Virgin Islands Tax Advantages
Living in the Virgin Islands has its’ TAX ADVANTAGES
Income Tax Benefit Programs
There are various tax benefit programs available to residents and businesses of the Virgin Islands through the Economic Development Program (EDC) and the University of the Virgin Islands Research and Technology Park (RTPark). These programs offer tax credits of up to 90% of the income tax due. We would be happy to introduce you to legal and accounting professionals who could advise you on eligibility and assist you in applying for the tax benefits. (More Detail below)
Comparatively Low Property Taxes
As a new homeowner. there is good news regarding property taxes in our Islands. You’ll find that tax property rates in the V.I. are quite a bit lower than comparable areas in the US mainland. (More Detail below)
Business Tax Exemptions
Tax benefit programs exist as well as special exemptions. (More Detail below)
If you would like to know more about participation in the EDC tax credits program as well as other exemption opportunities get in touch with our “resident tax specialist” Joyce Bailey CPA.
The Virgin Islands Government has the ability to offer tax benefits to businesses doing business in the Virgin Islands. Under the mirror tax system the VI uses the US Internal Revenue Code and all the US tax forms but the taxes collected are remitted to the Virgin Islands Bureau of Internal Revenue rather than the IRS. An individual who is a bona fide VI resident for the entire tax year files a VI return and pays VI tax on his worldwide income for the that year. If the US citizen properly files and reports all his income from all sources on a VI tax Return and pays the VI tax, he is not subject to tax in the US. Special rules apply to determine if a person is a bona fide VI resident and if income is possessions source income. There are various tax benefit programs available to residents and businesses of the Virgin Islands through the Economic Development Program (EDC) and the University of the Virgin Islands Research and Technology Park (RTPark). These programs offer tax credits of up to 90% of the income tax due. I would be happy to introduce you to legal and accounting professionals who could advise you on eligibility and assist you in applying for the tax benefits.
The USVI property tax code is presently undergoing a substantial 3-year long Federal Court ordered restructuring. Although it is still under final consideration by the Court, it is expected that the proposed assessment system will be approved without significant changes. The new valuation formula is expected to use market value as the assessed value and then a multiplier rate will be applied to that value. At the time of this writing the multiplier for residential real property is proposed to be 0.00377, or a little over one third of one per cent per annum. Undeveloped property is proposed at 0.004946, or roughly one half of one percent. These rates are quite a bit lower than comparable waterfront areas in the US mainland.
Gross receipts tax:
All USVI businesses are subject to a gross receipts tax. EDC and RT Park beneficiaries receive a 100% exemption from the gross receipts tax. For businesses whose gross income is over $225,000 annually, there is a 4% tax imposed. However there are exemptions based on a monthly minimum.
Corporate income tax surcharge:
There is a 10% corporate income tax surcharge on all C corporations.
For additional information on the USVI tax landscape, please visit the website of the USVI Internal Revenue Bureau: www.viirb.com
TAX BENEFIT PROGRAMS:
For additional information on the Economic Development Program, please visit the official government website of the EDC at: www.usvieda.org
For additional information on the UVI Research and Technology Park, please visit the official government website of the Park at: www.uvirtpark.com
We also recommend that anyone interested in the EDC program contact legal firms who are experienced in assisting applicants to become participants in this program.
The Bornn Firm: www.bornnfirm.vi