JIS News

Story Highlights

  • Self-employed persons are being reminded that the calculation of their personal income tax will change as at July 1.
  • Senior Technical Specialist at Tax Administration of Jamaica (TAJ), Monica Walker, said 25 per cent income tax will be applied to earnings from July to December 2016 between the effective threshold of $796, 537 up to $6 million.
  • Thirty per cent income tax will be applied to earnings in excess of $6 million.

Self-employed persons are being reminded that the calculation of their personal income tax will change as at July 1.

Senior Technical Specialist at Tax Administration of Jamaica (TAJ), Monica Walker, said 25 per cent income tax will be applied to earnings from July to December 2016 between the effective threshold of $796, 537 up to $6 million.

Thirty per cent income tax will be applied to earnings in excess of $6 million.

For the January to June 2016 period, however, the income tax is 25 per cent irrespective of the amount of income earned.

“If you earned $10 million from July to December, it means that the expenses that you will be allowed against this $10 million (relates to) expenses incurred as at July through to December. So, if you had an expenditure made in May, you will not be able to claim this expense against the income earned July to December, because the tax rate is different,” Miss Walker explained.

She was speaking at a Jamaica Information Service (JIS) Think Tank at the JIS Head Office on July 1.

These changes follow the announcement by Finance and Public Service Minister, Hon. Audley Shaw, in May of an increase to the income tax threshold for all employed persons.

The new threshold of $1,000,272, which takes effect July 1, will result in an effective threshold of $796,537 for the period of assessment for 2016.

Chief Communication Officer at TAJ, Meris Haughton, said self-employed persons declare taxes on an annual basis and pay on a quarterly basis based on their estimated income and would have already paid for two quarters this year.

“With the new threshold in effect, they will need to make an adjustment to their declaration and reduce the amount that they pay on a quarterly basis,” she said.