Tax Summary

Fiji offers a location for investors intending to set up operations for regional and international markets.

Strategically located in the heart of the South Pacific region, Fiji offers a location for investors intending to set up operations for regional and international markets. Fiji boasts an environment of pristine beauty. Located at the crossroads of the Pacific, Fiji has a mix of cultures of Fijian, Indian, Chinese, South Sea Islanders, and Europeans.

Fiji has two major islands, Viti Levu and Vanua Levu, with its capital city, Suva, situated in Viti Levu. The official languages of Fiji are English, Fijian, and Fiji Hindi. The local currency is the Fijian dollar (FJD).

Endowed with forest, mineral, and ocean resources, Fiji’s economy is one of the most developed among the Pacific island economies, though it remains a developing country with a large subsistence agriculture sector. The major sources of foreign exchange in Fiji are from the tourism industry; sugar, water, and gold exports; and inward remittances from Fijians working abroad.

Corporate income tax (CIT) rates


Headline CIT rate (%)

20

Corporate income tax (CIT) due dates


CIT return due date

Generally, three months after the end of the income year unless an extension is granted by the tax office.

CIT final payment due date

Final payment (i.e. the balance of actual tax payable) is generally due by the tax return lodgement or the lodgement due date (whichever is earlier).

CIT estimated payment due dates

Effective 1 April 2020, nine equal installments due on the last day of the sixth, seventh, eighth, ninth, tenth, eleventh, and twelfth months of the 2020 tax year and the first and second months of the following tax year. Each installment should be 1/9 of the assessed income tax liability for the preceding tax year or the amount of income tax estimated by the person to be payable for the tax year (other than income tax to be collected by withholding).

Personal income tax (PIT) rates


Headline PIT rate (%)

49 (i.e. 20% + 19% SRT + 10% ECAL)

Effective from 1 August 2020, 44 (i.e. 20% + 19% SRT + 5% ECAL). However, the marginal PIT rate for the 2020 tax year is effectively 39.08% due to change in the ECAL rate mid-year

Personal income tax (PIT) due dates


PIT return due date

31 March (unless an extension is granted by the tax office)

PIT final payment due date

Final payment (i.e. the balance of actual tax payable) is generally due by the tax return lodgement or the lodgement due date (whichever is earlier).

PIT estimated payment due dates

Individual deriving only one salary, interest, and dividends: PAYE for salaries; interest WHT deducted at source; no tax on dividends.

Individuals deriving income other than the above:

Effective 1 April 2020, advance tax payments for the 2020 and subsequent tax years are due in nine installments of 1/9 each due on the last day of each month from April to December each year.

Value-added tax (VAT) rates


Standard VAT rate (%)

9

Withholding tax (WHT) rates


WHT rates (%) (Div/Int/Roy)

Resident: 0 / 10 / 5;

Non-resident: 0 / 10 / 15

Capital gains tax (CGT) rates


Corporate capital gains tax rate (%)

10

Individual capital gains tax rate (%)

10

Net wealth/worth tax rates


Headline net wealth/worth tax rate (%)

NA

Inheritance and gift tax rates


Inheritance tax rate (%)

NA

Gift tax rate (%)

NA

NA stands for Not Applicable (i.e. the territory does not have the indicated tax or requirement)

NP stands for Not Provided (i.e. the information is not currently provided in this chart)

All information in this chart is up to date as of the ‘Last reviewed’ date on the corresponding territory Overview page. This chart has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this chart without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this chart, and, to the extent permitted by law, PwC does not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this chart or for any decision based on it.

Corporate - Significant developments

Corporate income tax (CIT)


The following amendments to the Fiji Income Tax Act (FITA) 2015 become effective from 1 August 2020:

