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Jamaica
Corporate - Significant developments
Last reviewed - 12 August 2025Reduction in withholding tax on dividends paid to non-residents
Historically Jamaica imposed high levels of withholding tax (WHT) on dividends paid to non-residents: 25% for non-resident individual shareholders and 33⅓% in the case of non resident corporate shareholders. Combined with income tax at the corporate level, this resulted in an effective rate of up to 50% on distributed profits in the absence of any tax treaty protection. This high composite rate acted as a deterrent to overseas investors (particularly from non-treaty jurisdictions).
With effect from 1 April 2025, the rate of WHT on dividends paid to non-residents (whether individuals or companies) has been reduced to 15%. (subject to any additional treaty protection). This measure also harmonises the rate of WHT on portfolio dividends paid to resident and non-resident shareholders.
Temporary Enhancement of Capital Allowance Rates
With a view to boosting capital investment in the productive sector in 2025 and 2026 the Government of Jamaica has modified the capital allowances (i.e. tax depreciation) regime on a temporary basis by granting enhanced capital allowance rates on eligible capital expenditure incurred in this two-year period. Eligible expenditure incurred before or after this two-year period will continue to be granted capital allowances at the regime's normal rates.
These normal and enhanced capital allowance rates are highlighted below:
| Category of capital expenditure/asset | Initial Allowance (IA) (Year 1) |
Special Allowance (Year 2) |
Annual Allowance (AA) (Straight-Line Annually) |
| Industrial buildings & structures (various rates - depends on primary construction material) |
Normal - 20% Enhanced - 30% |
Normal - 0% Enhanced - 25% |
Normal: 4% to 12.5% Enhanced: 5.5% to 20% |
| Non-industrial buildings & structures (various rates - depends on primary construction material) |
Normal: 0% Enhanced: 12% to 36.5% |
Normal: 0% Enhanced: 8% to 24% |
Normal: 4% to 12.5% Enhanced: 5% to 20% |
| Plant and Machinery (various - depends on type/ purpose of plant & machinery) |
Normal: 0% to 25% Enhanced: 20% to 40% |
Normal: 0% Enhanced: 0% |
Normal: 12.5% to 20% Enhanced: 25% to 33⅓% |
Reform of large-scale projects & pioneer industries regime
In May 2025 the Government of Jamaica repealed and replaced the Income Tax Relief (Large-Scale Projects & Pioneer Industries) Act with the Large-Scale Projects & Pioneer Industries (Tax Relief) Act along with supporting Regulations in order to provide a more broad-based framework to be more agile and 'fit for purpose’ to attract eligible investment in large-scale projects and to promote pioneer industries.
Increase in General Consumption Tax (GCT) threshold
With effect from 1 April 2025, the annual turnover threshold for GCT registration was increased from JMD10 million to JMD15 million. This measure is intended to reduce the compliance burden on small and micro businesses to account for and file monthly GCT returns.
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