BelizeTax Obligations Detailed

In Belize, employers have various tax obligations, including income tax, business tax, and social security contributions.

Income Tax

• Tax Rate: 25% flat rate on annual income exceeding BZD $26,000. Income below this threshold is tax-exempt.
• Reliefs: Available for charitable donations (up to BZD $250) and education expenses (up to BZD $400 per child, excluding one's own children). Additional reliefs apply to incomes between BZD $26,001 and $29,000, namely BZD $24,600 for income between BZD $26,001 and $27,000 and BZD $22,600 for income between BZD $27,001 and $29,000. A standard personal relief of BZD $19,600 exists for those earning over $29,000.
• Filing Deadline: March 31st of the following year.
• Penalties: 3% of the outstanding tax balance per month for late filing (minimum BZD $10). Interest charges of 1.5% per month apply to unpaid balances after March 31st.
• Refunds: Eligible if tax deducted exceeds tax payable or if income falls below the BZD $26,000 threshold.

Business Tax

• Applicability: Businesses operating in Belize with annual revenue exceeding BZD $75,000.
• Rates: Vary by industry (e.g., 6% for professional services, 3% for rental income, 1.75% for insurance revenue).
• Filing and Payment: Monthly, by the 15th of the following month.

Social Security Contributions

• Employer Contributions: Range from 5% to 8.13% based on employee's weekly earnings.
• Employee Contributions: Range from 1.88% to 4.50% based on weekly earnings.
• Payment: Both employer and employee portions are due by the 14th of each month for the previous month worked.

General Information for Employers

• Tax Year: January 1st to December 31st.
• Currency: Belize Dollar (BZD).
• Tax Identification Number (TIN): Required for payroll and deductions. TIN applications are available from the Belize Tax Service Department.
• Social Security Number: Necessary for employee social security contributions. Applications are handled by the Social Security Board.

This information is current as of February 5, 2025, and may be subject to change. Consulting with a tax professional or referring to official government resources is always recommended for the most up-to-date information.

In Belize, employee income tax is levied at a flat rate of 25% on chargeable income above a certain threshold. Several deductions and reliefs can reduce the taxable income.

Personal Income Tax (PIT)

As of January 1, 2025, individuals employed in Belize are subject to a 25% income tax on earnings above BZD $29,000. Those earning below this threshold are exempt from income tax.

• Tax-Free Threshold: Annual income below BZD $29,000 is not subject to income tax.

• Basic Deduction/Relief: A basic deduction is applied to incomes above BZD $29,000, which varies according to the following income brackets:

  • BZD $29,000.01 - BZD $32,000: A tax credit of BZD $2,250 less 75% of the amount exceeding BZD $29,000 is applied.
  • Above BZD $32,000: A standard deduction of $20,000 applies

• Example (for income above BZD $32,000): An individual earning BZD $40,000 annually would have a chargeable income of BZD $20,000 (BZD $40,000 - BZD $20,000) and a tax liability of BZD $5,000 (BZD $20,000 * 25%).

• Additional Reliefs: Further deductions are available for:

  • Charitable Donations: Up to BZD $250. Original receipts or a letter from the institution are required as proof.
  • Educational Expenses: Up to BZD $400 per child (not your own). Supporting documentation may be required.

Tax Filing and Payment

• TD4 Slip: Employees receive a Statement of Emoluments Paid (TD4 slip) from their employer(s) detailing earnings and deductions.
• Tax Return (BTS203): Employees must file an annual income tax return (Form BTS203) either online or by mail. This form requires the TD4 slip, Social Security card copy, and supporting documents for any claimed deductions. A vendor form with banking information is also needed if a refund is due.
• Deadline: The tax filing deadline is March 31st of the following year, unless an extension is granted by the Commissioner of Income Tax.
• Penalties: Late filing incurs a penalty of 3% of the outstanding tax per month, with a minimum penalty of BZD $10.
• Interest: Unpaid tax after March 31st accrues interest at 1.5% per month until fully paid.
• Refunds: Refunds are issued if the tax paid exceeds the actual tax liability or if tax was withheld from income below the BZD $29,000 threshold.

Employer Responsibilities

Employers in Belize are responsible for withholding income tax from employees' salaries and remitting it to the Belize Tax Service Department (BTSD) monthly, accompanied by Form TD2. Employers are also responsible for issuing TD4 slips to their employees annually. They should register for a Taxpayer Identification Number (TIN) and use the online platform, IRIS Belize, for tax services and transactions.

In Belize, the General Sales Tax (GST) is a consumption tax applied to most goods and services.