  • The debt forgiveness provisions under the COVID-19 response budget have been extended to 31 December 2021.
  • Companies will be allowed to claim Fringe Benefit Tax paid as a deductible expense.
  • 100% of the employer’s Fiji National Provident Fund (FNPF) contribution paid by the employer will be an allowable tax deduction (including amounts paid in excess of the statutory amounts).
  • Effective 1 April 2020, a 150% tax deduction is available for employer additional contributions paid up to 10% of the total salary paid to the employee.
  • A 150% tax deduction will be available for hotels and resorts for amounts paid for any salaries or wages paid for employment of local artists.
  • A 100% tax deduction will be available for cash donation made to a sporting entity recognised by the Fiji National Sports Commission (previously only available for cash donations up to $15,000 made to an “approved sports funds”).
  • Depreciable assets will now be taxed under capital gains tax (CGT) rules and not income tax rules subject to certain conditions.
  • For thin capitalisation purposes, the debt-to-equity ratio has been increased to 3:1. Consequently, a higher amount of tax deductibility in relation to interest expense will be allowed for a foreign-controlled Fiji company.
  • Transfer of assets by a resident individual shareholder to a resident company will not be subject to capital gains tax (subject to certain conditions).
  • The rules for advance tax payments as amended in the COVID-19 response budget (i.e. 9 payments at a rate of 111/9 %) will be made permanent, and the penalty provision on shortfall in estimated advance tax has been suspended for three years.
  • The tax deduction to be accorded to landlords for reduction of commercial rent under the COVID-19 response budget will be extended until 31 December 2021.
  • A 150% deduction of prescribed costs for listing a corporate bond on the South Pacific Stock Exchange. Furthermore, any interest income earned from corporate bonds are exempt for income tax purposes.
  • The depreciation write-off incentive for assets of more than 1,000 Fijian dollars (FJD) but less than or equal to FJD 10,000 under the COVID-19 response budget will be made permanent.
  • The 100% write-off incentive for the construction of a new commercial and industrial building under the COVID-19 response budget will be made permanent.
  • Effective 20 August 2020, a 150% tax deduction will be available for any cash donation made to a fund established by the Fiji government for the 50th independence day celebrations.
  • New incentive packages have been introduced for the following:
    • Investment by private companies in buildings to be used by the Government or an entity approved by the Government; and
    • Subdivision of land for residential or commercial purposes.
  • The Medical Investment Package has been amended as follows:
    • Amended the tax holiday periods and capital investment thresholds for Ancillary Medical Services and Private Hospitals.
    • Amended the Investment allowance tax deduction and capital investment thresholds for Ancillary Medical Services and Private Hospitals.
  • The Residential Housing Development Incentive Package has been amended to include duty concessions on the importation of raw materials, machinery and equipment for the establishment of the housing project.

The following amendments to the FITA 2015 and its Regulations are in response to the COVID-19 pandemic and are effective from 1 April 2020 unless indicated otherwise:

  • Debt forgiveness of any outstanding debt will not be subject to income tax, subject to certain conditions. This will be applicable from 1 April 2020 to 31 December 2020.
  • Thin capitalisation rules will be suspended for borrowings undertaken from 1 April 2020 up to 31 December 2020.
  • A tax deduction will be accorded to landlords for reduction of commercial rent, subject to certain conditions. The reduction refers to the rent payable after 1 April 2020 to 31 December 2020.
  • The export income deduction (EID) has been increased from 50% to 60% for the tax years 2020 to 2022.
  • The rule for advance payment of tax for companies will be relaxed from the current three payments at a rate of 331/3 % to nine payments at a rate of 111/9 %, and penalties on estimated tax will also be removed. The policy will be valid until 31 December 2020.
  • Assets of more than FJD 1,000 but less than or equal to FJD 10,000 may be fully depreciated in the year of acquisition provided the asset is acquired in the period commencing on and from 1 April 2020 to 31 December 2020.
  • Buildings that are used for commercial or industrial purposes, including multi-storey and multi-unit residential buildings, may also qualify for a 100% write-off, subject to certain conditions.
  • The certificate of exemption will be reintroduced for the 5% Contractors’ Provisional Tax.
  • Salary and wages paid to first-time employees (including apprentices and trainees) for the first 12 months of employment qualify for a 300% deduction (instead of 200%), subject to certain conditions. This deduction is available until 31 December 2023.
  • Salary and wages paid to students employed on a part-time basis qualify for a 300% deduction (instead of 200%), subject to certain conditions. This deduction is available until 31 December 2023.
  • Salary and wages paid to disabled persons qualify for a 400% deduction (instead of 300%), subject to certain conditions. This deduction is available until 31 December 2023.
  • A person is allowed a deduction for 300% of the amount of salary or wages paid between 1 April 2020 to 31 December 2020 to an employee affected by COVID-19 and who is required by the Ministry of Health and Medical Services to be quarantined.
  • A 300% tax deduction will be available for cash donation made to the COVID-19 Fund.
  • Processing of new provisional applications for Film Tax Rebate, as well as pending payments, will be suspended until further notice.
  • The hotel short life investment package incentive has been revised to include construction of new hotel with capital investment of FJD 250,000 or more (previously FJD 7 million), subject to certain conditions.
  • The hotel standard allowance incentive has been revised to include existing hotels (previously only applicable to new hotels).

