The key tax consideration for Aruba will be whether the business traveller is a resident or not. If the business traveller is a resident: whether the ex-patriate regulation - which provides in a favourable income tax regime for ex-patriates - would apply.
The individual’s liability to income tax is determined on the basis of residence. There are two possibilities: 1) resident or 2) non-resident but receiving specific Aruban source income. The tax is based on the net income and calculated against a progressive rate.
The individual’s liability to income tax is determined on the basis of residence. The residence will be determined by circumstances and the main question is: “where has the individual it’s centre of life”.
If the employer of the business traveler is a resident of Aruba or is a branch or permanent establishment in Aruba, there may be a liability for wage tax.
If the individual qualifies as a resident for the Aruba Income Tax Act, tax should be paid over income from real estate, movable assets, business and labour, and rights from periodic payments. If the individual is a non-resident, Aruba calculates source taxes on specific income like employment income earned in Aruba, unless a treaty provides otherwise.
The progressive tax rates in the income tax are as follows:
|Number||Income brackets||Rate group 1||Rate group 2|
There is a liability for the AOV (general old-age insurance), the AWW (general widows and orphans insurance) and the AZV (general health insurance), unless a treaty provides otherwise.
|Employee||Employer||Total||Employee||Employer||Total||Maximum premium base|
|AZV||Total rate||Surcharge employer||Maximum premium income||Maximum premium|
If income tax is due exceeding wage tax withheld with any, income tax declaration to the inspectorate of taxes is obligatory.
Payment of the levied taxes by the employer at declaration within fifteen days after the end of the period is obligatory.
BRK (Tax regulation for the kingdom of the Netherlands). Aruba also has several tax information exchange agreements (TIEAs) with other countries.
If the business traveller works for a permanent establishment in Aruba, the employer is obliged to withhold wage tax.
BBO 1,5% and 2% health levy (the rate of the health levy has increased from 1% to 2% as of July 8th, 2015)
The arm’s length principle is applicable on all transfer pricing between affiliated companies with regard to all mutual legal relations (e.g. management fees, remunerations for services provided, etc).
Work permit required/Visa required
Yes, by Central Bank of Aruba
Workspace, personal care etc
As businesses become global, few organizations seem to understand the risks that business travel may bring.
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