By Andreas Ghani | CompareHero
April is almost at an end, and that means the tax season deadline is fast approaching. For residents and non-residents without additional business income (that’s form BE and M), your deadline for filing those income tax return forms is on April 30, 2014. On the other hand, for residents and non-residents with additional business income (form B and M), don’t miss the deadline on June 30, 2014.
Tax evasion is a serious offence, and you can be charged with fines, or sent to prison. It’s better to file your income taxes late and pay the penalty fees than be taken to court for tax evasion. It’s also better to file your income tax returns now, since you might be paying more taxes than you should and you can get tax refunds, rebates and reliefs!
However, did you know there are countries that don’t have to file their income tax returns because they actually have none? Here’s a list of nine countries that don’t impose income tax on their citizens:
United Arab Emirates (UAE)
With a high per-capita income at $49,000 and a gross domestic product (GDP) of $360 billion, UAE is the first on our list. How does the country generate revenue? Instead of deducting from personal income, the country taxes oil companies up to 55% in corporate taxes. Aside from that, they charge 30-50% tax on alcohol, depending on which Emirate. There are also other indirect taxes, such as housing fees, municipal taxes, road tolls, and service charges.
With a high per-capita income at $49,000 and a gross domestic product (GDP) of $360 billion, UAE is the first on our list. How does the country generate revenue? Instead of deducting from personal income, the country taxes oil companies up to 55% in corporate taxes. Aside from that, they charge 30-50% tax on alcohol, depending on which Emirate. There are also other indirect taxes, such as housing fees, municipal taxes, road tolls, and service charges.
Kuwait
Kuwait has the world’s sixth largest oil reserves, accounting for 75% of government revenue, making the country’s GDP at $173 billion. Aside from petroleum and natural gas, Kuwait has industries related to shipping, construction, cement, and water desalination. As with other Middle Eastern countries, corporate tax is another way of gaining revenues in Kuwait; income of foreign companies is taxed at 15%. Employees with Kuwaiti nationality also contribute 7.5% of their income for social security liabilities, and employers contribute 11%.
Kuwait has the world’s sixth largest oil reserves, accounting for 75% of government revenue, making the country’s GDP at $173 billion. Aside from petroleum and natural gas, Kuwait has industries related to shipping, construction, cement, and water desalination. As with other Middle Eastern countries, corporate tax is another way of gaining revenues in Kuwait; income of foreign companies is taxed at 15%. Employees with Kuwaiti nationality also contribute 7.5% of their income for social security liabilities, and employers contribute 11%.
Cayman Islands
One of the British Overseas Territories, Cayman Islands is a three-island group in the Caribbean. The country’s main primary source of income is indirect taxation, as there’s no income tax or corporate tax. The country charges up to 22% in import duties. Their local currency, the Cayman Islands Dollar (KYD), is pegged after the US Dollar (USD) at a fixed rate of 1KYD to 1.2 USD. Since there’s no direct taxation, Cayman Islands is a thriving offshore financial centre with over 93,000 registered companies in 2008 including 300 banks, 800 insurance companies, and 10,000 mutual funds. Tourism accounts for about 70% of the country’s GDP, which was at $3.28 billion in 2008.
One of the British Overseas Territories, Cayman Islands is a three-island group in the Caribbean. The country’s main primary source of income is indirect taxation, as there’s no income tax or corporate tax. The country charges up to 22% in import duties. Their local currency, the Cayman Islands Dollar (KYD), is pegged after the US Dollar (USD) at a fixed rate of 1KYD to 1.2 USD. Since there’s no direct taxation, Cayman Islands is a thriving offshore financial centre with over 93,000 registered companies in 2008 including 300 banks, 800 insurance companies, and 10,000 mutual funds. Tourism accounts for about 70% of the country’s GDP, which was at $3.28 billion in 2008.
Qatar
This Middle Eastern country has a GDP of $183 billion, according to Forbes.com, with more than 50% accounting for oil and gas export and revenues. In 2013, Global Finance Magazine named Qatar the world’s richest country, based on its GDP based on Purchasing Power Parity. The local government here also doesn’t charge any road tax, car tax, council tax or value added tax (VAT). Business entities are taxed at a flat rate of 10% corporate tax, however, and there’s a 7% government tax in hotels and restaurants. The cost of living in Qatar, however, is very high.
This Middle Eastern country has a GDP of $183 billion, according to Forbes.com, with more than 50% accounting for oil and gas export and revenues. In 2013, Global Finance Magazine named Qatar the world’s richest country, based on its GDP based on Purchasing Power Parity. The local government here also doesn’t charge any road tax, car tax, council tax or value added tax (VAT). Business entities are taxed at a flat rate of 10% corporate tax, however, and there’s a 7% government tax in hotels and restaurants. The cost of living in Qatar, however, is very high.
