Norfolk Island tax system- taxation of Norfolk Island companies and individuals: VAT, income tax and capital gains. Tax treaties of Norfolk.

Taxes of Norfolk

30%

Сorporate tax

30%

Capital gains tax

VAT

30% (dividend), 10% (interest), 30% (royalty)

Withholding tax

Exchange control

Basic taxes (briefly)

Personal tax

0-45%

Corporate tax (in detail)

The standard income tax rate is 30%. There is a reduced rate of 25%

Capital gains tax. Details

Capital gains tax does not apply to assets on Norfolk Island owned by Norfolk Island residents prior to October 24, 2015

VAT. Details

Goods and services tax does not apply to transactions on Norfolk Island

Other taxes

Payroll tax, property tax, etc. Luxury car tax, wine tax, and fuel tax exemptions do not apply to transactions on Norfolk Island

Government fee

Stamp duty

Yes

On July 1, 2016, Australian tax and pension laws came into effect for residents of Norfolk Island

Personal Income Tax

Australian tax residents pay income tax generally on their worldwide income, while non-residents pay income tax on income from sources in Australia.

Income tax is levied on a progressive scale. For tax residents of Australia there are the following tax rates:

on income up to AUD 18 200 - 0%;
on income between AUD 18 200 and AUD 45 000 - 19%;
on income between AUD 45 000 and AUD 120 000 - 32.5%;
on income between AUD 120 000 and AUD 180 000 - 37%;
on income over AUD 180 000 - 45%.

Corporate tax

Australian companies pay tax on their worldwide income; foreign companies pay tax on income from sources in Australia.

The rate of corporate income tax is 30%.

Capital gains tax

Capital gains tax does not apply to assets on Norfolk Island owned by Norfolk Island residents prior to October 24, 2015.

Withholding tax

No tax is withheld from dividend payments to non-residents unless they are paid out of profits on which no income tax was paid. In the latter case, the withholding tax rate is 30%.

The withholding tax rate is 30% for royalties, 10% for interest.

Tax can be withheld on payment of some other types of income.

Tax rates can be reduced in accordance with double taxation avoidance agreements (DTAs).

GST

Tax does not apply to transactions on Norfolk Island.

Other taxes and duties

Luxury car tax, wine tax, and fuel tax exemptions do not apply to transactions on Norfolk Island.

International tax treaties

Norfolk has no separate double tax treaties because it is represented as part of Australia in the tax treaties concluded by Australia.

Australia has 48 Double Tax Treaties (DTC) with the following jurisdictions:

48 DTCs: Argentina, Austria, Belgium, Canada, Chile, China, Czech Republic, Denmark, Fiji, Finland, France, Germany, Hungary, Iceland, India, Indonesia, Ireland, Israel, Italy, Japan, Kiribati, Korea (Republic of), Malaysia, Malta, Mexico, Netherlands, New Zealand, Norway, Papua New Guinea, Philippines, Poland, Portugal, Romania, Russian Federation, Singapore, Slovak Republic, Slovenia, South Africa, Spain, Sri Lanka, Sweden, Switzerland, Taipei/Taiwan, Thailand, Turkey, United Kingdom, United States, Vietnam.

Australia signed and ratified the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). The Multilateral Convention entered into force for New Zealand on January 1, 2019.

On June 3, 2015, Australia signed the Multilateral Competent Authorities Agreement on Automatic Exchange of Financial Account Information under the Common Reporting Standard (CRS MCAA), under which Australia receives information from its financial institutions and automatically exchanges this information with other jurisdictions on an annual basis. The automatic exchange began in September 2018.