Trinidad and Tobago
The country profile includes data on the income taxes paid by workers, their social security contributions, the family benefits they receive in the form of cash transfers as well as the social security contributions and payroll taxes paid by the employers. Results reported include the average and marginal tax burdens for eight different family types.
It also describes the personal income tax systems, all compulsory social security contribution schemes and universal cash transfers as well as recent changes in the tax/benefit system.
The national currency is the Trinidad and Tobago dollar (TTD). In 2013, the average official exchange rate was TTD 6.39 to USD 1. In that year, the average worker earned TTD 49 304.75.
The Report includes estimates of the tax wedge over the whole of the income distribution ordered by deciles of total labour income of formal wage earners derived from the household surveys.
1. Personal income tax system
The tax year for the personal income tax is the calendar year.
1.1. Central government income tax
The Income Tax Act Ch:75:01 and the Income Tax Employment Regulations Act 77/57, together with subsequent updates, represent the legislation governing the income tax in Trinidad and Tobago.
The taxable income of employees includes salaries, wages, bonuses, overtime, the value of board or lodging, stipend, commission or other payments for services, directors fees, retirement allowances or pensions accruing or received in Trinidad and Tobago. It does not include any salary or share of profits arising from a trade, profession or vocation carried on by an individual either as a sole trader or in partnership.
1.1.1. Tax unit
Members of the family are taxed separately
Individuals residing in Trinidad and Tobago are liable to personal tax on their worldwide income.
1.1.2. Tax allowances and tax credits
1.1.2.1. Standard tax allowances and tax credits
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A personal allowance of TTD 60 000.
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70% of employee social security contributions up to TTD 30 000.
1.1.2.2. Main non-standard tax allowances and tax credits
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Foreign tertiary education expenses up to TTD 60 000 subject to an acceptance letter, proof of payment and statement of expenses being provided.
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A deduction for first-time home owners limited to TTD 18 000.
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Deferred annuities, tax savings and pension fund plans up to TTD 30 000.
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Alimony or maintenance paid in accordance with a court ruling.
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Travelling expenses, for official purposes, up to two thirds of the total.
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A tax credit for purchases of solar water heating equipment.
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A tax credit for venture capital investments up to 25% of the total investment.
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A tax credit for purchases of CNG kits and cylinders (equipment to adjust cars to run on natural gas).
The annual income tax liability was a flat rate 25% of taxable income in 2013.
1.3. State and local taxes
No state or local taxes are levied on wages.
2. Compulsory social security contributions
2.1. Employee and employer contributions
Employees and employers are required to pay contributions, levied on gross wages, for old age, disability and survivors programs to the National Insurance Board. Payments were in accordance with the following schedule in 2013.
In addition, employees, and other individuals also pay a health surcharge, levied on gross income to cover the provisions of health services in Trinidad and Tobago. The schedule of contributions is as follows:
3. Universal cash transfer
3.1. Amount for spouse and for dependent children
None.
4. Main changes in tax/benefit since 2013
The personal income tax allowance was increased to TTD 72 000 in 2015.
5. Memorandum items
5.1. Identification of an AW
The average worker’s wage and average deciles of income have been estimated from data collected in the Household Budget Survey 2008/2009, adjusted for inflation.