The BahamasA country in the Caribbean, it relies on offshore financing and tourism as its main economic industries. 36% of the Bahamas’ $11.4 billion GDP is from financial services, and more than 60% is from tourism. Aside from no income tax, the country also has no corporate tax, value added tax, and capital gains tax. Payroll taxes, however, are imposed at 3.9% paid by the employee and 5.9% paid by the employer.
Bahrain
Yet another Middle Eastern country, Bahrain relies on petroleum from its shared oilfield with Saudi Arabia, accounting for 70% of the country’s budget revenue, 60% of export, and 11% of GDP. Their second-biggest export after oil is aluminium, followed by finance and construction. The country experienced some economic setbacks in 2011, but has since recovered thanks to improved tourism in 2012. Employees contribute 6% of their monthly earnings to social security, while employers cover 9%.
Yet another Middle Eastern country, Bahrain relies on petroleum from its shared oilfield with Saudi Arabia, accounting for 70% of the country’s budget revenue, 60% of export, and 11% of GDP. Their second-biggest export after oil is aluminium, followed by finance and construction. The country experienced some economic setbacks in 2011, but has since recovered thanks to improved tourism in 2012. Employees contribute 6% of their monthly earnings to social security, while employers cover 9%.
Bermuda
Another British Overseas Territory, this island country’s economy is based on offshore insurance and reinsurance, and tourism. Its GDP per capita is almost 70% higher than the United States, at $86,000 in 2011. In lieu of an income tax system, Bermuda has consumption taxes (VAT, service charge, and the like), payroll taxes, real estate taxes, and high import duties. Because of this, Bermuda is considered to be among the list of countries with a high cost of living in the world.
Another British Overseas Territory, this island country’s economy is based on offshore insurance and reinsurance, and tourism. Its GDP per capita is almost 70% higher than the United States, at $86,000 in 2011. In lieu of an income tax system, Bermuda has consumption taxes (VAT, service charge, and the like), payroll taxes, real estate taxes, and high import duties. Because of this, Bermuda is considered to be among the list of countries with a high cost of living in the world.
Oman
Just like its Middle Eastern neighbours, Oman does not have income tax. The country also relies on its oil revenues, which accounts for close to 70% of the country’s total revenues. As with other Middle Eastern countries, Oman imposes a corporate tax of 12% for local businesses and up to 30% for foreign businesses and corporations owned by non-GCC states. Their GDP is at $95 billion, despite the dwindling natural oil reserves. Because of this, their unemployment rate has risen to 15%, to the dissatisfaction of Omani citizens.
Just like its Middle Eastern neighbours, Oman does not have income tax. The country also relies on its oil revenues, which accounts for close to 70% of the country’s total revenues. As with other Middle Eastern countries, Oman imposes a corporate tax of 12% for local businesses and up to 30% for foreign businesses and corporations owned by non-GCC states. Their GDP is at $95 billion, despite the dwindling natural oil reserves. Because of this, their unemployment rate has risen to 15%, to the dissatisfaction of Omani citizens.
Brunei Darussalam
The only Southeast Asian country with no income tax is Brunei. Located in Borneo and formerly a British Protectorate, Brunei’s industries mainly rely on petroleum, natural gas, construction, and agriculture. Its GDP is at $22.25 billion, made up mostly of its petroleum and gas exports. Even though there isn’t any income tax, Brunei citizens are required to pay a social security trust fund at 5% of their salaries, and an additional 3.5% that goes to their pension funds. There’s also a 12% real property tax in the country’s capital, Bandar Seri Begawan, and a corporate tax of 20% for local and non-local companies.
The only Southeast Asian country with no income tax is Brunei. Located in Borneo and formerly a British Protectorate, Brunei’s industries mainly rely on petroleum, natural gas, construction, and agriculture. Its GDP is at $22.25 billion, made up mostly of its petroleum and gas exports. Even though there isn’t any income tax, Brunei citizens are required to pay a social security trust fund at 5% of their salaries, and an additional 3.5% that goes to their pension funds. There’s also a 12% real property tax in the country’s capital, Bandar Seri Begawan, and a corporate tax of 20% for local and non-local companies.
As you can see from the list, a lot of the countries with no income tax are found in the Middle East. This is due to the local natural reserves of oil. The downside, however, is that most of these countries have a high cost of living.
Source: https://my.news.yahoo.com
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