Seychelles

Basic taxes (briefly)

Personal tax 0-30%
Corporate tax (in detail) For companies, tax rates are: taxable income up to SCR 1 million - 25%; over SCR 1 million - 33%.
Capital gains tax. Details Gains on the sale of assets are taxed at the normal corporate tax rate.
VAT. Details GST is levied at 7% and 10% rates, 15% applies to telecommunications services.
Other taxes Social contributions, Property taxes
Government fee
Stamp duty 1-12,5%.

International tax agreement

   


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TAXES

General Info

In Seychelles, taxation is based on territorial principle.
The income is taxed if it was derived from a source in Seychelles, unless such income is exempt. Any income received by an offshore entity is deemed exempt. Thus, tax exemption applies to: international business companies, offshore banks and insurance companies, trusts, shipping companies and ship owners, mutual funds, foreign employees. Fully exempt from taxation are branches of foreign companies registered in Seychelles, which are engaged in offshore activities, and foreign IBCs, if they choose to be continued under Seychelles IBC Act 1994. Such companies may also import office furniture and equipment, required for carrying their business in Seychelles, free from customs duties.
Seychelles offshore entities are exempt from capital gains, distributions, wealth, gift or inheritance taxes, as well as from stamp duty on sale, transfer of any assets or of shares and on any documents to be executed and registered in Seychelles.
SITZ companies are subject to the same tax exemptions as the offshore entities.

Personal tax

Income taxes in Seychelles are levied on all income, including that of domestic and foreign individuals and companies working in Seychelles. The tax is a flat rate of 15% for both employers and employees.

Corporate tax

Resident and non-resident businesses are liable to pay business tax on their income derived from the Seychelles.
Exempt are the following types of income:
  • the proceeds of rental properties other than dwellings;
  • profits from dealing in or selling property;
  • royalties;
  • fees and commissions in respect of the sale of property or the processing of money loans;
  • lease premiums;
  • income on which a final withholding tax has been levied.

Business Tax is payable in three ways:
  • Provisional Tax – Monthly: Business tax paid in advance at a fixed monthly installment and designed to relieve taxpayers from the burden of a large tax bill at the end of the tax year;
  • Provisional Tax – Deduction at Source: collected on a pay as you earn (P.A.Y.E.) basis and applicable mostly to businesses in construction;
  • Per annum following the assessment of Business Tax returns.

The rates of Business tax depend on a type of entity.
Tax rates for sole traders and partnerships:
Income Rate
The first 150,000 0%
151,000-1,000,000 18.75%
Above 1,000,000 33%


Tax rates for companies and trusts
Income Rate
The first 1,000,000 25%
Above 1,000,000 33%

IBCs are exempt from business tax.

Capital gains tax

There is no capital gains tax in Seychelles.

VAT

VAT has replaced GST since 1Januare, 2013, and is levied upon almost all goods and services that are imported, bought and sold for use or consumption in Seychelles.
Registration for VAT is required, if company’s turnover exceeds a VAT threshold of SR 5 million. A person whose annual turnover is below the VAT threshold may however decide to voluntarily register.
There are two VAT rates: 15% (standard rate) on most supplies of goods and services, and 0% (zero-rate) on a specific list of transactions (principally exports but also a supply of goods by an individual farmer or fisherman and public utilities).

Withholding tax

Withholding Tax is paid on certain types of payment to non-residents at the following rates:
Type of Income Rate
Dividends 15%
Royalties 15%
Interest 0-33%

Other taxes and duties

Trades Tax is a tax generally levied on imported goods into the Seychelles.
Excise Tax levied on cigarettes or tobacco, alcohol, motor vehicles, petroleum products goods imported or locally manufactured in Seychelles.
Presumptive Tax levied on small businesses with an annual turnover that is below SR 1 million at rate of 1.5%.
Corporate Social Responsibility Tax levied on entities at 0.5% of monthly turnover.
Social Security Contribution monthly contributions to Social Security Board at rate of 2.5% for employee and 20% for employer.

