BARBADOS

Name of country

  • BARBADOS

Region

  • Caribbean, island in the North Atlantic Ocean, northeast of Venezuela

 Population

  • 301,865 (July 2021 est.)

General Introduction

  • Barbados is a fantastic destination to live, work, and enjoy yourself. Barbados is a highly appealing site for international business due to its modern infrastructure, business-friendly atmosphere, and excellent quality of life ratings. Barbados residents have access to a wide selection of high-quality housing options, as well as a safe and secure living environment, as well as decent health care and educational opportunities. The island, which is one of the world's most popular vacation locations, offers excellent dining and entertainment options as well as a variety of world-class lifestyle activities such as golf, sailing, polo, and cricket, to mention a few.

Wifi Speed

  • From May 2018 to May 2019, broadband internet in Barbados had an average download speed of 16.03 Megabits per second (Mbps). This represents a considerable increase when compared to the result obtained between June 2016 and May 2017, indicating an average download speed at the time of 6.62 Mbps..

Electrical outlet

  • For Barbados there are two associated plug types, types A and B. Plug type A is the plug which has two flat parallel pins and plug type B is the plug which has two flat parallel pins and a grounding pin. Barbados operates on a 115V supply voltage and 50Hz.

Per Capita GDP 

Real GDP per capita

  • $15,639 (2019 est.)
  • $15,675 (2018 est.)
  • $15,789 (2017 est.)

Climate

  • tropical; rainy season (June to October)

Residence-by-Investment

  • Barbados does not have a citizenship by investment scheme, but in 2020 it created the Welcome Stamp Visa, a one-year visa that allows remote workers to stay on the island for up to 12 months. Given that people all over the world have been compelled to work from home, this new program offers an exciting option for individuals seeking a change of scenery in a region that has been mildly affected by the pandemic while also recovering their work/life balance. This program, sometimes known as a "digital nomad visa," is suitable for anyone who only needs a stable internet connection to work and wants the freedom to work from anywhere on the globe.

Barbados Welcome Stamp

  • Cost of program: $2000 individual or $3000 for a couple/family
  • Length: 1 year
  • Income to prove: $50,000 per year

Natural Resources

  • petroleum, fish, natural gas

Ethnic Groups

  • African descent 92.4%, mixed 3.1%, White 2.7%, East Indian 1.3%, other 0.2%, unspecified 0.3% (2010 est.)

 Languages

  • English (official), Bajan (English-based creole language, widely spoken in informal settings)

 Religion

  • Protestant 66.4% (includes Anglican 23.9%, other Pentecostal 19.5%, Adventist 5.9%, Methodist 4.2%, Wesleyan 3.4%, Nazarene 3.2%, Church of God 2.4%, Baptist 1.8%, Moravian 1.2%, other Protestant 0.9%), Roman Catholic 3.8%, other Christian 5.4% (includes Jehovah's Witness 2.0%, other 3.4%), Rastafarian 1%, other 1.5%, none 20.6%, unspecified 1.2% (2010 est.)

Median Age

  • total: 39.5 years
  • male: 38.4 years
  • female: 40.7 years (2020 est.)

Urbanization

  • urban population: 31.2% of total population (2021)
  • rate of urbanization: 0.46% annual rate of change (2020-25 est.)

 Physician density

  • 2.48 physicians/1,000 population (2017)

Government type

  • parliamentary democracy under a constitutional monarchy; a Commonwealth realm

Unemployment Rate

  • 10.1% (2017 est.)
  • 9.9% (2016 est.)

Taxes

Headline Personal Income Tax Rate (highest marginal tax rate) - 38%

Headline Corporate Income Tax Rate (excluding dividend taxes)

  •  5.5% (on profits not over Bds$1 million
  • 3.0% (over Bds$1 million but not over Bds$20 million)
  • 2.5% (over Bds$20 million but not over Bds$30 million)
  • 1.0% (over Bds$30 million)

Territorial Tax / Worldwide Tax / Hybrid 

  • You will not be subject to Barbados Income Tax while on the 12 Month Welcome Stamp Visa, however, you will be subject to Barbados' 17.5 percent VAT on the products and services you purchase.
  • If you're thinking about opening a business in Barbados, the corporate tax rate is 1 percent -5.5 percent.
  • The basic rate is 12.5 percent, while the higher rate is 28.5 percent, as of January 1, 2020. The basic rate applies to the first 50,000 Barbados dollars (BBD) of taxable income; the rate increases to 28.5 percent for taxable income over BBD 50,000.

(1) Subject to subsection (2), a trust terminates on the one hundredth anniversary after the date of its creation, if not sooner terminated in accordance with the terms of the trust instrument.
(2) Subsection (1) does not apply to a purpose trust or a trust established exclusively for charitable purposes, such a trust 1nay continue in force without any limit as to time.

8. In this Part, "purpose trust" means
a) a trust, other than a trust that is for the benefit of particular persons, whether or not immediately ascertainable; or
b) a trust that is for the benefit of some aggregate of persons ascertained by reference to some personal relationship.

