Corporate Tax Summary

CORPORATION TAX ACT

The Corporation Tax Act has been recently amended to include the following provisions:
BUSINESS LEVY EXEMPTION

Effective from 1 January 2024, manufacturers will be exempt from paying business levy on revenue earned from export sales.

PUBLIC AND PRIVATE SCHOOL CORPORATE SPONSORSHIP

Effective from 1 January 2024, there is a new provision allowing for a 150% tax allowance, up to 500,000 Trinidad and Tobago dollars (TTD), on corporate sponsorship of public and private schools registered with the Ministry of Education. This applies to expenditures incurred by companies for the enhancement and promotion of education.

CYBERSECURITY INVESTMENT TAX ALLOWANCE

From 1 January 2024 to 31 December 2025, companies can benefit from a cybersecurity investment tax allowance of up to TTD 500,000. This allowance applies to expenditures related to investments in cybersecurity software and network security monitoring equipment.

To qualify for the allowance, expenditures must be incurred between 1 January 2024 and 31 December 2025. Companies procuring cybersecurity software and network security monitoring equipment for their own use must obtain certification from iGovTT.

PROPERTY TAXES

The existing waiver of property taxes ended on 31 December 2023 and makes the 2024 taxes under the Property Tax Act due by 30 September 2024.

Any taxes not paid by 30 September 2024 will incur interest at the rate of 15% from 1 October up to the date of payment, and the Board of Inland is required to issue Notices to Non-Payment to applicable landowners informing them of the same and the liability of one’s land to be distrained against or forfeited if the amount due is not paid.

 

PETROLEUM TAXES ACT

The Petroleum Taxes Act was recently amended to provide for the following:
THE IMPOSITION OF TAX APPLICABLE TO SMALL SHALLOW MARINE AREA PRODUCERS (SSMAP)

Under the Finance Act, Small Shallow Marine Area Producers (SSMAP) are subject to varying tax rates based on the weighted average crude oil price:

  1. If the weighted average crude oil price is USD 75.00 per barrel or less, no tax is applicable.

  2. If the weighted average crude oil price ranges from USD 75.01 to USD 90.00 per barrel, the tax rate is 18%.

  3. If the weighted average crude oil price exceeds USD 90.00 per barrel, the tax rate is determined using the following sliding scale formula:

    Supplemental Petroleum Tax (SPT) rate = Base SPT rate + 0.2% * (P - USD 90.00)

    -      Base SPT rate: 18%
    -      P: Weighted average crude oil price in USD

SSMAP is defined in the Finance Act as "a person who carries out petroleum operations in shallow marine areas under a licence, sub-licence, or contract and produces less than 4,000 barrels of crude oil per day."

AN INCREASE IN THE TAX CHARGEABLE FOR MATURE OIL FIELDS OR SMALL MARINE OIL FIELDS

Effective from 1 January 2024, the Supplemental Petroleum Tax (SPT) rate for any mature marine oil field or small marine oil field increases from 20% to 25%.

A Trinidad and Tobago resident corporation is subject to taxation on its worldwide income. In contrast, a non-resident company conducting business in Trinidad and Tobago is taxed solely on income that directly or indirectly originates from activities within Trinidad and Tobago.

The standard corporation tax rate is 30%, although specific classes of companies may have different rates. The current corporation tax rates are as follows:

COMPANY TYPE CORPORATION TAX RATE (%)

Ordinary companies (excluding banks and petrochemical companies)

30

Petrochemical companies / companies licensed to carry on banking business

35

Life insurance companies

0/15/25/30

Petroleum production companies (petroleum profits tax)

50

Petroleum production companies (deep sea)

30

 
BUSINESS LEVY

Corporations in Trinidad and Tobago are subject to a business levy at a rate of 0.6% on gross revenue or receipts, applicable if the levy exceeds their corporation tax liability. Certain exemptions apply, such as for petroleum companies and those with annual turnover below TTD 360,000. The business levy cannot be deducted for corporation tax purposes.