The following amendments to the FITA 2015 and its Regulations are effective from 1 August 2019 unless indicated otherwise:

  • Tax losses incurred on or after 1 January 2019 can be carried forward for eight years.
  • The withholding tax (WHT) summary should be lodged monthly instead of annually.
  • The export income deduction (EID) of 50% has been retrospectively reinstated from 1 January 2018 and has been extended until 2020.
  • The following conditions to qualify for CIT exemption in information and communication technology (ICT) businesses have been repealed:
    • Should employ at least 50 employees.
    • At least 60% of services is exported.
    • Payment of an annual licence fee of FJD 1,000.
  • The minimum capital expenditure to qualify for the modernisation of buildings incentive has been reduced to FJD 250,000.
  • Assets of FJD 1,000 or less may be fully depreciated in the year of acquisition, subject to certain conditions.
  • The Tax Free Region shall include Naboro.
  • The Residential Housing Development Package has been amended as follows:
    • The sale price of at least 15% of the residential units of each storey for the first five storeys should be below FJD 300,000.
    • The subsidy shall instead be a rebate of 7%, 5%, or 3% of the total capital expenditure incurred, depending on the sale price of the units.
    • CIT exemption on income derived from a public private partnership investment for the term of the partnership, subject to certain conditions.
  • The film making and audio-visual incentives have been amended as follows:
    • The tax rebate shall be 75% of the total Fiji expenditure on the film but not exceeding FJD 15 million.
    • 200% tax deduction on expenses incurred for the importation of filming equipment for film making and audio-visual production by a Fiji company.
    • Introduction of the Post Production Facility Investment Package.
  • Introduction of the Warehouse Construction and Retirement Village Incentives and Manufacture of Pharmaceutical Products Investment Package.

The following changes are effective from 1 January 2020:

  • 100% of the employer’s statutory Fiji National Provident Fund (FNPF) contribution paid by the employer reinstated as an allowable tax deduction.
  • The cash donations exceeding FJD 15,000 (previously FJD 50,000) to a Sports Fund for purposes of sports development in Fiji shall qualify for a deduction of 150%.

Tax Administration Act (TAA)


Effective from 1 April 2020, penalties for failure to file a tax return or other document by the due date will be waived if that due date falls between 31 March 2020 to 31 December 2020 as long as they are lodged by 31 December 2020.

The following amendments to the TAA are effective 1 August 2019:

  • A claim for tax refund is not admissible if the taxpayer has failed to lodge a tax return or any document required by law and does not make a claim within three years after year-end unless the refund is attributable to an error by the tax authority.
  • The late lodgement penalty would also apply if any documents required by the tax laws (other than a tax return) are not lodged.
  • Tax returns and required documents may be lodged by electronic means.
  • Notices may be served by electronic means.
  • Lodgement may be made electronically by the due date even if the due date falls on a non-working day.

Value-added tax (VAT)


Effective 1 April 2020, the importation of medical supplies, such as hand sanitisers, anti-bacterial hand wash, etc, will be exempt from import VAT.

The implementation of the VAT Monitoring System (VMS) as captured in the Electronic Fiscal Device (EFD) Regulations will be deferred to 1 January 2022. The VMS will be applicable on gross turnover of more than FJD 100,000.

Taxpayers who voluntarily register for VAT (that is, those presently below FJD 100,000) will not be captured in VMS.

The importation of the following shall not be subject to VAT effective 1 August 2019:

  • Hybrid and electric charging vessels.
  • Ships for coasting-trade.

Environment and climate adaptation levy (ECAL)


The following amendments to the ECAL Act are effective from 1 August 2020:

  • ECAL has been reduced from 10% to 5% on prescribed services, income, super yacht charter fees, imported white goods, and imported vehicles.
  • The threshold for application of ECAL has been increased from FJD 1.25 million to FJD 3 million.
  • ECAL refund is allowed for persons who import goods for the purposes of re-export based on specific conditions.

