A few weeks ago, we wrote about setting up your company overseas. Let’s take a closer look at what it’s like to open a company in Guam. Though Guam is technically a part of the United States, there are some crucial differences.
Enlist a registered agent
If you’re opening a business in Guam while living in the U.S. mainland or another country, you must enlist a registered agent with a physical address in Guam. If you live in Guam, you can omit this step.
Pick a business structure
Sole proprietors do not have to register with the Government of Guam. However, sole proprietorship is not recommended due to the exposure of your personal assets to lawsuits and debt issues. It’s best to register as an LLC or a corporation, if applicable.
You should use this opportunity to settle on your corporate bylaws, which are required by law in Guam.
Obtain a business license and file formation paperwork
Any business engaged in the manufacturing or selling of goods or property must obtain a Guam commercial business license. Licenses are non-transferable, expiring at the end of the fiscal year (June 30th), and must be renewed annually. Renewal fees are on a sliding scale, based on gross annual revenue.
File your application with the License Division of the Department of Revenue and Taxation. You can file formation paperwork with the same department.
Open a business bank account in Guam
You’ll need a Guam business bank account to pay employees, purchase supplies/stock and pay rent, utilities, insurance (required if you have employees) and other business expenses.
Learn Guam’s tax laws
Guam operates under its own tax jurisdiction, though the laws are largely the same as the rest of the U.S. Guam also has a business privilege tax called the “Gross Receipts Tax,” a 4% flat tax on gross income, paid monthly to the Department of Revenue and Taxation.
File a Guam Sworn Annual Report
Businesses must file a Sworn Annual Report each year. This includes contact information for managers and executives, the value of shares and other details.
The main advantage to starting a business in Guam, if you are already in business in the U.S., is that the process and requirements are nearly identical. Expanding into Guam is undoubtedly worthwhile if it makes sense for your business.