Tax laws Jamaica
Jamaica's tax system encompasses various taxes applicable to individuals and corporations. Here's an overview of the key tax laws:
Personal Income Tax (PIT):
Tax-Free Threshold: As of April 1, 2024, the annual tax-free threshold is JMD 1,700,088 for Jamaican tax-resident individuals.
Tax Rates:
- Up to JMD 1,700,088: 0%
- JMD 1,700,089 to JMD 6,000,000: 25%
- Above JMD 6,000,000: 30%
These rates apply to chargeable income after accounting for the tax-free threshold.
Corporate Income Tax (CIT):
- Standard Rates:
- Unregulated Companies: 25%
- Regulated Companies: 33⅓%
- Building Societies: 30%
- Life Assurance Companies: 25%
These rates vary based on the type of company and its regulatory status.
Value Added Tax (VAT):
- General Consumption Tax (GCT): The standard rate is 15%, applicable to most goods and services.
Withholding Tax (WHT):
Residents:
- Dividends: 15%
- Interest: 0% or 25%, depending on the nature of the payment
- Royalties: 0%
Non-Residents:
- Dividends: 33⅓% (corporate) / 25% (individual)
- Interest: 33⅓% (corporate) / 25% (individual)
- Royalties: 33⅓% (corporate) / 25% (individual)
These rates apply to payments made to residents and non-residents, with variations based on the recipient's status.
Transfer Tax:
- Rate: 2% on the transfer of Jamaican real estate and securities.
- Estate Transfers: A 1.5% transfer tax applies on death for estates valued over JMD 10 million.
Notably, there is no capital gains tax regime in Jamaica; however, transfer taxes apply to certain transactions.
Recent Developments:
Income Tax Threshold Increase: Effective April 1, 2024, the personal income tax threshold increased to JMD 1,700,088 from JMD 1,500,096, providing tax relief to individuals.
Reverse Income Tax Credit (RITC): The government introduced a tax credit for individuals earning less than JMD 3 million per annum, aiming to support lower-income earners.
These measures reflect Jamaica's ongoing efforts to reform its tax system, promote equity, and stimulate economic growth.
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