The following amendments to the ECAL Act are effective from 7 July 2019 unless indicated otherwise:

  • ECAL on plastic bags will increase from FJD 0.20 to FJD 0.50 effective from 1 January 2020.
  • ECAL shall be applicable on the importation of the following goods:
    • Hybrid vehicles.
    • Smart phones.
    • Air conditioners.
    • Refrigerator and freezers.
    • Televisions.
    • Clothes washers and dryers.
    • Dish washers.
    • Electric stoves.
    • Microwave ovens.
    • Electric lawn mowers.
    • Hair dryers.
    • Toasters.
    • Electric kettles.

Stamp duties


Effective from 1 August 2020, the Stamp Duty Act has been repealed; however, any document that is executed or takes effect before 1 August 2020 remains subject to stamp duty.

Effective from 1 April 2020 and for the period commencing on and from 1 April 2020 to 31 December 2020, stamp duty exemption applies on:

  • any mortgage, except the transfer or assignment of a mortgage and, for the avoidance of doubt, where stamp duty payable on any other instrument is as per the like duty for a mortgage, the exemption in this sub paragraph does not apply to such instrument, and
  • any air waybill for any goods, merchandise, or effects to be exported from Fiji.

Offshore loans shall be exempt from stamp duty provided the funds are deposited into a bank account in Fiji.

Corporate - Taxes on corporate income

Resident corporations are taxed on their worldwide income. Non-resident corporations may only be taxed on their Fiji-sourced income.

CIT is payable and assessed on the chargeable income of the business calculated by subtracting deductible expenses from all assessable income specified under the FITA.

CIT is payable on taxable income at the following rates:

Type of company CIT rate (%)
Non-resident shipping companies in respect of outgoing business from carriage of passengers, livestock, mail, merchandise, or goods embarked or loaded in Fiji 2
Non-resident company that establishes its regional or global headquarters in Fiji (subject to certain conditions) 17
Company listed on the South Pacific Stock Exchange (SPSE) 10
All other companies, including non-resident companies carrying on business in Fiji (e.g. branch profits) 20

Corporate - Corporate residence

A company incorporated, formed, or settled in Fiji is considered a ‘resident’ in Fiji. A company not incorporated in Fiji is resident in Fiji if it has any part of its central management and control located in Fiji.

Permanent establishment (PE)


PE is determined based on the applicable tax treaty. The FITA also defines ‘permanent establishment’ as a fixed place of business through which the business of a person is wholly or partly carried on and includes the following:

  • A place of management, branch, office, factory, warehouse, or workshop, but does not include a liaison office.
  • A mine site, oil or gas well, quarry, or other place of exploration for, or extraction of, natural resources.
  • A building site, construction, assembly, or installation project, or supervisory activities connected with such site or project, but only if the site, project, or activities continue for more than six months.
  • The furnishing of services by the person, including consultancy services, including through employees or other personnel engaged by the person for such purpose, but only if activities of that nature continue for the same or a connected project by the person or an associate for a period or periods aggregating more than six months in any 12-month period.
  • A person, other than an ‘agent’ of independent status, acting on behalf of another person, (referred to as the ‘principal’), if the agent:
    • regularly negotiates contracts on behalf of the principal, or
    • habitually maintains a stock of trading stock from which the agent regularly delivers trading stock on behalf of the principal but does not include an agent of independent status.
  • Substantial equipment other than aircraft, aircraft engines and aircraft parts used for more than six months within a 12-month period or installed by, for, or under contract with the person.
  • The carrying on of activities, including the operation of substantial equipment in the exploration for, or exploitation of, natural resources or standing timber for the period or periods exceeding in aggregate of 90 days in any 12-month period, for or under contract with a person.

However, PE excludes the business of a person that enters into a contractual arrangement solely with the government or persons in which the government has an interest, subject to certain conditions.

This exemption has been removed effective from 1 August 2020. However any exemption granted by the Minister before 1 August 2020 continues to have effect in accordance with the terms and conditions of the exemption.

Corporate - Other taxes

Value-added tax (VAT)


VAT of 9% generally applies on the supply of goods and services in Fiji by a registered person in the course or furtherance of a taxable activity carried on by that person. The threshold amount for VAT registration is FJD 100,000 for the supply of goods and/or services.

The supply of financial services (except for certain insurance services), residential accommodation and education by an approved institution is exempt.

Exports of goods and services and international transportation are zero-rated under certain conditions.

The due date for lodgement of VAT returns and payment of any VAT payable is the end of the month following the taxable period, which is normally a month. However, where an entity’s supplies do not exceed FJD 300,000, it may opt to lodge VAT returns and pay any VAT payable on an annual basis.