For small and medium enterprise (SME) companies listed on the Trinidad and Tobago Stock Exchange, the business levy rates are structured over the first ten years from listing as follows:

  • 0% levy for the initial five years from listing.

  • 50% of the standard business levy rate for the subsequent five years following the initial period.

  • Thereafter, SME companies are subject to the standard business levy rate.

GREEN FUND LEVY

Companies and partnerships conducting business in Trinidad and Tobago are subject to a green fund levy of 0.3% on their gross income. This levy is paid quarterly and cannot be deducted when computing chargeable income or credited against corporation tax.

For SME companies listed on the Trinidad and Tobago Stock Exchange, the green fund levy is structured over the first ten years from listing as follows:

  • 0% levy for the initial five years from listing.

  • 50% of the standard green fund levy rate for the subsequent five years following the initial period.

  • Thereafter, SME companies are subject to the standard green fund levy rate.

UNEMPLOYMENT LEVY

Only petroleum companies are subject to the unemployment levy, which is calculated at a rate of 5% on taxable profits. There is no allowance for offsetting prior-year losses when calculating this liability.

SUPPLEMENTARY PETROLEUM TAX (SPT)

Supplemental Petroleum Tax (SPT) is calculated on gross income derived from the sale of crude oil, minus royalties and overriding royalties paid on the crude oil sold. This tax is computed separately for land and marine operations and is payable quarterly based on actual gross income each quarter.

 

SPT is deductible when calculating profits subject to petroleum profits tax.

The determination of corporate residence hinges on where the central management and control of a company's business is situated.

PERMANENT ESTABLISHMENT (PE)

A non-resident company is liable to corporation tax on income earned from trading within Trinidad and Tobago. For a company to be considered as engaged in or carrying on trade or business in Trinidad and Tobago, it must maintain an office, place of business, branch, or agency within the country. Although local legislation does not explicitly use the term 'permanent establishment' (PE), this concept is commonly referenced in treaty contexts. Under specific Double Taxation Treaties (DTTs), a non-resident company may be deemed to have a PE in Trinidad and Tobago if:

  • It operates from a fixed place of business in Trinidad and Tobago, from which the company's business activities are conducted either wholly or partially, or

  • It has an agent in Trinidad and Tobago who can legally bind the company.


 

The term 'fixed place of business' generally includes management offices, branches, offices, factories, workshops, installations for natural resource exploration, or buildings and construction projects.

 

Most treaties also specify conditions under which a company will not be considered to have a PE, such as when its activities in Trinidad and Tobago are preparatory or auxiliary in nature.

VALUE-ADDED TAX (VAT)

Value Added Tax (VAT) is applicable to a wide array of goods and services in Trinidad and Tobago. The standard rate for commercial supplies is set at 12.5%.

Certain categories benefit from zero-rated VAT, including basic food items, agricultural supplies, crude oil, natural gas, and exported goods and services. Additionally, hotel accommodation and yachting services provided to non-residents are also zero-rated.

However, several services are exempt from VAT, such as financial services, real estate brokerage, residential rentals, and educational services. Nevertheless, specific financial services are subject to a transaction tax levied at a rate of 15%. Imported inputs used by manufacturers with high capital intensity are exempt from VAT.

Companies engaging in commercial supplies must register for VAT if their turnover exceeds TTD 600,000 within a 12-month period.

CUSTOMS DUTIES  

Customs duties are levied on imports and manufactured goods at rates determined by their classification in the Schedules to the Customs Act. These duties are calculated based on the cost, insurance, and freight (CIF) value of the goods at the time of importation. However, certain goods may qualify for exemptions under specific provisions.

EXCISE TAXES

Certain manufactured goods, including tobacco, alcohol, and petroleum products, are subject to excise taxes imposed at varying rates.

PROPERTY TAXES  

Since the moratorium on property tax payments ended on 30 September 2017, challenges such as incomplete land and property valuation assessment rolls and legal disputes have prevented the collection of the tax after its reinstatement.

