Thinking beyond borders
As of 2017 the income tax levies the territorial income of the resident taxpayer, nonresidents are subject to income tax from Honduran source.
Individuals that had remained for more than three (3) months in the country are considered residents therefore are obliged to pay income tax. Individuals receiving income from a single source are not obliged to file a tax return to the tax authorities when their tax is withheld by the employer.
Every individual resident or not resident in the country, receiving any form of income from Honduran source.
Any kind of yield, gain, profit, rent, interest, proceeds, profit, participation, salary, wage, fee and generally any perception in cash, securities, credit or kind that modifies the equity of the taxpayer is considered income.
The calculation of the income tax for individuals shall be done according to the following tax rate table:
Nontaxable incomes for individuals:
Deductible expenses for individuals:
It is considered as residents in Honduras when the individuals have remained in honduran territory for more than three (3) months in the calendar year that corresponds to the tax, besides of the cases that the residence is determined by any other legal disposition.
Nonresidents with agent or accredited representative in Honduras shall be considered as resident for purposes of application of the income tax, for the revenues obtained from the operation performed within the Republic’s territory.
Nonresidents shall be subject to income tax upon revenue obtained from source within the country, whether derived of existent goods in Honduras, of services rendered in national territory or abroad, or of business performed by a resident in the Republic, although the corresponding revenue to such income would be paid or credited to the individual by residents or nonresidents.
Individuals who temporarily remain in the Republic and perform acts of any kind or provide services that produce taxable income shall submit a tax return before leaving the country and request the payment of it. The “Dirección Ejecutiva de Ingresos” (DEI Tax Authority) shall immediately proceed to determine the tax liability according to the following:
Gross income obtained from Honduran source by nonresident individuals or legal entities, shall pay pursuant to the tax rate detailed as follows:
|1||Lease of real property and movable goods, except those mentioned in numerals 5 and 7 of this article||25%|
|2||Royalties from mining and any other natural resources operations||25%|
|3||Wages, salaries, commissions or any other compensations for services supplied whether within the national territory or out of it, excluding remittances||25%|
|4||Income or profit obtained by foreign entities through branches, subsidiaries, filial, agencies, legal representatives and any other that operates in the country||10%|
|5||Income, profit, dividends or any other form of participation on profits or reserves of individuals or legal entities||10%|
|6||Royalties and other amounts paid for using patents, design, procedures and secret formulas, trademarks and author rights except those indicated in numeral 12.||25%|
|7||Interest upon commercial operations, bonus, securities and any other kind of liabilities||10%|
|8||Income for the operation of aircrafts, ships, and ground vehicles||10%|
|9||Operation incomes of communication entities, use of software, software solutions, telematics and other of the telecommunication area||10%|
|10||Insurance and bond premiums of any kind of contracted policy||10%|
|11||Income derived from public entertainment events||25%|
|12||Movies and videotapes for theaters T.V, video club, cable TV rights||25%|
|13||Any other income not mentioned above||10%|
|Type of Contribution||Employee Rate||Employer Rate|
Welfare Insurance Regime,
Collective Capitalization Pillar
Colectivo (Regimen del Seguro
de Prevision Social, Pilar de
Health Care Insurance Regime
(Regimen del Seguro de Atencion
a la Salud RSAS)
|Monthly Maximum Salary For||HNL8,910.71
Monthly Maximum Salary For
There are no reciprocal agreements.
Every taxpayer is required to submit to the Tax Authorities by himself or through an agent or legal representative, from January 1 to April 30 or next business day of each year, a tax return of the income obtained from one or more sources in the previous year. The individuals receiving income that does not exceed 152,557.15 Lempiras are exempt of submitting this tax return.
The employer is obliged to withhold the income tax and submit the corresponding tax return when the employee receives income from a single source.
If the employee is a non-resident or not domiciled in the country the income received from Honduran source will be subject to the rates. The person performing the payments is obliged to withhold, file and pay the amounts to the tax authorities no later than the ten (10) subsequent days of the following month.
The employer is obliged to perform a monthly withhold for the social security payment to the employee recorded in a payroll the amounts withheld must be filed and paid to the corresponding entity.
In Honduras there are no double taxation treaties in force.
Specific Permanent establishment regulations became in force since January 1st 2014.
Transfer pricing regulations became in force since January 1st 2014.
In order to work in Honduras the non-residents must have a work permit.
© 2018 KPMG Impuesto y Asesoría, S.A., a Honduran corporation and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved.