Cayman Islands
Tax Guide: Cayman Islands
Population: 71,105 (October 2021 Census)
Currency: Cayman Islands dollar (KYD)
Principal Business Entities: The main forms of business vehicle established in the Cayman Islands are: exempted companies, limited liability companies, exempted limited partnerships, segregated portfolio companies, special economic zone companies and local ordinary companies.
Last modified: 27/06/2023 14:25
Corporate taxation
| Rate | |
|---|---|
| Corporate income tax rate | 0 |
| Branch tax rate | 0 |
| Capital gains tax rate | 0 |
- xxxxxxxx
- xxxxxxxx
Residence: As the Cayman Islands is a tax neutral jurisdiction, meaning there is no corporate income, capital gains, payroll or other direct taxes which are currently imposed on corporations in the Cayman Islands, corporate residency is not relevant in the context of Cayman Islands taxation. Entities engaged in trade and business in the Cayman Islands, as defined within the Trade and Business Licensing Law are required to have a Trade & Business License in accordance with that law.
Basis: There is no corporate income, capital gains, payroll or other direct taxes imposed on corporations in the Cayman Islands.
Taxable income: N/A
Significant local taxes on income: N/A
Alternative minimum tax: N/A
Taxation of dividends: N/A
Capital gains: N/A
Losses: N/A
Foreign tax relief: N/A
Participation exemption: N/A
Holding-company regime: N/A
Tax-based incentives: N/A
Group relief/fiscal unity: N/A
Small company/alternative tax regimes: N/A
Corporate taxation: compliance
Tax year: N/A
Consolidated returns: N/A
Filing and payment: N/A
Penalties: N/A
Rulings: N/A
Taxation of individuals
| Rate | |
|---|---|
| Federal Income Tax | |
| Item 1 | 0 |
| Item 2 | 0 |
| Item 3 | 0 |
- xxxxxxxx
- xxxxxxxx
Residence: There is no income tax for individuals.
Basis: N/A
Taxable income: N/A
Capital gains: N/A
Deductions and allowances: N/A
Foreign tax relief: N/A
Taxation of individuals: compliance
Tax year: N/A
Filing and payment: N/A
Penalties: N/A
Rulings: N/A
Withholding taxes
| Type of Payment | Resident recipients | Non-residents recipients | ||
|---|---|---|---|---|
| Company | Individual | Company | Individual | |
| Rate (%) | Rate (%) | Rate (%) | Rate (%) | |
| Item 1 | 0 | 0 | 0 | 0 |
| Item 2 | 0 | 0 | 0 | 0 |
| Item 3 | 0 | 0 | 0 | 0 |
| Item 4 | 0 | 0 | 0 | 0 |
- xxxxxxxx
- xxxxxxxx
Branch remittance tax: N/A
Anti-avoidance legislation
Transfer pricing: N/A
Interest restriction: N/A
Controlled foreign companies: N/A
Hybrid mismatches: N/A
Disclosure requirements: N/A
Exit taxes: N/A
General anti-avoidance rule: N/A
Digital services tax and Other significant anti-avoidance legislation: N/A
Value-added tax/Goods and services tax
Type of tax: There is no value-added tax imposed in the Cayman Islands. Import duty must be paid on the importation of most goods at a rate of 22% – 27%. Further information on tariff rates can be found on the Cayman Islands Customs’ website www.customs.gov.ky
Standard rate: N/A
Reduced rates: N/A
Registration: N/A
Filing and payment: N/A
Social security contributions
| Employer | Employee | |
|---|---|---|
| Rate (%) | Rate (%) | |
| Band 1 | 0 | 0 |
| Band 2 | 0 | 0 |
| Band 3 | 0 | 0 |
Self-employed
N/A
Other taxes
Capital duty: N/A
Immovable property taxes: There are no property taxes in the Cayman Islands.
Transfer tax: N/A
Stamp duty: Stamp duty on transfers of immovable property in the Cayman Islands is paid at a general rate of 7.5%. Stamp duty in the form of a transfer tax equal to the applicable stamp duty, also applies to transfers of shares in land holding companies. Stamp duty may also be payable if any documents are executed in, after execution brought to, or produced because a court in the Cayman Islands. Such stamp duty will be nominal in most instances and is capped at KYD 500. Stamp duties also apply on legal or equitable mortgages or charges of immovable property or debentures ranging from 1% to 1.5% depending on the sum secured.
Net wealth/worth tax: N/A
Inheritance/gift taxes: N/A
Other: N/A
Tax treaties
The Cayman Islands has signed 36 Bilateral Agreements, of which 29 are currently in force in the Cayman Islands. For the latest list of Bilateral Agreements, please refer to the Tax Information Authority’s website http://tia.gov.ky/pdf/International_Exchange_of_Information_Instruments.pdf
The Cayman Islands agreed with the United Kingdom government to implement the Savings Directive, with the Reporting of Savings Income Information (EU) Law (2007 Revision). This sets out a reporting regime whereby Cayman paying agents that are making payments to individuals who are tax resident in an EU member state may have to report the interest paid.
The Cayman Tax Information Authority is responsible for receiving and facilitating the submission of such information reporting.
The Cayman Islands also complies with the regulations set forth under Common Reporting Standards (CRS).
The Cayman Islands and the United States and the Cayman Islands and the United Kingdom has also signed agreements to Improve International Tax Compliance and to Implement the Foreign Account Tax Compliance Act, to accommodate the non-direct tax system of the Cayman Islands. under these agreements, Cayman Islands financial institutions are required to provide the Cayman Islands competent authority with the required information which will then forward to the competent authority in the relevant jurisdiction.
The Cayman Islands has also entered into Country-by-Country Reporting as part of the Base Erosion and Profit Shifting (BEPS) Action Plan as set forth by the Organization for Economic Co-operation and Development (OECD). This requires multinational enterprises to include detailed financial and tax information relating to the global allocation of their income and taxes, among other indicators of their economic activity.
The Cayman Islands responsible authority has committed to the annual exchange of information, on an automatic basis, with all such other competent authorities of jurisdictions with respect to which the Cayman Islands has an agreement in effect.