Under the Property Taxes Act (PTA) in Trinidad and Tobago, all 'land' is subject to property tax, defined broadly to encompass land covered by water and any buildings, structures, machinery, plant, pipelines, cables, or fixtures affixed to or associated with the land. The process for determining the tax payable is outlined as follows:

The Commissioner of Valuations assesses the Annual Rental Value (ARV) of the property.

If a rental value is unavailable, the capital cost of the property is used and adjusted by applying the following factors:

  • Residential: 3.5%

  • Commercial: 5%

  • Industrial: 5%

  • Plant and machinery not housed in a building: 3%

  • The Board of Inland Revenue (BIR) calculates the Annual Taxable Value (ATV) by deducting appropriate allowances, such as a 10% deduction for voids or loss of rent, from the ARV.

  • The applicable tax rate is then applied to the ATV:

  • Agricultural property: 1%

  • Residential property: 3%

  • Commercial property: 5%

  • Industrial plant and machinery housed in a building: 6%

  • Plant and machinery not housed in a building: 3%

STAMP DUTY  

Stamp duty is imposed on a wide range of instruments, including deeds of conveyance, mortgages, debentures, trust deeds, leases, insurance policies, annuity policies, agreements, and share transfers. Rates vary, ranging from TTD 25 for a trust deed to a maximum of 10% of the market value for property conveyances.

PAYROLL TAXES  

Employers under the pay-as-you-earn (PAYE) system are obligated to withhold income tax from emoluments disbursed to employees. The term 'emoluments' encompasses all forms of compensation such as salary, wages, overtime, bonuses, remuneration, perquisites, lodging, stipends, commissions, director's fees, retiring allowances, and pensions.

SOCIAL SECURITY CONTRIBUTIONS  

There is a social security tax known as National Insurance, which is deducted at source at varying rates. For monthly incomes exceeding TTD 13,600, the maximum weekly rate is TTD 414.30, split between TTD 276.20 paid by the employer and TTD 138.10 paid by the employee.

Additionally, a health surcharge is deducted at source, with a maximum liability of TTD 8.25 for each week worked.

HOTEL ACCOMMODATION TAX  

Hotels are liable to pay a hotel accommodation tax equal to 10% of the value of the accommodation provided.

INSURANCE PREMIUM TAX  

Insurance premiums for general insurance contracts are subject to a 6% tax rate, while premiums for life insurance and reinsurance are exempt from this tax.

Income generated directly or indirectly in or derived from Trinidad and Tobago is subject to taxation for a branch operating there. The tax rates applicable to branch profits align with those for corporate profits. Furthermore, after deduction of corporation tax and reinvestments, branch profits are subject to a withholding tax (WHT) rate of 3%, which can be adjusted based on the terms of relevant Double Taxation Treaties (DTTs).

 
INVENTORY VALUATION

For inventories, the lower of cost or market value is the standard reporting method. Cost may be determined by employing the first in first out (FIFO) or average cost method, with the last in first out (LIFO) and base stock methods typically not accepted for tax purposes.

CAPITAL GAINS

Profits from the disposal of chargeable assets within 12 months of acquisition are taxed at standard corporation tax rates. Capital gains are generally not taxable, except when applying the balancing allowance for depreciable assets. Refer to the Depreciation section in the Deductions category for details on capital gains from the sale of tax-depreciable assets.

DIVIDEND INCOME  

Dividends received by a Trinidad and Tobago company from domestic subsidiaries and other domestic corporations are exempt from corporation tax and business levy, but are liable for the green fund levy.

STOCK DIVIDENDS

A Trinidad and Tobago corporation may distribute common stock dividends (bonus issues) to all resident common stockholders without incurring tax liabilities.

INTEREST INCOME

Interest income earned by a Trinidad and Tobago company is typically subject to taxation.

ROYALTY INCOME  

Royalty income received by a Trinidad and Tobago company is typically subject to taxation.

FOREIGN INCOME

A Trinidad and Tobago resident company is liable for taxation on its income earned worldwide, without any provisions for income deferral within the country's tax laws.

