28 July 2022
Understanding Taxes and Tax Residency In St Kitts & Nevis
Individuals looking to move their tax residency status to St Kitts & Nevis, can qualify by residing within St Kitts & Nevis for a minimum of 183 days within the fiscal year. However, St Kitts & Nevis offers a citizenship-by-investment (CBI) program where individuals and families can obtain citizenship (and a passport) in return for a donation or investment in an approved real estate project within the country.
Tax residency is offered immediately on obtaining citizenship through the St Kitts & Nevis CBI program with no requirement for physical presence to obtain citizenship or the tax residency status. While tax residency is conferred immediately, it should be noted that this does not exempt those from their tax obligations in their home countries and it is important to create a tax planning strategy to with local and international tax experts to make the most of the tax benefits in one of the oldest tax havens in the Caribbean.
The tax identification number (TIN) is not required to prove official status of tax residency in St Kitts & Nevis, however other countries may require an individual to show proof of tax residency to their local tax authorities. The TIN can be requested from the St Kitts & Nevis Inland Revenue Department with a local St Kitts driver’s license, which is currently required to be requested in person.
Individuals, resident and non-residents, are not required to file any annual tax returns.
The currency used in St Kitts & Nevis is the Easter Caribbean Dollar (XCD).
Taxes in St Kitts & Nevis
Income, Inheritance, Wealth and Gifts
St Kitts & Nevis does not impose any taxes on income, inheritance, wealth or gifts for residents or non-residents.
Employees are subject to 5% social security contributions whereas employers are subject to 6% of the employee’s wage.
Capital gains are not subject to any tax if the asset is sold after 1 year of acquisition. If the asset is sold within 1 year of acquisition, it will be subject to 20% capital gains tax.
Withholding tax of 15% is imposed on payments to non-residents including dividends, interest and royalties for both individuals and corporations. St Kitts does not impose any withholding taxes on payments to citizens or residents.
Non-resident companies are tax exempt on all foreign sources income, however will be subject to income taxes on locally sourced income. Withholding tax of 15% is imposed on payments to non-residents including dividends, interest and royalties for both individuals and corporations
Resident companies are subject to a corporate tax of 33%.
All companies registered within St Kitts & Nevis are required to file income tax returns, even if the corporation did not conduct any transactions during the year.
The standard VAT is 17% with a reduced VAT of 10% for hotel and restaurants and 0% for certain food items such as milk and bread.
St Kitts & Nevis imposes a stamp duty of 6-10% depending on the location of the property.
*Foreigners are required to obtain a license to own land at 10% of the property value. CBI applicants are exempt of this fee.
St Kitts & Nevis imposes property tax based on a simple formula of: property value times tax rate. For residential properties, there is an exemption of up to $80 000 on the taxable value on buildings.
CRS requires financial institutions to identify customer tax residencies and report financial accounts held directly or indirectly by foreign tax residents to local tax authorities. It also requires tax authorities (in participating countries) to exchange this information. St Kitts & Nevis currently holds a bilateral agreement with: Aruba, Australia, Belgium, Canada, Denmark, Faroe Islands, Finland, France, Greenland, Iceland, Liechtenstein, Netherlands, Netherlands, Antilles, New Zealand, Norway, Portugal, Sweden, United Kingdom. Please refer to OECD´S website for more information on CRS reporting and TIEAS.
Individuals with accounts and other assets in Financial Institutions operating within St. Kitts and Nevis, may have their account and asset information reported to the United States Internal Revenue Service (IRS) where that individual meets the criteria of a U.S. Person, and where the account meets the criteria as a Reportable Account under FATCA.
Double Taxation Treaties
St Kitts & Nevis has signed double taxation with other CARICOM member countries, Canada, Denmark, Monaco, New Zealand, Norway, San Marino, Sweden, Switzerland, UK and USA.
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