Effective from 1 August 2020, subject to certain conditions, a tax deduction will be allowed on loans (inclusive of both principal amount and interest accrued) taken from a licensed financial institution for medical treatment.
As part of the COVID-19 response and effective from 1 April 2020:
- The rule for advance payment of tax for individuals will be relaxed from the current three payments at a rate of 331/3% to nine payments at a rate of 111/9 % due at the end of each month from April 2020 to December 2020, and penalties on estimated tax will also be removed.
- Any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).
- If an individual has a net business loss, the individual’s employment income is reduced by the net business loss in computing the chargeable income, provided that the amount reduced does not exceed 20,000 Fijian dollars (FJD).
- The compulsory Fiji National Provident Fund (FNPF) employer and employee contributions have been reduced to 5% respectively.
The following amendments to the Fiji Income Tax Act (FITA) 2015 and its Regulations are effective from 1 August 2019 unless indicated otherwise:
- Tax losses incurred on or after 1 January 2019 can be carried forward for eight years.
- The withholding tax (WHT) summary should be lodged monthly instead of annually.
- The export income deduction (EID) of 50% has been reinstated from 1 January 2018 and has been extended until 2020.
- The tax rate for redundancy payments of 15% has been repealed. Redundancy payment shall be included in taxable income subject to the normal individual income tax rates.
- Assets costing FJD 1,000 or less may be fully depreciated in the year of acquisition, subject to certain conditions.
- A 200% tax deduction is available on expenses incurred from the importation of filming equipment for film making and audio visual production by a business registered in Fiji.
- Introduction of the Post Production Facility Investment Package.
- Income tax exemption on income from a Public Private Partnership investment for a residential housing development for the term of the partnership, subject to conditions.
The following changes are effective from 1 January 2020:
- 100% of the employer's statutory FNPF contribution paid by the employer has been reinstated as a tax deduction.
- The cash donations exceeding FJD 15,000 (previously FJD 50,000) to a Sports Fund for purposes of sports development in Fiji shall qualify for a deduction of 150%.
Effective 1 April 2020, a 150% tax deduction is available for employer additional contributions paid up to 10% of the total salary paid to the employee.
Tax Administration Act (TAA)
Effective 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).
The following amendments to the TAA are effective 1 August 2019:
- A claim for tax refund is not admissible if the taxpayer has failed to lodge a tax return or any document required by law and does not make a claim within three years after yea- end unless the refund is attributable to an error by the tax authority.
- The late lodgement penalty would also apply if any documents required by the tax laws (other than a tax return) are not lodged.
- Tax returns and required documents may be lodged by electronic means.
- Notices may be served by electronic means.
- Lodgement may be made electronically by the due date even if the due date falls on a non-working day.
Value-added tax (VAT)
The supply of residential accommodation is exempt from VAT effective 1 August 2020.
The importation of the following shall not be subject to VAT effective 1 August 2019:
- Hybrid and electric charging vessels.
- Ships for coasting-trade.
Environment and climate adaptation levy (ECAL)
The following amendments to the ECAL Act are effective from 1 August 2020:
- ECAL is reduced from 10% to 5% on prescribed services, income, imported white goods and imported vehicles;
- The annual gross turnover threshold for ECAL exemption has been increased from FJ$1.25 million to FJ$3 million; and
- ECAL refund is allowed for persons who import goods for the purposes of re-export based on specific conditions.
The following amendments to the ECAL Act are effective from 7 July 2019 unless indicated otherwise:
- ECAL on plastic bags will increase from FJD 0.20 to FJD 0.50 effective from 1 January 2020.
- ECAL shall be applicable on the importation of the following goods:
- Hybrid vehicles.
- Smart phones.
- Air conditioners.
- Refrigerator and freezers.
- Clothes washers and dryers.
- Dish washers.
- Electric stoves.
- Microwave ovens.
- Electric lawn mowers.
- Hair dryers.
- Electric kettles.
Effective from 1 August 2020, the Stamp Duty Act will be repealed however any document which is executed or takes effect before 1 August 2020 remains subject to stamp duty.
Effective from 1 April 2020 and for the period commencing on and from 1 April 2020 to 31 December 2020, stamp duty exemption applies on:
- any mortgage, except the transfer or assignment of a mortgage and, for the avoidance of doubt, where stamp duty payable on any other instrument is as per the like duty for a mortgage, the exemption in this sub paragraph does not apply to such instrument, and
- any air waybill for any goods, merchandise, or effects to be exported from Fiji.
Offshore loans shall be exempt from stamp duty, provided the funds are deposited into a bank account in Fiji.