DEPRECIATION  

Tax depreciation rates (wear-and-tear allowances) have been standardised by law. Fixed assets are categorised into one of four classes:



Asset Class Depreciation Rate
Class A: Buildings and improvements 10
Class B: Motor vehicles, furniture and fittings, plant and machinery 30
Class C: Heavy equipment, motor lorries, trucks, and computer equipment 33.3
Class D: Extra heavy equipment, aeroplanes 40

The allowance is computed at the rate applicable to the total expenditure incurred on assets within the class, using a declining-balance method.

Manufacturers are eligible for accelerated tax depreciation in the form of an initial allowance set at 90% of capital expenditure on plant and machinery. This allowance is claimed in the year the asset is first put into use. Companies involved in sugar, petroleum, or petrochemical production, or benefiting from concessions under the Fiscal Incentives Act, qualify for a 20% rate.

Gains from the sale of tax-depreciable assets are taxed as ordinary income (balancing charge) only when the written-down value of assets within a class becomes positive. Until then, proceeds from sales are credited to the specific class, reducing its written-down value. Tax depreciation rules do not necessarily align with book depreciation.

PETROLEUM OPERATIONS  

Companies involved in petroleum production, capital allowances on tangible and intangible exploration and development costs are structured as follows:

Expenditure on tangible and intangible capital exploration from 1 January 2014 to 31 December 2017 qualifies for full deduction (100%) in the year it is incurred.

<p style="text-align: justify;"Until 31 December 2019, expenditures on tangible and intangible exploration and development benefit from an initial allowance of 50%, a second-year allowance of 30%, and a third-year allowance of 20%, calculated based on the incurred expenditure.

Starting 1 January 2020, tangible and intangible exploration and development expenditures are depreciated on a straight-line basis over five years, at a rate of 20% annually.

Companies engaged in exploration within deepwater blocks are eligible for a 140% uplift on capital expenditures related to drilling exploration wells, facilitating enhanced computation of capital allowances.

There are no specific time constraints for claiming these allowances, such as contingent on achieving commercial production. Claims for capital allowances cannot be postponed.

GOODWILL

Expenses related to goodwill are typically not deductible when calculating chargeable income.

START-UP EXPENSES

There are no specific provisions governing start-up expenses; however, they are generally non-deductible.

INTEREST EXPENSES

Companies are generally allowed to deduct interest expenses incurred in the production of income, subject to the provisions detailed in tax legislation and administered by the tax authority. These provisions outline the conditions under which interest payments are deductible, emphasising the necessity for the borrowed funds to be used solely for income-generation purposes and ensuring compliance with withholding tax obligations, particularly for payments to non-residents.



  • Borrowed funds must be used exclusively for income generation purposes, and the interest incurred should relate directly to revenue-generating activities.

  • Interest income received by the company must align with Trinidad and Tobago's tax laws, either as taxable income subject to taxation or as exempt income as per legislative provisions.

  • When making interest payments to non-residents, the company is required to calculate and remit withholding tax (WHT) to the Board of Inland Revenue (BIR) in accordance with applicable tax regulations.

BAD DEBT
  • A deduction for bad debt is permissible if it pertains to revenue expenditure.

  • The bad debt write-off must adhere to accepted accounting standards.

  • The deduction is applicable when the bad debt is specifically identified.

  • The bad debt must be deemed irrecoverable in the tax year when the deduction is claimed.

CHARITABLE CONTRIBUTIONS  

Contributions to approved charities under deeds of covenant are deductible for tax purposes, capped at a maximum of 15% of total income.

FINES AND PENALTIES

Typically, fines and penalties are not deductible expenses.

TAXES  

Generally, taxes or levies other than SPT are not deductible when calculating taxable profit.

OTHER SIGNIFICANT ITEMS  

Local insurance companies can deduct contributions made to 'catastrophe reserve funds' for tax purposes, capped at 20% of their net premium income derived from property insurance business.

