A Guide to Investing in Trinidad and Tobago (2011) - Ministry of ...

Taxable Sources for Corporation Tax
The following revenues are included: Income from
sources derived in or accruing in Trinidad & Tobago or
elsewhere and whether received in Trinidad & Tobago
or not in respect of gains and profits from farming,
fishing, operation of mines or other natural resources,
trade or business, professions, vocations or management
charges, royalties, rents, interests, discounts,
annual payments, fees, commissions, distributions,
short term capital gains.
Business Levy and Green Fund Levy
The business levy is payable quarterly at the rate of
0.2% of the gross income of the company. Corporation
tax payments are set off against the business levy
liability of the corporation in the following year when
returns are filed. The individual taxpayer is entitled to a
tax credit against his business levy liability for a year of
income of any payment made in respect of his income
tax liability for that year up to a maximum of his business
levy liability.
No liability accrues in respect of gross sales giving
rise to exempt income or gross sales not exceeding
$200,000.00 per annum. Green Fund Levy is payable
quarterly at the rate of 0.1% of the gross revenue. It applies
even if the business is exempt from business levy.
Supplemental Petroleum Tax
Supplemental Petroleum Tax is levied at scales based
on the price of oil.
Expenses Allowed as Deductions Under the
Corporation Tax Act
All expenses wholly and exclusively incurred in the
production of income are allowed except where specifically
disallowed. Major expenses not allowed are
domestic and private expenses, capital expenses and
certain payments to non-residents unless withholding
taxes have been accounted for and paid over to the
Board of Inland Revenue.
Significance of Being Resident
Residents are taxed on income derived from abroad
whether remitted to Trinidad and Tobago or not.
84 A Guide to Investing in Trinidad and Tobago (2011)
Applicable Tax Rates
The tax rate for companies is generally 25% of the
chargeable profits of the company. The rate is 35%
for companies engaged in liquefaction of natural gas,
manufacture of petrochemicals and transmission and
distribution of natural gas and wholesale marketing
and distribution of petroleum products. Petroleum
profits tax is levied at 50%.
Territorial Rules
The corporation is resident where its central management
and control takes place. Control is exercised
where the Board of Directors meets and makes decisions,
unless the board is itself controlled by a third
party. The worldwide income of resident companies
or entities is taxed.
Branch income is taxed as if the branch is a separate
entity. All branch profits, unless re-invested in specific
activities, are deemed to be remitted, and are subject
to withholding taxes.
Withholding Tax Rates
Dividends to individuals: 15%
Dividends to companies: 15% but 10% to a parent
company
Royalties to individuals and to companies: 20%
Interest to individuals, companies and banks: 20%
Some of the existing double taxation treaties provide
rates of up to 30%. In such situations, the domestic
lower statutory, 20% rates, will be applied.