Income is computed in accordance with generally accepted accounting and commercial principles, subject to certain adjustments required by the tax law.
Inventories are generally valued using the first in first out (FIFO), last in first out (LIFO), and weighted-average cost methods.
Capital gains are not generally subject to CIT but may be subject to capital gains tax. See Capital gains tax in the Other taxes section for more information.
The income from dividends is considered ‘other income’, thus non-taxable under the general income tax rates. The dividends for resident individuals or entities are subject to a 10% WHT.
There is a 10% WHT rate applicable on the dividends paid to non-residents as well.
In the first quarter of 2015, the government abolished the double taxation on dividends. Any dividends or distribution of profits that were subject to the corresponding 10% dividend WHT will not be taxed again in case of redistribution.
In principle, stock dividends are also not taxable if considered as a capitalisation of the entity. Any transaction should be specifically evaluated.
Honduran Bank interests are subject to a 10% WHT at the moment the interest is given, when the sum is over HNL 50,000. Interests from abroad are considered as other income. For income tax reconciliation, interest income is considered non-taxable when subject to the 10% WHT.
Royalties are taxed in the same manner as general income if the recipient is a local company or branch. If the recipient is a non-resident, then the application of a WHT will apply.
Deferral and anti-deferral of foreign income are not regulated in Honduras.