NET OPERATING LOSSES  

Businesses can carry forward trading losses indefinitely under current tax laws, allowing them to offset these losses against future taxable profits.

Starting from 1 January 2020, amendments to the Income Tax Act limit companies in the petroleum production sector to utilising up to 75% of their carried forward tax losses against future taxable profits.

Within a group structure, Trinidad and Tobago resident companies can surrender current year losses to another company in the group, albeit with a restriction that limits the reduction of the claimant's tax liability to no more than 25%.

PAYMENTS TO FOREIGN AFFILIATES  

A corporation conducting business in Trinidad and Tobago is eligible to deduct royalties, interest, and service charges paid to foreign affiliates, provided that the appropriate withholding tax (WHT) is deducted and remitted correctly. To qualify for deductibility, interest payments must be linked to funds used for income generation, and the recipient must either be subject to Trinidad and Tobago tax or be specifically exempt under local tax laws.

The deduction for management charges, as defined, paid to non-residents is limited to the lower of the actual management charges or 2% of deductible expenses and outgoings, excluding these charges. Tax depreciation allowances cannot be categorised as expenses in this context. Additionally, WHT may apply to management charges disbursed to non-resident entities.

Group taxation is not provided for under Trinidad and Tobago's tax laws. However, there is a restricted form of group loss relief available, detailed under the Deductions section.



TRANSFER PRICING

Trinidad and Tobago does not have dedicated transfer pricing rules. Nevertheless, the tax legislation grants authority to the tax administration to disregard transactions it deems artificial or fictitious. This broad authority has been applied by tax authorities when assessing related-party transactions involving large multinational corporations to ensure they are conducted at arm’s length.

THIN CAPITALISATION  

Trinidad and Tobago does not have thin capitalization rules.

CONTROLLED FOREIGN COMPANIES (CFCS) Trinidad and Tobago does not have (CFC) rules.

FOREIGN TAX CREDIT

Double taxation is alleviated through the application of foreign tax credits.


TAX HOLIDAYS

FISCAL INCENTIVES ACT, 1979  

Locally incorporated resident corporations classified as approved enterprises may qualify for a tax exemption of up to ten years, depending on their approval category. The exemption can be either partial or complete. With approval, profits may be distributed to shareholders without tax implications, except for certain non-resident shareholders whose relief is limited to the excess tax paid over their liability in their home country. Net losses incurred during the tax holiday period, where total losses exceed total profits, can be carried forward indefinitely for set-off, up to five years after the end of the tax holiday period. After this period, regular loss set-off rules apply. Effective 1 January 2007, no new tax holidays for corporation tax are granted.

APPROVED TOURISM PROJECTS  

Approved tourism development projects, such as hotels, benefit from a tax holiday of up to seven years under the Tourism Development Act 2000. Following the tax exemption period, any losses incurred from operating or renting an approved tourism project can be carried forward and offset against future profits, adhering to standard income tax loss provisions. The designation of an approved tourism project is determined by government declaration.

APPROVED MORTGAGE AND OTHER COMPANIES

An approved company enjoys full exemption from corporation tax on its profits. These exempt profits, upon distribution to shareholders, are also exempt from both corporation tax and income tax. Expenses related to the approved mortgage business continue to be fully deductible.

SPECIAL ECONOMIC ZONES

The previous Free Zone framework has been superseded by a new Special Economic Zone regime. Advantages within designated Special Economic Zones encompass VAT zero rating for supplied goods and exemption from customs duties on approved imports such as capital goods, spare parts, raw materials, stock in trade, and related items used within the Zone.

Specific types of Zones may additionally qualify for a reduced corporation tax rate and exemption from property tax under the updated Special Economic Zone framework.

INVESTMENT IN TECH START-UP AND NEW-TECH BUSINESS ALLOWANCE  

Expenditure invested in a tech start-up or new-tech business is eligible for tax deduction. Additionally, an allowance equivalent to 150% of the actual expenditure incurred in relation to such investment can be claimed, capped at a maximum of TTD 3 million.

