Jamaica

Individual - Other tax credits and incentives

Last reviewed - 19 August 2020

Employment tax credit (ETC)

The ETC is a non-refundable tax credit that is available to tax-compliant employers, including individuals, in computing their income tax liability.

ETC is capped at 30% of the income tax payable on profits from business operations. With a headline income tax rate of 25%, the tax credit therefore provides tax-compliant individuals with an opportunity to reduce the effective income tax rate on their trading profits to as low as 17.5%.

The ETC may not be claimed against any income tax chargeable on non-trading income (e.g. passive investment income) nor can it be claimed in the year of assessment where the taxpayer incurred a tax loss on business operations. The amount must be utilised in the year that the statutory payments are made. Unutilised amounts are not available to be carried forward or back to be utilised in the other years of assessment.