force 2 April 1997, and has been amended by Act 5 of 2011, Act 16 of 2018, Act 9 of 2019 and SRO 6 of 2019. The 2020 Revised Edition consolidates, and fees are prescribed under the Limited Partnerships (Fees) Order.

Structure and liability

18.4A limited partnership comprises one or more general partners, who manage the firm and bear unlimited liability, and one or more limited partners, who contribute capital and stand behind a liability shield. Certain fundamental acts by the general partners require the written consent of all limited partners (s 10). A limited partner has no liability for partnership debts (s 18), but loses the shield as against creditors who reasonably believed it to be a general partner if it takes part in management. A statutory safe-harbour list preserves the shield for specified acts (s 18(5)). Bodies corporate may serve as partners, and the same person may be both a general and a limited partner. The name must end in “Limited Partnership” or “L.P.” (s 9), and a limited partner whose surname appears in the firm name risks general-partner liability (s 9(4)).

18.5A common misconception is that the partnership is an entity in its own right. It is not: the Act takes the English aggregate approach, with no express separate legal personality, so partnership property, bank accounts, contracts and litigation all run through the general partners. The certificate of registration is conclusive evidence that the partnership was duly established (s 7), but clients should be advised early on the property-holding and litigation mechanics that follow from the aggregate model, which is one reason a corporate general partner is the standard arrangement.

Registration and administration

18.6Formation is quick and registry-driven. The name is reserved. The general partner, or, in practice, a licensed corporate-service provider acting as agent (see Chapter 19), files a declaration stating the name, duration and general-partner particulars, together with registered-office details and the nature of the business, with the Registrar of Limited Partnerships (ss 5–7). The Registrar allocates a number and issues the certificate, and the partnership exists on issue. An annual statement is then due before the end of each registration-anniversary month (s 22). Records must be kept for five years, with audit optional (s 26). Dissolution occurs by filing, automatically on the death or incapacity of a sole general partner unless replaced within 90 days, or by court order (ss 27–32). Public offers of partnership units engage a prospectus and civil-liability regime (ss 33–37). The Minister holds inspection powers (ss 38–42), and limited partners may petition on unfair-prejudice grounds (ss 50–51).

Exempt limited partnerships

18.7The Act’s international offering sits in ss 62–63. Where the general partners carry on business exclusively with non-residents, the partners are relieved of all income, capital gains and withholding taxes in respect of their partnership interests, with stamp-duty exemption on securities transactions. The status is not fragile: administering the partnership locally, executing contracts locally, and dealing with exempt residents and authorised banks do not forfeit it (s 62(2)). These provisions were retained in the 2020 Revised Edition and the FSRC continued to publish the exemptions as current in 2026. The partnership’s fiscal transparency made it far less objectionable to the OECD and EU reviewers than the exempt company, which was abolished outright (see Chapter 19). The 2018–2019 amendment Acts left ss 62–63 unconditioned. No sunset or grandfathering clause was attached to the partnership exemptions.

Costs

18.8No minimum capital is prescribed. Establishment costs EC$270 (US$100, EC$2.70 = US$1) for an ordinary partnership and EC$540 (US$200) for an exempt one, and each annual statement carries the same fee. The licensed provider’s professional charges, not the official fees, will be the real cost of the structure.

Uses, and the choice against Nevis

18.9Classic general/limited-partner economics suit closed-ended funds and carried-interest vehicles, joint ventures, family and estate planning (the senior generation holding as limited partners) and passive asset holding. Fiscal transparency plus the exempt regime make a St Kitts exempt limited partnership a genuinely low-cost fund wrapper, but there is no bespoke St Kitts funds legislation and no developed local funds industry (see Chapter 15), so expectations should be managed: this is a wrapper, not an ecosystem.

