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- The exempted company has shares, directors and articles of association. The LLC has members, an LLC agreement and either member or manager management, with duties set mainly by contract.
- Government fees: an exempted company costs CI$700 to register and CI$1,025 a year from 2027 in the lowest capital band; an LLC costs CI$900 to register and CI$1,200 a year from 2027, whatever its size.
- Both need a licensed registered office, file an annual return each January, and are covered by economic substance and beneficial ownership rules. An exempted company can convert into an LLC later.
Use a Cayman exempted company when you want a share-based company that banks, investors and lawyers already know, and a Cayman LLC when you want ownership and management set by a flexible contract between members, with duties you can shape yourself. Both are registered with the General Registry, both need a licensed registered office, and both file an annual return each January. In government fees, an exempted company in the lowest capital band is cheaper (CI$700 to register and CI$1,025 a year from 2027) than an LLC (CI$900 and CI$1,200), but an LLC's fees stay flat however large it is.
The LLC arrived with the Limited Liability Companies Act in 2016; the exempted company is much older. Figures are in Cayman Islands dollars (CI$; US$1 = CI$0.82 at the General Registry's rate) and were checked on 31 October 2026.
Exempted company or LLC: the short answer
| Exempted company | LLC | |
|---|---|---|
| Law | Companies Act | Limited Liability Companies Act |
| Owners | Shareholders (one or more) | Members (at least one at all times) |
| Constitution | Memorandum and articles of association | Registration statement and LLC agreement |
| Management | Board of directors | Members by majority, unless the LLC agreement appoints managers |
| Duties | Directors' duties apply under company law and the general law | Managers owe only a duty of good faith unless the LLC agreement expands or restricts it; members owe none unless the agreement says so |
| Capital | Authorised share capital, which sets the fee band | No share capital; members make contributions |
| Registration fee | CI$700 to CI$2,568, by capital band | CI$900, flat |
| Annual fee from 1 Jan 2027 | CI$1,025 to CI$2,893, by capital band | CI$1,200, flat |
| Annual return | January; struck off after one month's notice if not filed | January; struck off after six months' notice if not filed |
| Tax undertaking | Available under the Tax Concessions Act | Up to 50 years under the LLC Act |
| Economic substance and beneficial ownership | Both apply | Both apply |
How each one is owned and run
Exempted company. One or more subscribers sign a memorandum of association, which sets out the name, registered office, objects and authorised share capital, and adopt articles of association. A subscriber also signs a declaration that the company will operate mainly outside the Islands. Ownership is by shares, which can only be transferred through the company's register. A board of directors runs the company. An exempted company does not have to hold an annual general meeting. Shareholders, directors, share classes and resolutions work much as in other common-law jurisdictions, so outside investors and lenders find it easy to review.
LLC. An LLC is formed by filing a registration statement and paying the fee. It must have at least one member at all times. The members' rights are set out in an LLC agreement, which can be signed before, at or after registration. Unless the agreement says otherwise, the members manage the LLC by majority in number. The agreement can instead appoint one or more managers, or a board, to run it. Members hold LLC interests rather than shares, and those interests can only be transferred as the LLC agreement allows.
The biggest legal difference is duties. Under section 26 of the LLC Act, a manager owes no duty, fiduciary or otherwise, other than a duty to act in good faith, unless the LLC agreement expands or restricts it. A member owes no duty to the LLC or the other members unless the agreement says so, and can vote in its own interests. The LLC Act spells out this freedom to shape duties by contract, and it is the main reason to choose an LLC, and also the main reason to get the LLC agreement drafted properly: the agreement does the work that company law does for an exempted company.
Accounts. Both must keep proper books of account that give a true and fair view. An LLC must also keep a record of each member's contributions and distributions, updated within 21 days of any change.
Government fees compared for 2026 and 2027
The fees below are the General Registry's. The 2027 figures come from the Companies (Amendment of Schedule 5) (No. 2) Order, 2026 and the Registry's notice of 9 September 2026.
| Fee | Exempted company (CI$) | LLC (CI$) |
|---|---|---|
| Registration, capital up to CI$42,000 | 700 (about US$854) | 900 flat (about US$1,098) |
| Registration, CI$42,001 to CI$820,000 | 1,000 | |
| Registration, CI$820,001 to CI$1,640,000 | 1,984 | |
| Registration, over CI$1,640,000 | 2,568 | |
| Annual fee 2026, lowest band | 925 | 1,100 |
| Annual fee from 1 Jan 2027, lowest band | 1,025 (about US$1,250) | 1,200 (about US$1,463) |
| Annual fee from 1 Jan 2027, CI$42,001 to CI$820,000 | 1,325 | 1,200 |
| Express registration | 500 extra | 500 extra |
| Certificate of good standing | 150 | 150 |
For a simple holding vehicle with authorised capital up to CI$42,000 (about US$51,220), the exempted company is CI$175 a year cheaper in government fees from 2027. Once an exempted company needs authorised capital above CI$42,000, the LLC becomes the cheaper of the two, and the gap widens in the higher bands. Registered office and other provider fees come on top for both. Our guide to what a Cayman exempted company costs lists every exempted company fee.