The allowance applies to companies incorporated within three years from 1 January 2020, focusing on delivering digital technology products or services, as defined under the legislation.

ENGAGING IN TECHNOLOGY SOLUTION AND DIGITISATION ALLOWANCE

Expenditure invested in technology solutions and digitization activities qualifies for tax deduction. Additionally, companies can claim an allowance equivalent to 150% of the actual expenditure incurred, capped at a maximum of TTD 3 million.

 

The allowance applies to expenses related to technology solutions, defined as a collection of interconnected software programs or services sold as a bundled package.

CREATING YOUTH EMPLOYMENT IN THE TECHNOLOGY INDUSTRY ALLOWANCE  

Investment in job creation within the technology sector, specifically targeting young individuals, qualifies for tax deduction under current regulations. Companies are entitled to an allowance equivalent to 150% of the incurred expenditure towards fostering employment in this field, capped at a maximum of TTD 3 million.

CAPITAL EXPENDITURE BY APPROVED PROPERTY DEVELOPMENT COMPANY ALLOWANCE

To determine the chargeable profits of an approved property development company, deductions are allowable from capital expenditures incurred in constructing buildings intended for commercial or industrial use by the company or its lessees:

  • For buildings where construction began before 31 December 2005 and concluded by 31 December 2007, or began from 1 January 2008 and concluded by 31 December 2014, a deduction of 15% of the capital expenditure is permitted, subject to approval by the BIR.

  • For buildings where construction began on or after 1 January 2015 and concluded by 31 December 2024, a deduction of 20% of the capital expenditure is permitted, subject to approval by the BIR.

RESEARCH AND DEVELOPMENT (R&D) ALLOWANCE  

Companies engaging in research and development (R&D) are eligible to deduct related expenditures from their taxable income. Additionally, they can claim an allowance equal to 40% of the total R&D expenditure, subject to a TTD 3 million ceiling.

CONSERVATION OR PRESERVATION OF PROPERTY OF INTEREST ALLOWANCE  

Costs associated with the conservation or preservation of a designated property, recognized by the Minister for its historical or cultural importance, are eligible for tax deduction. Furthermore, there is an allowance equivalent to 150% of the expenditure incurred, up to a maximum of TTD 1 million.

MANUFACTURING COMPANIES’ INCENTIVE    

During the tax years 2022 and 2023, manufacturing companies investing in projects that enhance information technology, digitisation, or technology development in the manufacturing sector can benefit from a reduced corporation tax rate of 25% on the initial TTD 100,000 expended.

 

This provision does not extend to petrochemical companies, which are defined as entities engaged in the production of chemicals derived from the cracking or processing of petroleum oil, natural gas, or methane.

TECHNOLOGY SOLUTION AND DIGITISATION INCENTIVE  

Technology solution and digitisation companies are eligible for a reduced corporation tax rate, set at 50% of the standard rate, for the first TTD 100,000 of chargeable income during the income year 2022.

 

Similarly, for the income year 2023, these companies are subject to the reduced rate on the first TTD 200,000 of chargeable income.

CARBON CAPTURE AND STORAGE AND ENHANCED OIL RECOVERY ALLOWANCE  

For investments in carbon capture and storage and enhanced oil recovery, an allowance of up to 30% of the incurred expenditure, not exceeding TTD 500,000, can be claimed.

PROMOTIONAL EXPENSES  

Local firms can deduct promotional expenses aimed at expanding existing markets or creating new ones for exporting specified services or locally produced goods. These expenses are deductible at 150% of the actual expenditure incurred. This includes expenditures such as advertising in foreign markets and participation in trade fairs and missions, all eligible for deduction.

SCHOLARSHIP ALLOWANCE

The expenses incurred by companies in offering scholarships to nationals for tertiary education are deductible.

PRODUCTION COMPANY ALLOWANCE  

Companies can claim an allowance equal to 150% of the actual expenses incurred for their own audio, visual, or video productions related to educational purposes, local entertainment, or local culture.

