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Delaware (United States of America)

Introduction

Delaware is located on the east of the United States of America near Baltimore and Washington D.C and is one of the 50 states of the United States, in the Mid-Atlantic or Northeastern region. The geographical position represents a real advantage in terms of export markets due to its close location to the sea and main highways. Delaware is bounded to the north by Pennsylvania; to the east by the Delaware River, Delaware Bay, New Jersey and the Atlantic Ocean; and to the west and south by Maryland.

Delaware is 96 miles (154 km) long and ranges from 9 miles (14 km) to 35 miles (56 km) across, totaling 1,954 square miles (5,060 km2).

Population:

the population of Delaware was 952,065 people on July 1, 2016, a 6.0% increase since the 2010 United States Census.

Language:

As of 2000 91% of Delaware residents age 5 and older speak only English at home; 5% speak Spanish. French is the third most spoken language at 0.7%, followed by Chinese at 0.5% and German at 0.5%.

Political Structure

Delaware's fourth and current constitution, adopted in 1897, provides for executive, judicial and legislative branches. The Democratic Party holds a plurality of registrations in Delaware.

The Delaware General Assembly consists of a House of Representatives with 41 members and a Senate with 21 members. It sits in Dover, the state capital. Significantly, Delaware has one of the few remaining Courts of Chancery in the nation, which has jurisdiction over equity cases, the vast majority of which are corporate disputes, many relating to mergers and acquisitions.

The Court of Chancery and the Delaware Supreme Court have developed a worldwide reputation for rendering concise opinions concerning corporate law which generally grant broad discretion to corporate boards of directors and officers.

Economy

Delaware is the ninth richest state in the United States, with a per capita income of $23,305 and a personal per capita income of $32,810. The state's largest employers are: government; education; banking; chemical and pharmaceutical technology; healthcare; and farming. More than 50% of all U.S. publicly traded companies and 63% of the Fortune 500 are incorporated in Delaware. The state's attractiveness as a corporate haven is largely because of its business-friendly corporation law.

Currency:

United States Dollar (USD)

Exchange Control:

Delaware does not separately impose exchange control or currency regulations.

Financial services industry:

The financial services industry has become a key component of Delaware's economic strength and growth. The state has been home to many banks and financial services companies for years due to tax regulation on interest rates.

Because of its friendly business climate, many companies that you would not associate with Delaware are incorporated in the state. According to the National Law Review, "more than 50 percent of all U.S. publicly traded companies and 63 percent of the Fortune 500 are incorporated in Delaware.

Corporate Law/Act

The corporate laws of Delaware are user-friendly and often adopted by other states as a standard for testing corporate laws. As a result, the corporate laws of Delaware are familiar to many lawyers both in the US and internationally. Delaware has a common law system.

Type of Company/Corporation:

One IBC supply incorporation in Delaware service with the common type Limited Liability Company (LLC) and C - Corp or S - Corp.

More than a million corporations have been incorporated in Delaware and more than 50% of all U.S. publicly-traded companies. Businesses choose Delaware because it provides modern and flexible corporate laws, a respected Court of Chancery and a business friendly State Government.

Business Restriction:

The use of bank, trust, insurance, or reinsurance within the name of the LLC is generally prohibited as limited liability companies in most states are not allowed to engage in a banking or insurance business.

Company Name Restriction:

The name of each limited liability company as set forth in its certificate of formation: Shall contain the words "Limited Liability Company" or the abbreviation "L.L.C." or the designation "LLC";

  • May contain the name of a member or manager;
  • Must be such as to distinguish it upon the records in the office of the Secretary of State from the name on such records of any corporation, partnership, limited partnership, statutory trust or limited liability company reserved, registered, formed or organized under the laws of the State of Delaware or qualified to do business.
  • May contain the following words: "Company," "Association," "Club," "Foundation," "Fund," "Institute," "Society," "Union," "Syndicate," "Limited" or "Trust" (or abbreviations of like import).

Company Information privacy:

No public register of company officers.

Incorporation Procedure

Just 4 simple steps are given to incorporate a Company in Delaware:
  • Step 1: Select basic Resident/Founder nationality information and other additional services which you want (if any).
  • Step 2: Register or login and fill in the company names and director/ shareholder(s) and fill in billing address and special request (if any).
  • Step 3: Choose your payment method (We accept payment by Credit/Debit Card, PayPal or Wire Transfer).
  • Step 4: You will receive soft copies of necessary documents including: Certificate of Incorporation, Business Registration, Memorandum and Articles of Association, etc. Then, your new company in Delaware is ready to do business. You can bring the documents in company kit to open corporate bank account or we can help you with our long experience of Banking support service.
* These documents required to incorporate company in Delaware:
  • Passport of each shareholder/beneficial owner and director;
  • Proof of residential address of each director and shareholder (Must be in English or certified translation version);
  • The proposed company names;
  • The issued share capital and par value of shares.

Compliance

Share Capital:

Delaware does not impose minimum or maximum limits on share capital.

Director:

Only one director required. Directors may be of any nationality.

Shareholder:

Only one shareholder required. Shareholders may be of any nationality and may reside anywhere.

Taxation:

Companies of primary interest to offshore investors are the corporation and the limited liability company (LLC). LLCs are a hybrid of a corporation and a partnership: they share the legal features of a corporation but may choose to be taxed as a corporation, partnership, or trust.

  • Us Federal Taxation: US Limited Liability companies structured for partnership tax treatment with non-resident members and which conduct no business in the US and which have no US-source income are not subject to US federal income tax and are not required to file a US income tax return.
  • State Taxation: US limited liability companies that conduct no business in the recommended states of formation with non-resident members are generally not subject to state income tax and are not required to file a state income tax return.

Finance statement:

There is generally no requirement to file financial statements with the state of formation unless the corporation owns assets within that state or has conducted business within that state.

Local Agent:

Delaware law requires that every business have a Registered Agent in the State of Delaware who may be either an individual resident or business that is authorised to do business in the State of Delaware.

Double Taxation Agreements:

Delaware, as a state-level jurisdiction within the US, has no tax treaties with non-US jurisdictions or double tax treaties with other states in the US. Rather, in the case of individual taxpayers, double taxation is minimised by providing credits against Delaware taxation for taxes paid in other states.

In the case of corporate taxpayers, double taxation is minimised through allocation and apportionment rules related to the income of corporations engaged in multi-state business

License

License Fee & Levy:

The minimum annual franchise tax for a corporation with the standard minimum share capital is USD175, plus an additional USD50 filing fee for the annual franchise tax report. For a LLC, the franchise tax is USD300.

Payment, Company return date Date:

  • All corporations incorporated in the State of Delaware are required to file an Annual Report and to pay a franchise tax. Exempt domestic corporations do not pay a tax but must file an Annual Report. The minimum tax is $175.00 with a maximum tax of $180,000.00. Taxpayers owing $5,000.00 or more pay estimated taxes in quarterly installments with 40% due June 1, 20% due by September 1, 20% due by December 1, and the remainder due March 1. The penalty for not filing a completed Annual Report on or before March 1st is $125. Interest at 1.5% per month is applied to any unpaid tax balance.
  • Limited Liability Companies in the State of Delaware do not file an annual report, they are required to pay an annual tax of $300.00. Taxes for this entities are to be received no later than June 1st of each year. Taxes for these entities are due on or before June 1st of each year. Penalty for non-payment or late payment is $200.00. Interest accrues on the tax and penalty at the rate of 1.5% per month.

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