Brunei Darussalam

Taxable period

Brunei adopts the preceding year basis of taxation for all sources of income. For example, if you are calculating taxes for the year of assessment 2025, the income that is assessed will be for the period/year ending 2024.

Tax returns

Estimated chargeable income (ECI)

A company is required to submit its ECI to the Collector of Income Tax within three months after the end of the accounting period relating to that year of assessment.

Income tax return

Income tax returns are a company’s declaration on their income or profit for a period of 12 months. It is required to be filed and paid by 30 June of the relevant year of assessment.

A complete return shall be submitted together with the supporting tax computation, audited financial statements, and other relevant supporting documents.

Effective year of assessment 2022, general ledger and tax schedules must be submitted in the format specified by the Ministry of Finance and Economy (MOFE) as part of the requirement for submitting a complete tax return.

Payment of tax

Estimated chargeable income (ECI)

Tax on the basis of ECI shall be paid on or before the due date for furnishing ECI (i.e. within three months after the end of the accounting period relating to that year of assessment).

Income tax

Tax on the basis of income tax returns shall be paid on or before 30 June.

Additional assessment

Tax on the basis of additional assessment raised by Revenue Division shall be paid within 30 days after the service of the Notice of Assessment.

Offences and penalties

If a company fails to submit its income tax return by 30 June, it is guilty of an offence under the tax rulings and liable to conviction, to a fine of BND 10,000, and in default of payment to imprisonment for 12 years.

If any tax is not paid within the period as prescribed in the tax rulings for tax due based on ECI, income tax, and additional assessment:

• a penalty of 5% of the amount due will be imposed, and
• if the amount of outstanding tax is not paid within 60 days of the imposition of 5% penalty, an additional 1% penalty is chargeable to the tax payable, and it will not exceed 12%.

Tax audit process

A tax audit is conducted by examining a taxpayer’s accounting books, business records, and financial affairs to verify that the right amount of income has been declared, the right amount of tax has been calculated and paid, and the income tax returns submitted are in compliance with the tax laws and regulations.

The Revenue Division, MOFE would carry out a desk audit and field audit.

Desk audit

A desk audit is to be held at the Revenue Division’s office. Desk audits are normally concerned with tax matters or adjustments that can be dealt with via correspondences. A taxpayer may be called for a meeting or discussion at the Revenue Division’s office if further information is required.

Field audit

A field audit takes place at the taxpayer’s premises, which involves the examination of the taxpayer’s accounting books, business records, and financial affairs. The taxpayer will be given an official notice prior to the commencement of a field audit.

Statute of limitations

The statute of limitations is generally six years. Initially, a tax audit typically covers one year of assessment, but it can be extended to encompass up to six years, pursuant to the issues uncovered during an audit. This six-year limitation, however, does not apply in cases involving tax evasion or fraud, whether deliberate or unintentional, where authorities may audit beyond this period.

Topics of focus for tax authorities

The tax authority is focusing its compliance efforts on the following:

• The timely filing of corporate tax returns.
• Claiming of private or non-deductible expenses.
• The classification of income and expenses for income taxable at concessionary and prevailing corporate tax rates.