Tax incentives

There are incentives granted to investors in the tourism sector and in the agriculture sector. Incentives are also granted in the industries, artisan and fisheries sectors. Most of these incentives provide Trade Tax concessions, VAT concessions, Business Tax concessions, Social Security concessions, etc.

Stamp duty

Stamp duties are imposed by the Stamp Duty Act of 1976 (Chapter 226) and are payable in respect of instruments related to anything situate or performed or done within Seychelles. Standard rate is 5%.
Offshore Entities are exempt.

Government fee

Seychelles companies are renewed annually. For most International Business Companies, this Government fee stands at $100 per year. The actual amount of the Government fee depends on the amount of the authorized capital of the IBC, as follows:
Capital Amount, $ Government Fee, $
Less than 100,000 100
More than 100,000 1000

The amount of fees is fixed for the life of an IBC.

Foreign exchange control

There are no exchange controls in Seychelles. All restrictions on the trading of the Seychelles rupee were removed in November 2008 under an IMF-sponsored economic stabilization program.

ACCOUNTS

Adoption and coming into force of IBC (Amendment) Act (2011)

According to International Business Companies Act (1994), IBCs are obliged to keep such accounts and records as the directors consider necessary or desirable in order to reflect the financial position of the company. Acccoutns and records should be kept at registered office or other place as directors think fit.
In compliance with a new IBC (Amendment) Act came into force in December, 2011, there is a whole new range of requirements to the accounting records.

Requirement to keep accounting records

According to the new IBC (Amendment) Act (2011), every IBC registered in Seychelles should keep proper accounting records that:
  • are sufficient to show and correctly explain company’s transactions;
  • enable to determine the financial position of the company with reasonable accuracy at any time;
  • enable to prepare accounts;
  • give a true and fair view of the company.

Accounting records shall be kept at the registered office of the company or such place as the directors think fit. Where the accounting records are kept at a place other than the registered office, the company shall inform the registered agent in writing of the physical address of that place. If the place is changed, the company should within 14 days inform the registered agent in writing of the change of the physical address.
All accounting records shall be maintained and retained for a period of not less than 7 years.
Notably, there is no requirement to file annual financial statement for IBC.

Sanctions

A company and director, who knowingly fails to comply with the new requirements, are liable to pay a penalty of US$25 for each day for non-compliance.

Changes in business practice of registered agents in Seychelles

Despite the coming into force of a new amendment, the changes have not been introduced into practice yet. However, registered agents in Seychelles are expected to start requesting for the resolution of directors on the address of the other place of keeping the records in case it is not the registered office.

Annual Return. Adoption and coming into force of IBC (Amendment) Act (2013)

Generally speaking, Annual Return is a short review on the current state of the company, which is prepared by the company secretary annually. As a rule it includes the following information:
  • Incorporation information (registration date, registered address);
  • Information about directors and their resignation;
  • Information about secretaries and their resignation;
  • Information about registered capital, nominal value of shares and amount of issued shares;
  • Information about shareholders and share transfer.

As for Seychelles, before Seychelles International Business Companies were not obliged to prepare or file Annual Return, but according to IBC (Amendment) Act (2013), every company, whether incorporated prior to or after the commencement of the Act, shall by the 31th day of December of each year furnish to the registered agent a return in the form of a declaration that –
  • The company is keeping accounting records in accordance with the Act and that such records can be made available though its registered agent; and
  • The Share Register located at the registered office is complete and updated.

A company that contravenes this section of the Act shall be liable to a penalty of 100 dollars and to an additional penalty of 25 dollars for each day during which contravention continues. A director of a company who knowingly permits the company to contravene this provision shall be liable to a penalty of 100 dollars and to an additional penalty of 25 dollars for each day during which contravention continues.

Tax returns

There is no requirement for Seychelles IBCs to file a tax return since they are not subject to corporate tax.

    Taxes of Seychelles

    Min. rate for corporate tax 25%
    Capital gains tax Regular Rate
    VAT 7%/10%/15%
    Withholding tax 15%/15%/15%
    Exchange control No
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