18.10The comparative choice runs in two directions. Clients who want member-managed flexibility with charging-order asset protection choose the Nevis LLC (see Chapter 7). Those who want orthodox fund economics historically defaulted to the St Kitts LP. Since 1 February 2026 the Nevis ordinance offers an alternative with mandatory separate legal personality and Nevis-style protective features (see Chapter 10). The new regime is only months old, untested in the courts, with unsettled tax classification, while Cap 21.12 is the settled, three-decade statute, and existing St Kitts partnerships are unaffected by the Nevis enactment. Cross-island combinations also work and are seen in practice: a Nevis LLC as general partner of a St Kitts exempt limited partnership pairs full limited liability at the management level with the partnership’s transparent economics.

In practice. The recurring pitfall is treating the partnership as a company: it is not a separate legal person, so title, accounts and contracts sit with the general partner. Put a corporate general partner (commonly a Nevis LLC) in place before anything is acquired. Settle the exempt-status analysis at the outset. The s 62(2) carve-outs are generous, but a single resident-facing dealing outside them puts the exemption in question. Finally, record the reasoning for choosing Cap 21.12 over the new Nevis ordinance or vice versa. In 2026, the older Act’s certainty is often worth more than the newer ordinance’s features.

19. Fiduciary and Corporate Services

19.1Every St Kitts structure described in this Part (company, trust, foundation, limited partnership, captive) reaches the register through a licensed intermediary, so the licensing of trust companies and corporate-service providers is where the St Kitts offshore sector becomes practical. Two features define the landscape in 2026. First, the market is genuinely small: two licensed trust companies and roughly thirty corporate-business providers serve the whole island, while Nevis hosts the majority of the Federation’s trust-and-company-service activity, 52 per cent of TCSP-registered entities at the 2021 National Risk Assessment count, through its separately licensed registered agents (see Chapter 13). Second, the sector’s centre of gravity shifted permanently when the St Kitts exempt company was abolished, the event that closed the island’s tax-privileged company era and reshaped what these providers actually administer.

19.2This chapter covers the licence regime, supervision by the FSRC’s St Kitts branch, the significant 2026 tightening, and what the end of the exempt company means for structures still on the register.

Licensing under the 2019 Regulations

19.3“Finance business”, trust and corporate services, has been licensable on the St Kitts side since the Financial Services (Regulations) Order 1997. The operative regime is now the Financial Services (Trust and Corporate Business) Regulations 2019 (SRO 3 of 2019), administered by the FSRC St Kitts branch. Authorisation runs in two streams: trust business (acting as trustee or protector) and corporate business (forming and managing companies, foundations and limited partnerships, providing nominee officers, and registered-office and registered-agent services). A foundation’s mandatory secretary must hold a trust or corporate business authorisation (see Chapter 17), and limited partnerships are in practice formed through licensees (see Chapter 18). The licence is the gateway to everything else.

19.4Applicants must be companies, or individuals who are attorneys-at-law or certified accountants, and must maintain minimum net assets tiered to the authorisation (regulation 6, EC$2.70 = US$1): EC$540,000 (US$200,000) for unrestricted trust business, EC$270,000 (US$100,000) for corporate business and EC$54,000 (US$20,000) for restricted trust business. The fee scale:

Supervision and ongoing obligations

19.5The Financial Services Regulatory Commission is a single federal body under the Financial Services Regulatory Commission Act 2009 (Cap 21.10, in force 26 November 2009), the statutory “ultimate regulatory body for financial services and for anti-money laundering”. It operates through two branches (s 5), one in Basseterre, one in Charlestown, each headed by its own Director. The St Kitts branch administers the St Kitts-side enactments listed in the Act’s First Schedule, including trust and corporate business, while the Nevis branch administers the Nevis ordinances (Chapter 29 sets out the full architecture).

19.6An applicant files a business plan covering services, organisation, staffing and projections, with full due diligence on beneficial owners, directors and senior management, all of whom face fit-and-proper testing. Once licensed, a provider must file audited financial statements within four months of its financial year-end and undergo AML/CFT compliance audits. It must conduct customer due diligence and beneficial-ownership identification with ongoing monitoring under the Anti-Money Laundering Regulations 2011, the Anti-Terrorism (Prevention of Terrorist Financing) Regulations 2011 and the Financial Services (Implementation of Industry Standards) Regulations 2011. It must keep records and submit to risk-based FSRC examinations. The Proceeds of Crime and Asset Recovery Act 2020 (No. 9 of 2020) underpins the whole framework (see Chapter 31).

