St. Kitts Investment Promotion Agency

Investor's Guide: Taxation

Personal Income Tax
There is no personal income tax in St. Kitts.

Corporate Income Tax
(Income Tax Act – No. 17 of 1966 as amended)

Corporate tax is 35% of net profits. Qualified companies enjoy full exemption from taxes on corporate profits for a period not exceeding 15 years. Corporate tax does not apply to exempt companies or to enterprises that have been granted tax concession.

Value Added Tax

(Value Added Tax Act No 3 of 2010)

VAT or Value Added Tax is a tax on consumption. It is charged on the value of imports and on the value added (mark-up) on goods and services supplied by one business to another or to the final consumer.

The tax is levied on imports, transactions between businesses, transactions between businesses and the final consumer and transactions with the Government.

VAT is not an additional tax, but a replacement for some existing indirect taxes.

The VAT Act replaces the following pieces of legislation:

Consumption Tax Act, Cap.20.02
Hotel Accommodation and Restaurant Tax Act,Cap.20.20
Traders Tax Act,Cap.20.46
Cable TV Tax Act
Self Drive Motor Vehicle(Rentals) (Tax)Act, Cap.20.37
Export Duty Act,Cap.20.12
Telecommunications Tax Act
Parcels Tax Act,Cap.20.30
Gaming Machine Tax Act
Public Entertainment and Lotteries Tax Act,Cap.20.34

The standard rate is 17%. A special rate of 10% is extended to hotels, restaurants and tour operators.

Withholding Tax
(Income Tax Amendment Act No. 14 of 1980)

Individuals and ordinary companies remitting payments to persons outside of St. Kitts must deduct 10% withholding tax from the following:

Profits
Administration, management or head office expenses
Technical services fees
Accounting and audit expenses
Royalties
Non-life insurance premiums
Rent

Withholding tax does not apply to profits of an approved enterprise, which is enjoying benefits under the Fiscal Incentives Act. This tax does not apply to exempt trusts, limited partnerships, companies or foundations.

Alien Landholding Licence
(Alien Landholding Regulation Act – CAP 102 as amended)

An Alien Landholding Licence is required for:

A foreign person purchasing land in St. Kitts
A foreign person desirous of acquiring 1/3 or more of the shares in an ordinary company
A foreign person desirous of becoming a director of an ordinary company

Foreign investors buying land are charged an Alien Landholding fee of 10% of the value of the land being purchased.

A foreign investor desirous of acquiring 1/3 or more of the shares in an ordinary company or becoming a director of an ordinary company is required to pay a fee of EC $250.00 per application.