Every individual who derives his income from Trinidad and Tobago or who is a resident or ordinarily resident or domiciled in Trinidad and Tobago is taxed. On the income even though he has not remitted it to Trinidad and Tobago or transferred the’some of it’ to Trinidad and Tobago. Where necessary, it uses provisions of the existing double taxation treaties to determine that a non-resident individual is taxed based on the income sources in Trinidad and Tobago.
Personal income tax rates
The tax on income for those persons with chargeable income below 1,000,000 TTD is 25%. Where the chargeable income is more than TTD 1 million then the rate of tax that is applicable is thirty percent.
Business levy
Referring to the business levy adopted earlier it can be presented in the form 0. The following presentation expresses the business levy as 0. 6% is chargeable on the sole trader and the self-employed persons for the amount earned or received in the year over TTD 360000. The second of them is where, for each year of assessment, the liability for the business levy is more than the said person’s income tax. However, it is not in effect if the subject income is income tax exempted and the payment therefore shall not be demanded within the first three years of doing the business activity.
Tax Rates
Income taxes are progressive in Trinidad and Tobago with every next band having a higher rate of tax. Also, there is a personal allowance for lessening the taxable income.
Other Taxes
Value Added Tax (VAT): VAT is charged on virtually all the products that are sold in the economy just like the sales tax.
Property Tax: Property tax is done on an annual basis by the owners of the property in proportion to the value assigned to the said property.
Withholding Tax: A portion of the income is taxed at source for instance through withholding tax on income for instance dividend income and income from interest.
Tax Treaties
As for taxation agreements Trinidad and Tobago has signed with the countries including the United States and United Kingdom. These treaties can also be used especially in avoiding cases of double taxation.
Employment expenses
There are no blind deductions or set-off deductions allowed to an employed person while computing the taxable income. This now means that such an individual may only deduct the actual travel expense that is wholly, exclusively and necessarily incurred in the performance of the individual’s employment duties.
Personal allowances
Exemption allowance to the resident taxpayer entitles the latter to a deduction of TTD 84,000. It is also payable to any other person who is not an ordinarily resident of Trinidad and Tobago but who has a pension derived from sources in Trinidad and Tobago. The value of the personal relief will be TTD 90,000 from the financial year starting from 2023.
Business deductions
Any amounts exclusively used to earn the trade, business, profession or vocation income of the self-employed person will be admissible.
Marketing expenses of the professionals involved in the construction field or the persons involved in agriculture for the marketing of existing services or market development for export services. Or locally manufactured products are allowed at 150% of the actual expenditure incurred.
Individual: Other tax credits and incentives
Subscribing for shares in a venture capital company attracts a tax credit where the credit is given at the marginal rate of tax for the amount paid for the shares.
As it can be seen there are no other credits that a resident taxpayer can claim.
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