The 2026 reforms

19.7Supervision tightened materially in 2026, largely in response to the CFATF’s fourth-round mutual evaluation (adopted 2021, published 2022). The Financial Services (Trust and Corporate Business) (Amendment) Regulations (SRO 15 of 2026, gazetted 22 June 2026, though the FSRC’s website mislabels the instrument “SRO 15 of 2025”) add a “beneficial owner or controller” definition and extend fit-and-proper testing to beneficial owners, shareholders and controllers. A new regulation 5A mandates due diligence on non-national and non-resident principals at the applicant’s cost. Renewal and refusal decisions are now conditioned on the licensee’s record of compliance with the proceeds-of-crime legislation, with thirty days’ reasoned notice. A new supervision Part codifies examination, inspection and investigation powers. Penalties run to EC$10,000 for non-compliance, with obstruction fines up to EC$100,000 for individuals and EC$250,000 for corporates. The FSRC must now publish its list of authorised persons.

19.8In parallel, the Financial Services Regulatory Commission (Amendment) Act 2026 (No. 5 of 2026, assented 18 June 2026) gives the Commission a direct administrative-penalty power, exercisable without first exhausting other measures, and broadens “regulated business” to cover relevant business under the proceeds-of-crime legislation, with the machinery in the FSRC (Administrative Penalties) Regulations (SRO 14 of 2026). An earlier amendment, Act No. 25 of 2024 (assented 20 November 2024), reduced the Commission’s meeting frequency from nine to five per year, governance housekeeping rather than substance. Providers touching digital assets should also note the Virtual Asset Act 2020, as amended in 2024 for FATF alignment, under which virtual-asset service providers register through the FSRC (see Chapter 16). The practical message for clients is uniform: onboarding through a St Kitts licensee is materially heavier in 2026 than it was even two years ago.

The end of the exempt-company era

19.9For two decades the flagship St Kitts offshore product was the exempt private company under the Companies Act 1996 (Cap 21.03): exempt from tax under s 225 where business was carried on exclusively with non-residents, with bearer-share capacity (s 51) and carve-outs from register inspection (s 45). Following review of the regime by the OECD Forum on Harmful Tax Practices and the EU Code of Conduct Group, it was dismantled in three steps. The Companies (Amendment) Act 2018 (No. 14 of 2018, adopted 27 December 2018) closed the regime to new entrants with effect from 1 January 2019, with parallel Nevis ordinances doing the same for NBCs and LLCs. Existing exempt companies were grandfathered only to 20 June 2021, the St Kitts Act’s own, slightly earlier cut-off. The parallel Nevis ordinances used 30 June 2021. In the interim, the Companies (Amendment) Act 2019 (No. 7 of 2019, assented 9 September 2019) added s 224A, barring grandfathered companies from acquiring new assets, taking on activities outside their objects, or acquiring or benefiting from intellectual-property assets, and added s 72A, requiring notification of director and shareholder changes within 21 days on pain of an EC$250-per-day penalty. The Companies (Amendment) Act 2021 (No. 13 of 2021, assented 26 March 2021) then completed the dismantling: it repealed the bearer-share provisions (ss 51–52) and the tax-exemption sections (ss 225–226) outright, required every remaining exempt company to convert to an ordinary or non-resident “international” company by 20 June 2021, and directed the Registrar to strike off, without possibility of restoration, any that failed to do so.

19.10The position in 2026 is therefore clean: there is no tax-privileged St Kitts company, and none can be formed. All companies incorporate under the ordinary Companies Act, private or public, limited by shares or by guarantee. The segregated-portfolio-company Part (Part XXVI) was itself repealed by the 2021 amendment. They fall under the Income Tax Act (Cap 20.22): 33 per cent corporation tax for resident companies (residence following central management and control) on worldwide income, source-basis taxation for non-residents, and 15 per cent withholding on payments to non-residents (see Chapter 24). Since 26 August 2020, a Federation-incorporated company claiming non-resident status must file the simplified CIT 101 return annually (CIT 100 where there is a local permanent establishment). The exempt-company provisions were formally repealed by the 2021 amendment. The versions still printed in the 2020 Revised Edition, which closed before that Act, are of historical interest only.