Annual filings, substance and beneficial ownership
Annual return. Both file in January. An exempted company declares that its memorandum has not changed, states the nature of its business and confirms it has operated mainly outside the Islands. An LLC states the nature of its business and certifies that it has complied with the LLC Act during the year. Both pay their annual fee with the return, and both face the same late penalties: 33.33% of the fee from 1 April, 66.67% from 1 July and 100% from 1 October. The difference is the warning period before strike-off: one month's notice for an exempted company, six months' for an LLC. See the Cayman annual return guide.
Registered office. Both must use a licensed provider. For an exempted company, the Companies Act requires the registered office to be at the address of a company management provider licensed by the Cayman Islands Monetary Authority. For an LLC, the provider must hold a licence under the banking, companies management or mutual funds laws.
Trading in Cayman. Neither is meant to trade locally. An exempted company may not carry on business in the Islands except in furtherance of its business outside them, and an LLC declares on registration that it will not do business with the public in the Islands beyond what its business outside requires.
Economic substance. Both are "relevant entities" under the economic substance law. Each notifies the Department for International Tax Cooperation every year and, if it carries on a relevant activity such as holding company or financing business, must meet the test and file a return within 12 months of its year-end. See Cayman economic substance.
Beneficial ownership. Both are legal persons under the Beneficial Ownership Transparency Act. The registered office keeps the register of anyone owning or controlling 25% or more, and changes must reach it within 30 days. See Cayman beneficial ownership.
What the Registry shows about each
Neither vehicle has a public shareholder or member register in the way a UK company does, but some information can be inspected at the General Registry for a fee.
- Exempted company: the Registrar keeps a list of current directors that anyone can inspect for CI$50. The register of members can be kept at any place inside or outside the Islands and, for an exempted company without a local licence, is not open to public inspection.
- LLC: the Registrar keeps a list of current managers that anyone can inspect for a fee. The registration statement, which includes the names and addresses of the initial members, the nature of the business and the financial year-end, can also be inspected for CI$50. If privacy of the original members matters, discuss this with your adviser before filing.
Beneficial ownership information for both sits on the government's restricted search platform, not on a public register.
Which to choose for holding, family and deal structures
Choose an exempted company when:
- outside investors, banks or acquirers will review the structure and expect shares, a board and articles;
- you want a vehicle that may later raise equity, issue share classes or list;
- it is a straightforward holding company in the lowest capital band, where it is also the cheaper option;
- you want directors' duties to apply by law, for example in a joint venture where each side appoints directors.
Choose an LLC when:
- the owners want to agree their economics, voting and exits in one contract, as partners would;
- you want management by members or appointed managers with duties limited to good faith, by agreement;
- the structure needs a large capital base, where the LLC's flat fees are cheaper than the higher exempted company bands.
Changing later. An exempted company (other than a segregated portfolio company) can convert into an LLC by special resolution, adopting a registration statement and LLC agreement, with a re-registration fee of CI$900. So the choice is not permanent, although a conversion has legal and tax consequences of its own.
Tax at home matters more than the vehicle. Cayman charges no tax on either. What the owners pay depends on how their home country treats the entity and its income. If any owner is a US taxpayer, ask a US tax adviser how each vehicle would be treated before you choose. For the wider question, see when an offshore company still owes home-country tax, and if Cayman itself is still open, our comparison of Cayman or BVI for a holding company and the BVI cost guide.
How Cosmos helps. Cosmos sets up Cayman exempted companies and LLCs through our licensed Cayman partners, who provide the registered office. We help you compare the two on cost and filings, work with your lawyers on the documents, and then run the January return, economic substance and beneficial ownership deadlines alongside your other group filings. Cosmos is not a law firm or a corporate service provider, and the articles or LLC agreement should be drafted by Cayman counsel. See company formation in the Cayman Islands or book a call.
FAQ
What is the difference between a Cayman exempted company and a Cayman LLC?
An exempted company has shares, directors and articles of association under the Companies Act. An LLC has members, an LLC agreement and either member or manager management under the LLC Act, with duties largely set by the agreement.
Is a Cayman LLC cheaper than an exempted company?
Not in the lowest band. From 2027 an exempted company with capital up to CI$42,000 pays CI$700 to register and CI$1,025 a year, against CI$900 and CI$1,200 for an LLC. Above CI$42,000, the LLC's flat CI$1,200 annual fee is cheaper.
Does a Cayman LLC need a registered office?
Yes. It must keep a registered office in the Islands with a provider licensed under the banking, companies management or mutual funds laws, just as an exempted company needs a licensed registered office.
Do economic substance rules apply to a Cayman LLC?
Yes. An LLC is a relevant entity. It notifies the DITC every year and, if it carries on a relevant activity, must meet the economic substance test and file a return within 12 months of its year-end.
Can I convert a Cayman exempted company into an LLC?
Yes, unless it is a segregated portfolio company. It passes a special resolution adopting a registration statement and LLC agreement and applies to the Registrar, paying a CI$900 re-registration fee.
When is the Cayman LLC annual return due?
In January each year, with the annual fee of CI$1,100 for 2026 and CI$1,200 from 2027. Late payment adds 33.33% to 100% of the fee, and an LLC that does not file can be struck off after six months' notice.
Who can see who owns a Cayman LLC?
The register of members is not public. The registration statement, including the initial members, and the list of managers can be inspected at the Registry for a fee. Beneficial ownership information sits on a restricted government platform.
