Tax Considerations in CARICOM

Purpose

Summarize common tax concepts and decision points for operating in CARICOM member states. Emphasizes registration, filings, cross-border impacts, and compliance planning. Intended for startups and SMBs; not a substitute for local tax advice.

Context & Assumptions

Tax systems differ by country; rates, thresholds, and filing cadences change over time.
Common elements: corporate income tax, VAT/GST, payroll taxes, withholding on cross-border payments.
Double taxation relief depends on treaties and domestic rules; documentation is required to access relief.

Core Guidance

Tax Identifiers & Registrations

Tax number (TIN/TRN): Obtain after incorporation/registration.
VAT/GST: Register when exceeding local thresholds or if sector rules mandate; confirm filing frequency.
Payroll/withholding: Register as employer before hiring; align with social security where applicable.

Obligations & Filings (Conceptual)

Corporate income tax returns (typically annual) with advance/estimated payments where required.
VAT/GST returns (monthly/quarterly depending on country rules).
Employer filings: payroll taxes, social contributions, withholding statements.
Withholding tax on dividends, interest, royalties, and services per local law and treaty relief.

Cross-Border Considerations

Treaties & withholding: Confirm applicable treaty rates and documentation (residency certificates, forms).
Permanent establishment: Assess whether activities in another member state create taxable presence.
Transfer pricing: Related-party transactions must follow arm’s length principles; documentation may be required.
Indirect tax on services/goods: Determine place-of-supply rules for cross-border services and imports.

Compliance Planning

Build a compliance calendar covering returns, payments, and renewals.
Maintain supporting documentation (invoices, contracts, residency certificates, TP files) for audits.
Align invoicing, systems, and banking with VAT/GST and FX requirements.
Engage local tax advisors for treaty claims, PE assessments, and sector-specific rules.

Common Pitfalls

Late or missing VAT registration after crossing thresholds.
Assuming treaty relief without required residency certificates or forms.
Ignoring payroll when hiring contractors who are treated as employees locally.
Underestimating PE risk from on-the-ground activities in another member state.
Weak recordkeeping leading to denied deductions or VAT credits.

Disclaimer

Informational and educational only. Tax rates, thresholds, filing requirements, treaty terms, and documentation standards vary by country and change over time. Always confirm current rules with the relevant tax authority and engage qualified tax advisors in the specific CARICOM jurisdiction before making tax filings or cross-border payments.