19.11For legacy structures the consequences are concrete. An exempt company that converted in 2021 continues today as an ordinary or international company, fully taxable and filing under the Income Tax Act. One that failed to convert was struck from the register after 20 June 2021 and cannot be restored. Where a supposed St Kitts exempt company surfaces in a client group, the first question is which side of that line it fell on, and, for a struck-off company, what has become of any assets it still held. The analysis should be run now, not when a bank or counterparty asks.

A small market, candidly

19.12The licensed population tells its own story: two trust companies, National Bank Trust Company (St Kitts-Nevis-Anguilla) Limited and Marvason Trust Limited (formerly CaribTrust), both in Basseterre, alongside roughly thirty registered corporate-business providers, mostly law and accounting practices, and four escrow agents. Dual-island practices are common, but the licences do not travel: a Nevis registered-agent licence does not authorise St Kitts trust or corporate business, and vice versa, so firms serving both markets hold both.

In practice. Choose the provider before the structure: with two trust licensees and some thirty corporate providers, capacity, not law, is the St Kitts constraint, and the provider must be licensed on the correct island for the work. Since the 2026 amendments, arrive with beneficial owners’ due-diligence files ready: fit-and-proper now reaches owners and controllers, and the US$8,000 per-head diligence cost for non-national principals belongs in the budget from day one. And if a legacy exempt company surfaces anywhere in a client group, treat it as a live tax-and-penalty problem rather than a dormant asset.

20. Captive and International Insurance

20.1St Kitts has operated a purpose-built captive insurance regime since 2006, offering the conventional taxonomy (pure, association and group captives, each with a statutory small-captive tier) that risk managers from the United States and elsewhere will recognise. The necessary starting point, however, is scale: at the most recent published count (the 2021 National Risk Assessment and CFATF evaluation data), 32 international insurance companies were licensed on the St Kitts side against 228 in Nevis, supported by two St Kitts insurance managers against seventeen in Nevis. The regime is genuine and workable, but it is the Federation’s smaller insurance book, and any feasibility study should treat the Nevis alternative (see Chapter 11) as the default comparator.

20.2This chapter sets out the licence classes, capital and fees, the application and ongoing requirements, the tax analysis, which carries the sector’s one significant open question, and where a St Kitts captive genuinely fits.

The legal framework

20.3The governing statute is the Captive Insurance Companies Act 2006 (Cap 21.20), Act 12 of 2006, in force 7 September 2006, amended by Acts 1 and 36 of 2011 and by Act 13 of 2018, which recast the insurance-manager qualification standards. It is administered by the Registrar of Captive Insurance Companies (s 4(1)) within the FSRC St Kitts branch. Two supporting instruments matter: the Insurance Act 2009 (Cap 21.11), whose solvency provisions are cross-referenced, and the Exempt Insurance Companies Act (Cap 21.08), the potential tax-exemption gateway. A captive underwrites the risks of its owners and affiliates within class-based limits on unaffiliated business (s 8(1)). Personal motor and homeowner’s cover cannot be written.

Licence classes, capital and fees

20.4Minimum unimpaired capital and surplus is set by class (ss 3 and 15). The peg (EC$2.70 = US$1) applies throughout:

20.5A common practitioner citation of “US$200,000” for a St Kitts pure captive understates the statutory schedule, which converts to approximately US$225,000. Work from the EC$ figures.

20.6Fees are modest by international standards: the application fee is EC$1,620 (US$600), reduced to EC$540 (US$200) for small captives, and the annual licence and renewal fee is EC$8,100 (US$3,000), reduced to EC$2,160 (US$800) for small captives.

Licensing and ongoing requirements

20.7An application (s 8) comprises the organisational documents, a sworn statement of financial condition, a three-year business plan setting out coverages, deductibles and limits, notarised due diligence on beneficial owners and directors, and evidence of capital, management expertise and loss-prevention programmes. Simplified forms apply to small captives (s 9), and directors and officers face fit-and-proper testing (s 10).

