Taxation in the British Virgin Islands

rdf:langString Taxation in the British Virgin Islands

rdf:langString Taxation in the British Virgin Islands is relatively simple by comparative standards; photocopies of all of the tax laws of the British Virgin Islands (BVI) would together amount to about 200 pages of paper. Among the items in the British Virgin Islands that are not subject to taxation: * no capital gains tax, * no gift tax, * no sales tax or value added tax, * no profit tax, * no inheritance tax or estate duty, and * no wealth tax There is technically still income tax assessed in the British Virgin Islands for companies and individuals, but the rate of taxation has been set at zero. That means that individuals are not obliged to filling obligations on their income tax. However, individuals are subject to a payroll deduction made of up to 8% for employees with additional 2% up to 6% of employer's gross salary paid by employers depending on the category the individuals fall into. There are two categories of employers: "Class 1" and "Class 2" The payroll tax applies to all remunerations/salaries over US$10,000 per annum. The currency of British Virgin island is US dollar (USD) which makes it easier to interact with the United States Virgin Islands and creates stability and ability to benefit from their reach and reputation they have while still being one of British Overseas Territories. Furthermore, no foreign exchange controls are present. As far as individual taxation is concerned, there are typically certain penalties for not complying with the law. Regarding corporations, there is a system that can be applied to impose penalties in the case of not complying exists. However, both for individuals as well as corporations an official formal ruling or a formal system for tax purposes does not exist. The absence of most major forms of taxation in the Territory has led to the country being included on most recognised lists of tax havens, although the jurisdiction prefers to style itself as a modern offshore financial centre. The government of British Virgin Islands does not impose any tax on offshore accounts and on top of that, the British Virgin Islands protect the financial security of its clients, account holders. One aspect that the BVI customers can benefit from is the lack of foreign exchange control, resulting in much easier transfers, it also encourages investment and trade while maintaining a protected financial environment and financial privacy. There are a number of forms of taxation and revenue collection in the British Virgin Islands, but the majority of the Government's revenues are obtained directly from annual licence fees for offshore companies incorporated in the jurisdiction.