Allowances are available for several activities, each based on actual expenditures incurred, capped at a total of TTD 12 million:

  • Art and culture activities qualify for an allowance.

  • Sporting activities or support for sportsmen are eligible for an allowance.

  • Companies can claim an allowance for their own audio, visual, or video productions.

  • Support provided for promoting the fashion industry is also eligible for an allowance.

CHILD CARE/HOME WORK FACILITY

Companies are eligible to deduct the actual costs associated with establishing facilities for dependents of employees who are minors. This deduction is capped at TTD 500,000 per facility, with an annual aggregate limit of TTD 3 million.

WEAR AND TEAR ALLOWANCES

Expenditure on acquiring plant, machinery, and equipment (excluding installation) for providing compressed natural gas (CNG) kit and cylinder installation services qualifies for a 130% wear and tear allowance.

The acquisition expense for solar heaters, wind turbines, and photovoltaic systems allows for a 150% wear and tear allowance.

TRAINING ALLOWANCE

The training and retraining expenses incurred by a company are eligible for a 150% deduction, incentivizing investments in enhancing employee skills and knowledge.

ALLOWANCE FOR ENGAGEMENT OF ENERGY SERVICE COMPANIES  

When a company engages a certified energy service company to perform an energy audit and install energy-saving systems, the company qualifies for an allowance equivalent to 150% of the incurred expenditure.

Certified energy service companies are eligible for a 75% allowance on the cost incurred in the year of acquisition when they purchase plant and machinery for energy audit purposes.

Withholding tax (WHT) rates vary up to a maximum of 15%, determined by the type of payment, the recipient's status, and the applicability of Double Taxation Treaties (DTTs).

For certain payments, the tax treaty rate may exceed the statutory rate, in which case the lower statutory rate prevails. Adjustments have been made to the rates listed below to accommodate these reductions:

Recipient   Dividends (%) Interest (%)
Portfolio Substantial Holdings

Resident corporations and individuals

0

0

o

Non-resident corporations and individuals:

Non-treaty

(1)

10

10

15

(2)

3/8

3/8

15

Treaty:

Brazil

(1)

10*

10

15

(2)

5/10*

5/10*

15

Canada

(1)

10*

10*

10

(2)

10*

5

10

Caribbean Community (CARICOM) countries

(1)

0

0

15

(2)

0

0

15

China

(1)

10*

10*

10

(2)

10*

5

10

Denmark

(1)

10*

10*

15

(2)

10*

5

15

France

(1)

10*

10*

10

(2)

10*

5

0/10 (4)

Germany

(1)

10*

10*

0/10/15

(2)

10*

5

0/10/15

India

(1)

10*

10*

10

(2)

10*

5

10

Italy

(1)

10*

10*

10

(2)

10*

5

10

Luxembourg

(1)

10*

10*

10

(2)

10*

5

7.5/10

Norway

(1)

10*

10*

15

(2)

10*

5

15

Spain

(1)

10*

10*

8

(2)

10*

0/5/10*

8

Sweden

(1)

10*

10*

15

(2)

10*

10*

0/10/15 (6)

Switzerland

(1)

10*

10*

10

(2)

10*

5

10

United Kingdom

(1)

10*

10*

10

(2)

10*

5

10

United States

(1)

10*

10*

15

(2)

10*

5

0/15/20

Venezuela

(1)

10*

10*

15

(2)

10*

5

15

Recipient Royalties
(8) (9) (10)

Resident corporations, individuals

0

0

0

Non-resident corporations, individuals:

Non-treaty

15

15

15

Treaty:

Brazil

15

15

15

Canada

10

0

15

Caribbean Community (CARICOM) countries

15

15

15

China

10

10

15

Denmark

15

0

15

France

10

0

15

Germany

10

0

15

India

10

10

15

Italy

5

0

15

Luxembourg

10

10

15

Norway

15

0

15

Spain

5

5

15

Sweden

15

0

15

Switzerland

10

0

15

United Kingdom

10

0

15

United States

15

0

15

Venezuela

10

10

15

Notes:

Effective from 1 January 2022, standard withholding tax (WHT) rates will be implemented in cases where the rates specified in Double Taxation Treaties (DTTs) are higher.



