INDIVIDUAL TAXES
SIGNIFICANT DEVELOPMENTS
A withholding tax has been imposed on interest earned from financial institutions by resident depositors, unless they have supplied the paying entity with a tax identification number. See＂Resident interest withholding tax＂below.
TERRITORIALITY AND RESIDENCE
Residents/Resident individuals are liable to tax on taxable income accruing in or derived from Fiji or elsewhere. Income derived from and subject to income tax in a country with which Fiji does not have a double taxation agreement may not be subject to tax in Fiji.
Residents are those who have been in Fiji during more than half the year, unless the Commissioner is satisfied that their usual place of abode is outside Fiji and that they do not intend to take up residence in Fiji.
Persons domiciled in Fiji are also considered resident unless their permanent place of abode is outside Fiji.
Nonresidents/Nonresidents are liable to tax only on taxable income accruing in or derived from Fiji.
Foreign personnel/Income other than employment income is not subject to tax if one of the following applies.
1. It does not accrue in Fiji.
2. It is not derived from or received in Fiji by a person whose permanent place of abode is outside Fiji and who is in Fiji solely or mainly for the purpose of engaging in employment in Fiji under a contract of employment of not more than three year's duration.
GROSS INCOME
Employee gross income/A foreign person residing in Fiji solely or mainly for the purpose of engaging in employment is subject to tax on salary earned in Fiji regardless of where payment is made and regardless of whether it is remtitted. Gross income includes wages, salaries, fees and other emoluments, living allowances, housing allowances, tax reimbursements, and other benefits received from any office or employment.
These allowances and benefits are explained below.
1. Housing-Where furnished accommodation is provided by an employer, an employee is treated as receiving a taxable benefit amounting to one-eighth(one-ninth where it is unfurnished) of basic emoluments, with a maximum benefit of $F12,000($F10,667 if unfurnished) , unless the actual rent paid by the employer exceeds $F20,000 per annum, in which case the greater of 50% of the actual rent paid or one-eighth(one-ninth if unfurnished) of basic emoluments is deemed to be the benefit. Twice the amount of a rent contribution made by the employee may be offset against this benefit.
2.Cars-A fixed sum of $F1,800 $F2,000 or $F2,4000($F1,350 $F1,500 or $F1,800 if the employee also owns a car), depending on engine capacity, is deemed to be the private benefit arising from the use or a company car.
However, if the cost of the vehicle provided to the employee exceeds $F60,000, a sum of $F2,400 plus 10% of the cost in excess of $F60,000 is adopted, irrespective of the engine capacity (subject to reduction to 75% if the employee also owns a car).
3. Personal expenses of the employee borne by the employer. However, in the case of a foreigner recruited outside Fiji, passage costs borne by the employer or reimbursed to the employee for the employee and the employee's family for initial arrival and final departure, one return journey per annum for leave purposes and journeys made for urgent family reasons are
not a taxable benefit to the employee. The exemption is limited to the cost of economy-class airfares using the most direct route between Fiji and the territory in which the employee was recruited. In all other cases,subsidized or free travel provided to employees is a taxable benefit.
Capital gains and investment income/There is no capital gains tax in Fiji.
However, gains realized from the sale or other disposition of property acquired for purposes of resale or as part of a profit-making undertaking or scheme are taxable as ordinary income and are not treated as capital gains. The proposed capital gains tax, which was to be introduced from January 1,1994, has now been deferred indefinitely.
A full exemption from tax is available on dividends received by residents of Fiji from shares held in companies listed on the Suva Stock Exchange. This measure is aimed at encouraging a wider spread of ownership of capital and the development of the Stock Exchange as a vehicle for widespread share ownership.
A foreign person's income from Fiji sources, including interest, dividends, rents, and royalties, is subject to income tax at graduated rates. However, there is a concession for dividend income from Fiji-incorporated companies.
Income from interest, dividends or royalties derived outside Fiji by a person resident in Fiji solely or mainly for the purpose of engaging in any employment under a contract of employment of not more than three years' duration is not subject to Fiji tax.
DEDUCTIONS
Business deductions/In arriving at taxable income, deductions may be taken for ex
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