Income tax on rent, worked example, in Barbados
December 02, 2016
|Non-resident couple´s rental income1|
|Monthly Rental Income2||€1,500||€6,000||€12,000|
|Annual Rental Income||18,000||72,000||144,000|
|Less Withholding tax3||25%||4,500||18,000||36,000|
|= Taxable Income||9,000||36,000||72,000|
|Annual Income Tax Due||1,350||5,400||10,800|
|Tax Due as % of Gross Income||7.50%||7.50%||7.50%|
1 The property is jointly owned by husband and wife.
2 Exchange rate used: 1.00 US$ = 2.00 BBD
3 Rental income earned by nonresidents is subject to 25% withholding tax. The withholding tax is credited against the taxpayer´s final income tax liability.
4 Estimated values. Income-generating expenses are deductible when calculating taxable income.
5Rental income earned by nonresident individuals is taxed at a flat rate of 15%.