Find Accountancy, Audit and Tax expertise in Barbados
There are numerous accounting and auditing firms of varying size in Barbados, including local branches of the ‘Big Four’ international accounting firms (PwC, Deloitte, KPMG and Ernst & Young). Many such firms can assist with specific guidance with regards to offshore company formation in the country. Established native firms include Ayub Kola and Company, Brian F. Griffith and Company, Financial Consulting Services Inc., Thompson Henry and Associates and Ward Patel and Company. Barbados has adopted International Financial Reporting Standards (IFRS), which are required for consolidated and standalone financial statements. Foreign companies may adopt IFRS or any other approved GAAP (Generally Accepted Accounting Principles) for statutory financial statements. The relative rigour of Barbadian auditing standards was reflected in the World Economic Forum’s Global Competitiveness Report, in which Barbados was rated highly at 17th in the world (out of 144 countries) for the strength of its auditing and reporting standards. This placed it substantially above the other Caribbean nations (with Jamaica in 32nd place and Trinidad and Tobago in 91st place).
The Institute of Chartered Accountants of Barbados (ICAB) regulates and represents the profession. In April 2012 it listed over 180 members who were entitled to hold practicing certificates. It is a member group of the Institute of Chartered Accountants of the Caribbean (ICAC), which strives to establish the accountancy profession as compliant with internationally instituted standards of professional and commercial practice. It is responsible for developing and implementing professional examinations. This occurs in accordance with the Association of Certified Chartered Accountants of the United Kingdom (ACCA), with which ICAC has entered into a joint examination scheme. Alternatively, individuals can register as students of the Certified General Accountants of Canada (CGA) and the Society of Management Accountants of Canada, or another professional body approved by the Council. Individuals may enter into professional accountancy training with a certain standard of secondary school education.
Income tax rates on Barbados range from 20% for incomes up to 24,200 Barbados dollars, to 35% over that amount (for the tax year 2010-11). Expatriates working in the International Business and Financial Services Sector sometimes qualify for a tax exemption between 35% to 60%, depending on level of income, for an initial period of three years. Corporate tax is taxed at a flat rate of 25%. This is applied to resident companies on their worldwide income, whilst non-resident companies pay tax only on Barbados source income. A company is considered resident if it is centrally managed and controlled in Barbados. There are numerous tax incentives provided for IBCs (International Business Companies), ISRLs (Societies with Restricted Liability), qualifying insurance companies and entities incorporated under the International Financial Services Act. This includes tax on income on a sliding scale, ranging from 1% to a maximum of 2.5%. Onshore insurance companies are charged on the level of business they make, which at most is 5% of gross premium income. Offshore insurance companies are not liable to any tax. Value Added Tax (VAT) is generally charged at 15%, although a reduced rate of 7.5% applies to hotel accommodation.