GST Rates and Registration

• Standard Rate: 12.5% (As of February 5, 2025). Note that this information is current as of today and may change. This rate applies to most goods and services not specifically exempted or zero-rated.
• Zero-Rated: 0%. Essential goods and services, such as basic food items (rice, beans, corn, flour, sugar, bread, and tortillas) fresh meat and eggs, baby formula, and certain locally produced fruits and vegetables are zero-rated.
• Exempt: These include but are not limited to water, school fees, house rent, insurance, and some medicines. Residential land purchases are also GST-exempt.
• Temporary Zero-Rating: For December 2024, additional goods, including picnic shoulder ham, smoked ham leg, and imported turkey, were temporarily zero-rated. Additionally, a full GST waiver was implemented on December 14, 15, 21, and 22, 2024, for all standard-rated goods with some exceptions.
• Registration Threshold: Businesses with annual revenue of $75,000 BZD or more, or a monthly average of $6,250 BZD or more over a four-month period, must register for GST. Voluntary registration is available. Public entertainment promoters must also be registered.
• Registration Process: Businesses meeting the threshold must register within one month of becoming eligible. An application form (GST 100 for sole proprietors/individuals, GST 101 for partnerships/companies) must be completed and submitted to the nearest GST office.

Filing and Payment

• Filing Frequency: Monthly.
• Deadline: Returns and payments must be submitted by the 15th of the month following the reporting period.
• Method: File returns online through the Integrated Revenue Information System (IRIS Belize). Sales and purchases ledgers must be submitted along with the return.
• Late Filing Penalty: Penalties and interest are charged for late filing and payment.

Amendments for 2025

• The General Sales Tax Act is being amended, effective January 1, 2025. Key changes include extending the time to claim input GST, mandatory authorization of electronic invoices, required provision of tax receipts for taxable supplies, and prohibiting unregistered individuals from stating prices include GST. Fines for late registration will be implemented.

Other Applicable Taxes and Duties

• Import Duties: Range from 0% to 45%, with luxury goods having higher rates.
• Environmental Tax: 3% on most imports, 5% on automobiles, excluding some food and medicine.
• Revenue Replacement Duty: Applied to some imported goods.

This information is for general guidance only and does not constitute professional tax advice. You should consult with a qualified tax advisor for specific guidance regarding your situation. As tax laws and regulations are subject to change, it is highly recommended to stay up-to-date with the latest information from the Belize Tax Services Department.

Belize offers several tax incentives designed to attract investment and stimulate economic growth. These programs cater to various sectors and investor profiles, from large-scale developments to small and medium-sized enterprises (SMEs) and retired individuals.

Fiscal Incentive (FI) Program

This program encourages investment by offering exemptions from import duties, revenue replacement duty, excise duty, and business tax. There are three sub-programs under the FI program: Regular, MSME, and One-Off.

• Regular Program: Offers duty exemptions for up to 25 years to companies granted an Approved Enterprise Order (AEO). Renewals are possible every five years.
• MSME Program: Provides exemptions from import duty, revenue replacement duty, or excise duty on goods for qualifying micro, small and medium enterprises. Businesses must have 51% Belizean ownership and employ no more than 15 persons.
• One-Off Program: Grants ad-hoc exemptions for specific projects.

Export Processing Zone (EPZ) Program

The EPZ program targets export-oriented businesses in manufacturing, processing, assembly, and service sectors. Benefits include various exemptions from import and export duties and taxes.

Commercial Free Zone (CFZ) Program

CFZs offer similar benefits to EPZs but also permit retail and wholesale activities within the zone. Incentives include exemptions from import duties, income tax, capital gains tax, and other taxes for specified periods.

Qualified Retired Person's (QRP) Program

This program provides tax exemptions and other benefits to individuals over 45 who meet specific criteria. Benefits include exemption from taxes on all income and receipts, exemptions from import duties on personal effects and vehicles, and the ability to conduct business from Belize, as long as it is primarily conducted outside the country and not with Belizeans.

Other Tax Incentives

• No Capital Gains Tax: Belize does not impose a capital gains tax on real estate sales.
• Tax Holidays: Businesses can seek approval for tax holidays of up to 15 years.
• Duty Exemptions: Available on specific imported items for businesses under approved programs.
• Repatriation of Profits: Foreign investors registered with the Central Bank can repatriate 100% of profits and investments.

General Information Incentive programs are subject to eligibility criteria and require application through designated authorities such as BELTRAIDE. Requirements and procedures may vary, so it's recommended to contact relevant government agencies or seek professional advice for program-specific details. Please note that this information is current as of February 5, 2025, and may be subject to change. Consulting official government resources is always recommended for the most up-to-date information.