Bahamas Encourages SMEs To Use Flat Rate Regime
by Mike Godfrey, Lowtax.net, Washington
17 June, 2015
The Bahamas Value Added Tax (VAT) Department is encouraging small business owners to use the Flat Rate Scheme to simplify their affairs.
The Flat Rate Scheme allows the taxpayer to pay VAT at a fixed rate of 4.5 percent on their taxable turnover, instead of using the traditional system of setting input tax off against output tax.
To qualify for the Flat Rate Scheme, the taxpayer must have an annual taxable turnover of USD400,000 or less and keep the necessary documentation to support sales figures.
Under this scheme, taxpayers cannot claim as input tax the VAT incurred on purchases or on imports except on capital items used in their business.
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