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1. How does an individual become taxable in your jurisdiction?
There are no forms of income, corporate or capital gains tax in the British Virgin Islands (BVI). However, an individual is taxable in the BVI if they are employed or own BVI property.
2. What, if any, taxes apply to an individual’s income?
Income tax in the BVI is zero-rated and no individual is taxed unless gainfully employed in the BVI. Payroll tax and social security is charged on every self-employed person or employer who carries on business in the BVI. Payroll tax at the rate of 10 per cent is chargeable for small employers and up to 14 per cent of remuneration for large employers. Eight per cent of the total remuneration may be reclaimed from the employee. Employees also pay 4 per cent social security contributions and employers pay 4.5 per cent.
3. What, if any, taxes apply to an individual’s capital gains?
There are no capital gains taxes in the BVI.
4. What, if any, taxes apply if an individual makes lifetime gifts?
There are no gift taxes in the BVI.
5. What, if any, taxes apply to an individual’s transfers on death and to his or her estate following death?
There is no estate duty or inheritance tax payable in the BVI.
6. What, if any, taxes apply to an individual’s real property?
BVI stamp duty is payable on the purchase of real estate in the BVI at different rates depending on whether the purchaser is a foreign national or a BVI national.
Land and house tax together is called ‘property tax’. For land owned by a BVI national or a BVI Company, there is a land tax of US$3 per year on the first acre of part thereof, and US$1 for each subsequent acre or part thereof.
On land owned by a foreign national, there is a tax of US$50 per year for the first half acre or part thereof, and US$150 for the second half acre and an additional US$50 per year for each subsequent half acre.
House tax amounts to 1.5 per cent per annum on the notional annual rental value of the house.
7. What, if any, taxes apply on the import or export, for personal use and enjoyment, of assets other than cash by an individual to your jurisdiction?
Generally, import duty ranges from 5 per cent to 20 per cent of the market value of the imported goods, subject to a number of exemptions.
To continue reading full articles in PDF format:
Getting the Deal Through – Private Client 2018: British Virgin Islands
Reproduced with permission from Law Business Research Ltd. This article was first published in Getting the Deal Through – Private Client 2018, (published in November, 2017; contributing editors: Anthony Thompson and Sara Walter.) For further information please visit www.GettingTheDealThrough.com.