Brunei's competitive tax system, including a corporate income tax rate of 18.5%, makes it an appealing destination for businesses looking to establish a presence in the region. In addition to corporate income tax, businesses operating in Brunei should also be aware of other taxes such as personal income tax, GST, property tax, withholding tax, stamp duty, and social security contributions. It is advisable to consult with a tax professional or refer to the official Bruneian tax authority website for the most accurate and up-to-date information on tax regulations and requirements.
Corporate Income Tax:
Brunei operates on a territorial tax system, meaning that only income derived from activities within the country is subject to taxation. The corporate income tax rate in Brunei is 18.5% for both resident and non-resident companies engaged in commercial, industrial, or professional activities.
Types of Business Taxes in Brunei:
- Corporate Income Tax: The corporate income tax rate in Brunei is 18.5%. This tax is imposed on the profits generated by businesses within the country.
- Personal Income Tax: While not directly a business tax, it is worth mentioning that Brunei levies personal income tax on individuals residing in the country. The personal income tax rates in Brunei are progressive, with rates ranging from 0% to 35%.
- Goods and Services Tax (GST): Brunei introduced the Goods and Services Tax (GST) on January 1, 2020. The standard GST rate is 5%, applicable to the supply of goods and services in Brunei, with certain exemptions and zero-rated supplies.
- Property Tax: Property tax is imposed on the ownership of real estate properties in Brunei. The tax rate varies depending on the type and value of the property.
- Withholding Tax: Brunei imposes withholding tax on certain types of payments made to non-residents. The rates vary depending on the nature of the payment, such as royalties, interest, technical fees, and dividends.
- Stamp Duty: Stamp duty is levied on certain transactions, including the transfer of immovable property, the execution of certain documents, and the issuance of shares or debentures.
- Social Security Contributions: Employers and employees in Brunei are required to contribute to the Social Security Scheme. Contributions are based on a percentage of the employee's wages and are intended to provide social protection benefits.
Bruneian Tax Authority Website:
For detailed and up-to-date information on business taxes in Brunei, it is recommended to visit the official website of the Brunei Inland Revenue Authority (BIR). The website provides comprehensive information, forms, guidelines, and contact details for any tax-related inquiries.
Brunei Inland Revenue Authority (BIR) Website: Official BIR Website