Individual taxation overview
Foreign income tax
Capital gains tax
Income tax is charged on income depending on where that income has been accrued or derived and which tax residence status you have.
|Type of income||Arising in Dominica||Arising outside Dominica|
|Residents/ Ordinarily resident||Chargeable at progressive rates, see below|
|Non-ordinarily resident||Chargeable at progressive rates, see below. Income arising outside Dominica is taxed only when remitted to Dominica.|
|Non-residents||Withholding tax 15%||0%|
Income tax rates are applied as follows:
- 15% on income up to XCD 20,000.
- 25% on the next XCD 30,000.
- 35% on income over XCD 50,000.
Taxable income includes employment and business income, dividend and rental income.
Allowances and deductions
Resident personal allowance is XCD 25,000.
A tax credit is available for foreign tax paid in another country by a resident.
Some expenses can be deducted from the taxable income, and they include i.a. charitable contributions, mortgage interest, etc.
Exempt income includes interest from bank deposits in Dominica to a resident or a non-resident, redundancy payments and others.
Social security contributions
The employee must contribute 5.25% of their gross salary for retirement, disability and sickness benefits.
The employer’s portion is 7%.
Maximum amount of monthly contributions for both employee and employer is XCD 6,000 each.
Up to 1.25% of the value of land or house depending on geographical location and use of property.
Taxable goods include alcohol, cigarettes, petrol, and vehicles. They are taxed when imported in Dominica and taken for sale from the registered manufacturer’s warehouse in Dominica.
VAT is charged at a rate of 15% on almost all goods and services imported to and sold in Dominica. Accommodation and diving activity is taxed at 10%. Some goods and services are tax exempt.