The differences in, and suitability of, various types of business structure are highly technical and are best discussed with a qualified Cayman Islands attorney.
Due to nationality requirements and the rules governing the grant of a T&B Licence, in practice, only a Caymanian will be able to operate a business as a sole trader if they are competing in the domestic market. A sole trader is able to start their business offering services or goods in return for payment, with very few formalities depending on the type of business.
Typically, small owner-operated businesses with few liabilities, might consider operating as a sole trader (often using a ‘trading as’ title such as Fred Smith (t.a. Fred’s Fantastic Fences). There are few formalities for formation and few annual fees.
The sole trader can employ people to work in the business, but is personally responsible for all the liabilities of the business (e.g. rent, T&B Licence fees, utilities, salaries, health insurance, pension contributions and other statutory benefits for employees) and is also the person who receives all the profits. As indicated previously however, a foreign national doing business internationally from within the Cayman Islands will generally only be able to obtain a licence and operate in Cayman if they first incorporate a suitable Cayman Islands company and obtain the relevant licences for that entity. There will be no requirement for such an entity to have any Caymanian participation.
If you need help and support to start a small or micro sole trader business, contact the Cayman Islands Centre for Business Development (CICBD).
