Barbados offers an appealing business landscape with relatively low corporate income tax rates and various tax incentives. In addition to corporate income tax, businesses in Barbados should consider other taxes such as VAT, payroll taxes, withholding taxes, property tax, stamp duty, and excise tax. It is advisable to consult with tax professionals and refer to the official website of the Barbados Revenue Authority (BRA) for the most up-to-date information and specific requirements pertaining to business taxes in Barbados.
Corporate Income Tax:
Barbados operates on a worldwide basis for corporate taxation, meaning that both local and foreign-sourced income are subject to taxation. The corporate income tax rate in Barbados is 5.5% for most companies. However, certain entities, such as international business companies, can benefit from a special tax rate of 1%.
Types of Business Taxes in Barbados:
Value Added Tax (VAT): Barbados implemented a VAT system on January 1, 2020. The standard VAT rate is currently set at 17.5%. VAT is levied on most goods and services, with some exemptions and reduced rates for specific categories. Registration for VAT is mandatory for businesses that meet the relevant turnover threshold.
Payroll Taxes: Employers in Barbados are required to contribute to the National Insurance Scheme (NIS) on behalf of their employees. These contributions fund social security benefits such as pensions, sickness benefits, and unemployment benefits. The rates of NIS contributions vary based on the income of the employee.
Withholding Taxes: Barbados imposes withholding taxes on certain types of income paid to non-residents, including dividends, interest, royalties, and management fees. The rates vary depending on the type of income and the existence of applicable tax treaties.
Property Tax: Property tax is levied on the ownership of real estate properties in Barbados. The tax is based on the assessed value of the property and varies depending on factors such as the property type and location.
Stamp Duty: Stamp duty is payable on various transactions, including property transfers, lease agreements, loan agreements, and share transfers. The rates vary depending on the nature of the transaction.
Excise Tax: Excise tax is imposed on specific goods such as alcohol, tobacco, petroleum, and motor vehicles. The rates and bases for excise tax differ depending on the type of goods.
Barbados Revenue Authority (BRA) Website:
For comprehensive information on business taxes, it is advisable to visit the official website of the Barbados Revenue Authority (BRA). The BRA website provides access to tax forms, guidelines, publications, and contact details for inquiries related to tax matters.
Barbados Revenue Authority (BRA) Website: Official Barbados Revenue Authority Website