9. Notwithstanding any law to the contrary but subject to this section, a valid trust may be created for a non-charitable purpose, if
a) the purpose is specific, reasonable and capable of fulfillment;
b) the purpose is not immoral, unlawful or contrary to public policy;
c) the terms of the trust provide for the appointment of a protector to enforce the trust and for the appointment of a successor to such a protector: and
d) the terms of the trust specify the went upon the occurrence of which the trust terminates and provides for the disposition of surplus assets of the trust upon its termination.

10. The protector of a non-charitable purpose trust may not be a trustee thereof.

12. (1) A trustee of a trust created under section 9 shall keep in Barbados
a) a copy of the instrument creating the trust and copies of any other instrument amending or supplements the instrument;
b) a register in which the following information is set out:
i) the name of the settlor;
ii) a summary of the purposes of the trust;
iii) the name of the protector of the trust; and
iv) such documents as are necessary to show the true financial position of the trust.
(6) Where a trustee of a trust created under section 9
a) fails to comply with subsection (1) or (5);
b) refuses to allow a person referred to in subsection (5) to inspect the instrument, register or documents referred to in that subsection; or
c) in any deed, register or document referred to in subsection
(5) makes, or authorized the making of, any statement that he knows to be false or does not believe to be true, he is guilty of an offense and liable on summary conviction to a fine of
$10 000, and in addition to such fine the court may order
the trustee to cease to be a trustee of non-charitable purpose trusts for 2 years.

13. (1) Where a trust is created for a non-charitable purpose, the terms of the trust 1nay provide that the doctrine of cypress is, until mutual, applicable thereto.
(2) For the purpose of subsection (1), where a purpose that is reasonably similar to the original purpose cannot be found, a purpose that is not contrary to the spirit and meaning of the settlement may be substituted for the original purpose.

The statutory provisions do not prescribe any limits on the use and application of purpose trusts. Purpose trusts have been used to provide funding for charitable and non-charitable-objects, as well as for corporate purposes including segregation of files for bankruptcy protection and investment protection.

The provisions applicable to the taxation of purpose trusts are set out in the Income Tax Act and include the following:

Section 40(1) For the purposes of this Act, a trust ... , other than a unit trust, shall, in respect of the trust ... property and in respect of the income arising there from, need to be a separate individual.

Section 85(8) For the purposes of this Act a trust, shall be needed to be domiciled in Barbados if it satisfies any three of the following four criteria ( a) the settlor is resident in Barbados; (b) the beneficiaries are resident in Barbados; (c) the proper the trust is located in Barbados; (d) the assets of the trust consist of property situated in Barbados.

Section 5(1) Subject to this Act, the assessable income of a person is his income from all sources, whether within or outside Barbados, and ... includes the-following , ( a) business; (b) property ....

Section 6 Subject to this Act, income for an income year from a business or property is the profit derived from that business or property for that income year.

Section 17 In calculating the assessable income for an income year of a resident person who during the income year is not domiciled in Barbados, the following amount and no others shall be included, that is to say ( a) income derived from Barbados .for that income year; and ( c) income from other sources outside Barbados whenever derived to the extent that a benefit is obtained in Barbados from that income in that income year in the form of a remittance of money, an incorporation of property, the granting of credit by bank overdraft or other use or in any other or whatever.

The Barbados Trust is treated as a separate individual. There are specific tax rules applicable to trusts, namely (a) the non-deductibility of certain categories of expenses, (b) the deductible in the aggregate of· amounts payable to beneficiary which the Barbaclos Trust has paid or is under an enforceable legal obligation to pay to a beneficiary, and (c) the special rule that if amounts settled are deemed for the purposes of the Income Tax Act to be "conditional transfer in trust," then the income of that property is to be included in the assessable income of settlor and not the trust.

Where a purpose trust is resilient but not domiciled in Barbados, the assessable income of the Barbados Trust is limited in such circumstances to - Barbados source income and foreign income remitted; this expresses in an advise ,form the precise legal tests of· what is included in the assessable income of a Barbados Trust, namely:
( 7) income derived from Barbados for that income year; and
(2) Income from other sources outsell Barbados in respect of which there is a remittance or a benefit is received in Barbados.

In respect of the obligation to file a tax return, a purpose trust that has carried on business in an income year is required to file a return, whether or not assessable income is derived.
In confirming whether a return is required to be filed, it is important to determine whether the Barbados Trust has "carried on business" within the meaning of the Income Tax Act. The income Tax Act, section 85( I) defines a business as including "a profession, vocation, trade, main factor or undertaking of any kind and includes an adventure or concern in the nature of trade as well as deeming the carrying on of business in respect of· actions preparatory to an undertaking or trade, such as the offer or soliciting offers and the manufacture of' product. The determination is a question of fact having reference to all the relevant and surrounding circumstances, such that the inescapable conclusion is that the activities by their nature indicates a business undertaking.

 

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