Barbados Revenue Authority Issues Guidance on Corporation Top-Up Tax Compliance

The clock is ticking for multinational enterprise (MNE) groups required to comply with corporation top-up tax requirements and the Barbados Revenue Authority (BRA) is making sure that they have all of the information needed for them to meet the requirements.

The BRA has issued five guidance notes on its website to help the MNE groups and other stakeholders meet the June 30 compliance deadline.

It “strongly encourages” taxpayers to review these notes thoroughly and seek professional advice where necessary for compliance assistance.

The six-page guidance note on Payment of Top-Up Tax makes clear that there are financial consequences for late payment of the tax, specifically penalties and interest.

“Where a qualifying entity fails to pay domestic top-up tax by the statutory due date, penalties and interest may apply.

Penalty

“A qualifying entity that fails to pay domestic top-up tax; or pays the tax after the prescribed deadline, may be liable to a fixed penalty of $1 000 payable to the [Revenue] Commissioner; and interest at a rate of one per cent per month on the outstanding amount,” the BRA advised.

“Interest accrues monthly on the highest amount of unpaid domestic top-up tax and accrued interest outstanding during the relevant period until the liability is paid in full.”

This latest stage of the process tied to the enforcemennt of the global minimum tax overseen by the Organisation for Economic Cooperation and Development follows Barbados’ recent signing of the Multilateral Competent Authority Agreement (MCAA) for the GloBE Information Return (GIR).

The GIR MCAA enables automatic tax data exchange for the global minimum tax and eases duplicate reporting across member jurisdictions.

The Authority published the notes after stakeholder engagement and seminars, reinforcing its commitment to taxpayer support and compliance.

The new tax regime was introduced through the 2024 Corporation Tax reform and the enactment of the Corporation Top-Up Tax Act, 2024-16.

The top-up tax requires in-scope multinational groups to pay at least a 15 per cent effective tax rate on profits in each jurisdiction where they operate.

Engagement

Revenue Commissioner Jason King welcomed stakeholder engagement and renewed his commitment to supporting taxpayers.

“The introduction of the top-up tax is a significant development in international tax,” he said.