Although known for its tropical beaches that attract many tourists, Barbados has a lot more to offer. Until the 2000s, the economy depended mostly on the sugar industry. As it developed over the years, Barbados now has a mixed economy that brings high living standards and a spectrum of professional services satisfies the needs of the domestic and international business sector.
Disclaimer: Be aware that this article is not a substitute for legal advice. Please always check official websites or seek legal advice before you take action.
Sole proprietorship in Barbados
Barbados has a lot of potential for new businesses due to its excellent telecommunications, efficient air and seaports, and stable currency. It is a stable environment to establish and operate a new business. A sole proprietorship is a widespread business type in Barbados due to an easy establishment and possibility to grow and develop into other advanced business forms.
How to register a sole proprietorship
Registering a business in Barbados is a very straightforward process. The first step is to register your business with the Corporate Affairs and Intellectual Property Office (CAIPO). For registration of sole proprietorships, the only requirement is for you to choose a business name that is available at the Register and register for it. You may also want to register the trademark. The fee for registering a business name is BDS $104. You can collect the business name certificate in 5 workdays.
Depending on the type of business you want to do, you should contact the authorities for additional licenses and permits that should be issued to you.
Business must be also registered at the National Insurance Department, where you will be issued a national insurance number.
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Tax registration and taxation system in Barbados
All businesses must register with the Barbados Central Revenue Authority, where you will be issued with an Income Tax number and a Value Added Tax number. You should seek a Tax Administration Management Information System (TAMIS), an online tax system. When you register for TAMIS, you will get a tax number to use when filing and paying taxes.
Value added tax (VAT) is calculated at a 17.5% rate, and it is submitted to all goods and services that are produced. It is calculated for all commercial activities. On the other hand, the personal income tax is filled for all individuals who are creating revenue on the island of Barbados.
Income tax is calculated at the basic rate of 12.5% to income up to BBD 50,000, while the higher rate of 28.5% is applied to taxable income above BBD 50,000, considering the applicability of the basic rate for the first BBD 6,250 over the threshold.