20.8Once licensed, the captive must maintain the solvency margin prescribed by s 54 of the Insurance Act, holding assets within prescribed liquid-asset classes (s 16(2)). It must appoint and retain a qualified insurance manager (s 19), since the 2018 amendment, a licensed firm employing professionally credentialled staff, such as fellows or associates of the Chartered Insurance Institute or holders of equivalent qualifications recognised by the FSRC. It must file annual financial statements prepared to GAAP by 1 March each year, with actuarial certification for long-term business from which small captives are exempt (s 20), and remain within the suspension and revocation grounds of s 22. The insurance-manager requirement deserves early attention: with only two managers licensed on the island, most programmes are in practice administered from Nevis or from abroad, and the manager’s identity and capacity belong in the business plan rather than being left to follow licensing.

Tax treatment

20.9A captive underwriting solely offshore risks may qualify for income-tax exemption under s 33 of the Exempt Insurance Companies Act, which remains listed among the FSRC’s regulated enactments. Whether that exemption survived the 2018–2021 dismantling of the Federation’s ring-fenced tax regimes (see Chapter 19) is the key open question for this chapter: if it lapsed with the exempt-company era, a captive defaults to ordinary Income Tax Act treatment, 33 per cent if resident by central management and control, source-basis if managed abroad. There are no capital-gains or premium taxes, but the 15 per cent withholding tax bears on payments to non-residents from onshore sources (see Chapter 24). A written confirmation of the operative tax analysis from the FSRC and local tax counsel should precede any licence application. For most foreign-parented captives the sharper questions will in any event be home-country ones: controlled-foreign-company rules and the deductibility of premiums paid to the captive.

The sector in 2026, and the Nevis comparison

20.10Cap 21.20 has not been amended since 2018, and no captive-specific modernisation was in progress at the time of writing. The sector nonetheless feels the general 2026 tightening, since the FSRC’s new administrative-penalty powers (Act No. 5 of 2026 and SRO 14 of 2026) and heightened AML/CFT supervision apply to licensees across the board (see Chapter 19).

20.11The comparison with Nevis is straightforward on the numbers. The Nevis International Insurance Ordinance 2004 (Cap 7.07 (N)) licenses six classes with lower entry capital: US$185,000 for general or long-term insurers, US$75,000 for reinsurers, US$10,000 to US$50,000 for captives depending on ownership, and US$10,000 for the allied annuity and reinsurance classes, the niche in which Nevis has built real volume, with eighteen allied reinsurers at the National Risk Assessment count. Nevis is therefore cheaper for a single-owner captive and hosts the deeper service bench. St Kitts answers with the more conventional pure, association and group taxonomy and its statutory small-captive concessions.

When a St Kitts captive fits

20.12The St Kitts regime suits a parent, typically United States-based, that wants a recognisably orthodox captive statute, class-defined capital, and a small-captive tier with genuinely low entry capital and fees, and that is content to bring its own insurance management. In our experience the sensible pre-engagement step is a direct approach to the FSRC St Kitts branch to confirm three things in writing: the current captive count and the regulator’s appetite for new licences, the operative tax analysis under Cap 21.08, and whether any modernisation of Cap 21.20 is pending. Where entry cost dominates the decision, or the programme needs local management depth, the Nevis regime will usually win the comparison (see Chapter 11), the guide’s consistent theme in this Part.

In practice. Before commissioning a feasibility study, put two questions to the FSRC St Kitts branch in writing: its appetite for new captive licences, and its operative analysis of the Cap 21.08 tax exemption. The answer determines whether the vehicle is tax-neutral or a 33 per cent taxpayer. Line up the insurance manager at the same time. With only two licensed on the island, most programmes are run from Nevis or abroad, and the manager belongs in the s 8 business plan, not the post-licensing to-do list. If entry capital is the deciding factor, run the Nevis comparison first. For a single-owner captive it is usually the cheaper route.