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Withholding Tax

Generally, the withholding tax on income under the Barbados Income Tax Act is 15%.

For payments from Barbados by other companies, the following treaty withholding rates apply:

  • Dividends 0-15%
  • Interest 5-15%
  • Royalties 5-15%
  • Management Fees 0-15%

For non-treaty countries, the withholding rate is 15%.

Interest on bonds, debentures or stock of the Government of Barbados, beneficially owned by a non-resident person is exempt from withholding tax.

Obligations of companies in respect of Directors

In order for a resident Director to satisfy his tax obligation, a company is required to withhold the income tax at source (and pay it into the Authority).

It is worth noting that the now-replaced International Business legislation once provided for exceptions to the obligations to withhold the income tax at source from non-residents depending on the provisions in the enabling legislation.