Despite recent strong growth, Seychelles has a variety of economic, social, and environmental concerns, including climate change, economic diversification, population aging, inequality, and improvements in public service quality. Many of these issues will put further strain on government finances. Seychelles is also contemplating large public investments to improve infrastructure and strengthen climate change resistance. As a result, the Seychelles government would most certainly need to raise additional money in the medium to long term. Because alternative sources of financing, such as public debt and development aid, are limited, strengthening the tax system will be especially vital.
The Seychelles Revenue Commission (SRC) is the local authority responsible for the administration and collection of tax revenues.
VAT
VAT (Value Added Tax) is a consumption tax applied in Seychelles on the sale of goods and services.
Except for goods and services exempted in S.I. 71 of 2021 of the VAT (Amendment of Schedules) Regulations, 2014, and further amended by S.I. 33 of 2018, VAT is levied at the point of entry and charged at the point of sale.
Businesses having taxable supplies of more than SCR 2 million will be required to pay VAT.
Rates
- 0% standard rating for goods and services consumed in Seychelles
- 15% for goods and services not consumed in Seychelles
While businesses are exempt, registration for VAT is automatic when several business operations are registered under one TIN. If one of the enterprises is VAT registered, for example, the other company’s activity will be automatically VAT registered as well.
Immovable Property (Foreign Own) Tax
Non-Seychellois who own Immovable Property (e.g. apartments, condominiums, and villas) for residential use alone are subject to the Immovable Property Tax. The tax rate is 0.25 percent of the property’s market value.
Income And Non-Monetary Tax
Taxes under this category are in two forms which are:
Progressive income tax
Employees’ gross emoluments, for example, are subject to progressive income tax (salary, allowances). Even if the gross emoluments are less or below the free threshold of SCR8, 555.50, the employer must submit payroll monthly, regardless of the number of employees.
- From 0 to 8,555.50, the rate for citizens is 0% while non citizen is 15%
- From 8,555.51 to 10,000, the rate for citizens is 15% while non citizen is 15% too.
- From 10,000.01 to 83,333, the rate for citizens is 20% while non citizen is 20%.
- From 83,333 and above, both citizens and non-citizens pay 30%.
Taxation of non-monetary benefits
Any advantage offered to an employed person in exchange for or regarding the performance of work, including a right, privilege, service, or facilities that are to be provided under an agreement for or concerning the performance of work, is referred to as a non-monetary benefit (e.g. motor vehicle, accommodation). According to the Fourth Schedule of the Income & Non-Monetary Benefits Tax Act, 2010, tourism and construction firms are excluded from this tax.
Except for benefits that are exempted under the same schedule of this act, the tax on non-monetary benefits is paid by the employer, and the appropriate tax rate is 20% of the value as indicated in the Third Schedule of the Income & Non-Monetary Benefits Tax Act, 2010.
Business Tax
According to the Business Tax Act- Amendment 2021, business tax is charged on taxable income, which is assessable income less any permissible deductions, save for those exempted in the Second Schedule.
According to SI 108 2021 – Business Tax (Amendment of Schedules) Regulations 2021, business tax is imposed at varying rates based on whether the business is a sole trader, a company, or a partnership, as well as other activities. (As of January 2022, the business tax rates are in effect.)
- 15% on the first SCR 1,000,000 of taxable income for a company.
- 0% on SCR 0 to SCR 102,666 of taxable income for a sole trader.
- 25% on SCR 1,000,001 and above of taxable income for a company.
- 15% on SCR 102,667 to SCR 1,000,000 of taxable income for a sole trader.
- 25% on SCR 1,000,001 and above of taxable income for a sole trader.