  1. Individuals

  2. The lesser rate applies to parent companies.

  3. Companies holding at least 10% of the voting power, excluding investment companies, qualify for the lower withholding tax rate.

  4. Interest payments to residents of France are subject to a 10% withholding tax rate. However, no withholding tax applies if the interest is paid to the French government or any agency or instrumentality thereof.

  5. Interest payments to banks resident in Germany are subject to a 10% withholding tax rate. No withholding tax applies if the interest is paid to specified governmental institutions, while a 15% withholding tax rate applies in all other cases.

  6. Interest payments to banks resident in Sweden are subject to a 10% withholding tax rate. No withholding tax applies if the interest is paid to certain specified governmental institutions, while a 15% withholding tax rate applies in all other cases.

  7. Interest paid to a bank or financial institution in the United States (US) without a Permanent Establishment (PE) in Trinidad and Tobago is subject to a 15% withholding tax rate. No withholding tax applies if the interest is paid to the US government or any agency wholly owned by the US government. A 20% withholding tax rate applies to all other cases.

  8. Patent royalties are subject to a specified withholding tax rate.

  9. Copyright royalties and similar payments are subject to a specified withholding tax rate.

  10. Royalties paid for operations of mines or quarries, or for the extraction or removal of natural resources, are subject to a specified withholding tax rate.

TAXABLE PERIOD

Trinidad and Tobago's tax year follows the conventional calendar year. Companies, however, are assessed based on their accounting periods, which typically do not exceed 12 months, except in the year when the business ceases.

TAX RETURNS

Taxpayers in Trinidad and Tobago must submit their tax returns to the BIR by 30 April after the end of the fiscal period.

An automatic extension of six months is granted, after which a penalty of TTD 1,000 is imposed for every subsequent six-month period or part thereof during which the return remains outstanding.

PAYMENT OF TAX

Corporation tax, business levy, and green fund levy are payable quarterly in advance, with due dates on 31 March, 30 June, 30 September, and 31 December each year. Any remaining tax balance is due on or before 30 April of the following year.

Instalments for corporation tax are calculated based on an estimate of the current year’s liability or the actual chargeable profits from the previous year, whichever amount is higher.

If the estimated liability for the current year is lower, companies have the option to apply to the BIR to reduce their quarterly instalment.

Business levy and green fund levy liabilities are calculated based on the actual receipts for each quarter.

TAX AUDIT PROCESS

The BIR conducts tax audits on companies without a specific timeframe, often selecting firms for various reasons, such as significant refund claims or other anomalies detected.

Upon selecting a company for audit, the BIR typically notifies the company of its intention and requests access to examine the books and records thoroughly.

Following the audit process, the BIR issues an assessment based on its findings and the information reviewed during the audit.

STATUTE OF LIMITATIONS

Companies engaged in business activities within Trinidad and Tobago must maintain accurate and comprehensive accounts and records.

These records must be retained for a minimum period of six years following the completion of the transactions, acts, or operations they pertain to.

Alternatively, records must be kept for at least three years after the filing of the company's tax return, whichever time frame is later in occurrence.

TOPICS OF FOCUS FOR TAX AUTHORITIES  

The tax authorities are currently focused on the following issues:

  • Transfer pricing

  • The tax planning structures of CARICOM

  • Management and other fees paid to non-resident persons

US FOREIGN ACCOUNT TAX COMPLIANCE ACT (FATCA)

The Tax Information Exchange Agreements (United States of America) Act facilitates the execution of agreements between Trinidad and Tobago and the United States of America. Its primary aim is to enable the exchange of information held by either the BIR or financial institutions, pertinent to taxation matters, ensuring transparency and compliance;  supporting global efforts against tax evasion and avoidance.