Taxes in Belize

Belize's tax system is based mainly on the Tax Administration and Procedures Act, the Income and Business Tax Act and the General Sales Tax Act. The Belize dollar is fixed at 2.0175 BZD to 1 USD. The Belize Tax Service Department, commonly called BTSD, administers Income Tax, Business Tax, PAYE, withholding tax, General Sales Tax and refunds. PAYE means tax that an employer deducts from an employee's pay and sends to BTSD. Customs and Excise manages import duty, revenue replacement duty, excise and environmental tax through ASYCUDA at airports, seaports and land borders. The Ministry of Finance and Commissioner of Stamps deal with Stamp Duty, while the Valuation Unit of the Ministry of Natural Resources assesses land values for Land Tax. An employed resident generally receives a BZD 20,000 deduction before Income Tax is calculated when annual income exceeds BZD 29,000. Income below BZD 29,000 generally does not produce Income Tax under this rule. Income between BZD 29,000 and BZD 32,000 can qualify for a tax credit of up to BZD 2,250, reduced by 75% of the amount above BZD 29,000. The standard Income Tax rate on chargeable income is 25%. Employers usually collect PAYE, and the annual Income Tax Return is generally due by 31 March. Foreign-derived revenue or income from a trade, business or profession can receive a statutory special exemption for affected employed persons, but eligibility requires case-by-case review. A qualified retired person can optionally pay 2% on the pension amount above GBP 3,500 or its equivalent under the applicable arrangement. Business Tax is generally charged on gross receipts rather than profit, so ordinary business expenses are not deducted from the taxable base. A trade or business whose only livelihood is trading generally registers from BZD 75,000 annual receipts. A self-employed profession or vocation whose only livelihood comes from that activity generally registers from BZD 20,000. Income from investments, real property, personal property or personal services can create liability independently of those thresholds. The main rates include 0.75% for radio, television, newspapers and fuel service stations; 1.75% for general trade, domestic airlines, insurance and most real-estate sales or development; 3% for rent, royalties and real property; 6% for professions, vocations, occupations, tour operators and travel agents; and 5% on commissions below BZD 25,000 per year or 15% above that amount. Banks and financial institutions have sector-specific rates from 12% to 18%. International financial services under the IFSC rate can be 3%, while mixed domestic receipts can be taxed at 6%. Telecom real-time voice services are taxed at 19%. Building contractors generally apply 6% to the first 40% of a contract price and 1.75% to the remaining 60%. Petroleum income is taxed at 40% of chargeable income in USD, and an approved Designated Processing Area can use 3% of net chargeable income. General company-profit Income Tax has been 0% from basis year 2020, but Business Tax remains separate. Business Tax paid can generate a credit against Income Tax, with excess amounts carried forward or, where a return is filed on time, potentially remitted. Contract payments can trigger withholding under the amended 2025 rule. The normal activity rate applies, but where that rate is below 6%, withholding is generally 50% of the normal rate. Failure to apply the rule can lead to BZD 100 or 10% of the tax due, whichever is higher. Payments to non-residents generally have withholding rates of 15% for dividends and loan interest, 25% for insurance premiums, management fees, rental plant or equipment and technical services. For a CARICOM signatory, dividends can be 0%, while interest, royalties and management fees can be 15%. General Sales Tax, or GST, is normally 12.5%. A business generally registers when taxable turnover reaches BZD 75,000 per year, or when average taxable supplies reach BZD 6,250 per month during a first operating period of less than twelve months. Public-entertainment promoters or licensees can require registration regardless of the turnover threshold. Voluntary registration is generally limited to a business making taxable supplies, usually with at least 80% of supplies made to taxable persons. Zero-rated supplies carry a 0% rate, while exempt supplies do not count toward taxable turnover and do not normally generate an input-tax credit. A registered business calculates GST as output tax minus permitted input tax credits. Belizean e-commerce is generally taxed at 12.5%; overseas sales are generally zero-rated where the required location and export evidence exists. A non-registered supplier may not advertise prices as GST-included. Land Tax is 1% of unimproved market value. The Valuation Unit determines that value under the Fourth Schedule according to location, size and use. Stamp Duty on instruments such as land transfers, mortgages and company-share transfers is based on open-market value. Land transfers generally attract 5% for Belizeans and CARICOM nationals and 8% for foreigners, subject to the applicable legal classification. The Commissioner of Stamps can review the stated market value. Import Duty follows the Customs Tariff and HS classification and ranges from 0% to 100%, with many goods around 20%. Customs generally calculates it on CIF value. Import GST is calculated on CIF plus Import Duty and, where applicable, Revenue Replacement Duty, excise and environmental tax. Environmental Tax is 3% of CIF. CARICOM goods supported by a Certificate of Origin are generally free of import duty, although Revenue Replacement Duty or an import licence can still apply. Taxpayers obtain a Taxpayer Identification Number, or TIN, and register with BTSD using forms such as BTS100 or BTS101. Companies, partnerships and sole traders provide different registration evidence. IRIS Belize allows online returns, payments, account statements, upcoming-return information and refund-status checks. Online filing and payment for BTSD tax types has been available since 1 April 2023, and an IRIS account is free. GST returns use form BTS210 together with sales and purchase ledgers. GST and Business Tax returns and payments are generally due by the 15th of the following month. Electronic records and supporting documents generally need to be kept for at least six years, including GST records. Fraud or omission can allow reassessment for up to six years. Late Business Tax filing or payment can attract 10% of tax due for each month or part of a month, up to 24 months, and late-payment interest is 1.5% per month. Late GST filing generally attracts a one-time 10% charge; a nil return can attract BZD 10 per return, up to BZD 10,000. A statement of emoluments can also attract BZD 10 per statement, up to BZD 10,000. Late GST payment can add 10% plus 1.5% interest per month. A waiver request is assessed individually and does not automatically suspend the payment obligation. Under the Tax Administration and Procedures Act, a taxpayer can request account information or copies of returns; a return copy generally costs BZD 25. An objection goes to BTSD and then the Tax Board. A Board hearing generally has a maximum period of 90 days, and a further appeal to the Supreme Court must generally be filed within 30 days after the Board's decision. The appellant carries the burden of proof. Belize focuses on income sourced, accrued or derived in Belize. Foreign-tax relief can apply after the foreign tax and liability have been demonstrated. BTSD's stated treaty coverage includes Austria, the United Kingdom, Switzerland, CARICOM and the United Arab Emirates. Belize also exchanges information under tax-information exchange agreements and multilateral arrangements. Financial institutions covered by CRS or FATCA may need registration and annual nil or reportable filings by 31 March; a late CRS filing can attract BZD 10,000. Country-by-country reporting applies to a Belize-resident ultimate parent of a multinational group with consolidated revenue of at least USD 850 million, generally within twelve months after the fiscal year. Entities subject to the Economic Substance Act, including relevant holding companies, generally file Forms B, C or D within nine months after the fiscal year; a Non-Included Entity can use the Form E exemption pathway. Former IBCs are not automatically tax-free and may need re-registration and annual Business Tax filing according to BTSD guidance. Cross-border structures, petroleum, Designated Processing Areas, IFSC services, property transfers and withholding require professional review because the result depends on source, activity, entity, nationality, treaty status and records.