Under certain conditions, directors of companies with insufficient funds may be held liable for any outstanding VAT or CIT liability of the company and may be sued in their personal capacity.

Customs duties/import excise taxes


Import excise tax (from 5% to 15%) applies to selected goods (in addition to the fiscal duties imposed on importation), including:

  • Alcohol and tobacco.
  • Used or second-hand liquefied petroleum gas (LPG) powered motor vehicles.
  • New or used licensed mini buses.
  • Some goods that are also locally manufactured.
  • Certain white goods and luxury items.

Excise taxes


Excise tax is payable on tobacco, alcohol products, and carbonated soft drinks manufactured in Fiji, based on quantities produced.

Property taxes


There are no property taxes at the national level. However, the municipalities may charge property rates in their respective areas.

Stamp duties


Under the Fiji Stamp Duties Act, stamp duty is payable in respect of instruments, including, but not limited to, declaration of trusts, leases, loans, mortgages, transfer of property (or interest therein), and shares.

Effective from 1 August 2020, the Stamp Duty Act will be repealed however any document which is executed or takes effect before 1 August 2020 remains subject to stamp duty.

Capital gains tax (CGT)


Capital gains made from the following assets (excluding trading stock, depreciable assets (subject to certain conditions effective 1 August 2020), or business intangibles) may be subject to CGT of 10%:

  • Land or an interest therein.
  • Ships or boats.
  • Yachts.
  • Shares, securities, equities, or other financial assets (except shares listed on the SPSE).
  • Intangible assets.
  • Interest in a partnership or trust.
  • Aircraft.
  • Option, right, or other interest in an asset referred to above.

A capital gain made on disposal of an asset that is used solely to derive income that is exempt from tax under the FITA shall be exempt from CGT. However, the disposal of shares is not exempt from CGT (except shares listed on the SPSE as noted above).

Foreign tax paid in respect of the disposal of a capital asset may be allowed as a tax credit against the CGT payable.

There is no carryforward of capital losses in calculating CGT.

Any gain on the disposal of shares listed on the SPSE shall be exempt from CGT.

Any gain on the disposal of shares in any Unit Trust in Fiji shall be exempt from CGT, subject to certain conditions.

Any gain on the disposal of capital assets (including shares) by a Fiji resident shall be exempt from CGT and CIT where a private company goes through reorganisation, restructure, or amalgamation for the purpose of listing on the SPSE, subject to certain conditions.

Transfer of shares due to corporate reorganisation shall not be subject to CGT, subject to certain conditions. Effective from 1 August 2020, this has been amended to include reorganisation by a resident individual subject to certain conditions.

Service turnover tax (STT) and environment and climate adaptation levy (ECAL)


Effective from 1 August 2020, the Service Turnover Tax Act will be repealed however any transaction entered into and paid before 1 August 2020 remains subject to STT at the rate of 6%.

STT at the rate of 6% is imposed on the turnover of a person conducting a business involving the provision of a prescribed service where the annual gross turnover exceeds FJD 1.25 million, which includes the following:

  • Provision of accommodation, refreshments, and any other services by a hotel.
  • Any services provided in a vessel that is principally or wholly engaged in the carriage of tourists in Fiji.
  • Provision of meals, beverages, and any other services in a bar.
  • Provision of services in a nightclub.
  • Provision of in-bound tour services.
  • Live entertainment provided by artists for a fee.
  • Provision of services for recreational activity for gain.
  • Provision of services relating to exhibition of films to the public or section thereof by an exhibitor where a charge is made for admission, including services provided by cinema operators.
  • Provision of services by hired or rental car operators and chartered transport services to tourists by omnibus or mini-bus operators.
  • Provision of meals, beverages, and any other services by bistros or coffee shops.
  • Provision of meals, beverages, and any other services on sale by restaurants.
  • Provision of charter flight services by an aircraft or helicopter, excluding such services for medical or natural disaster relief evacuation.
  • Provision of all water sports, including underwater activities and river safaris.
  • Provision of accommodation in a private residence or property that accommodates tourists, international students, or overseas visitors who are paying guests.

The above-prescribed services are also subject to ECAL at the rate of 10%. However, non-consumption services by hotel properties are no longer subject to STT (or ECAL).

STT and ECAL shall only be imposed once for the same service.

The following amendments to the ECAL Act are effective from 1 August 2020:

  • ECAL is reduced from 10% to 5% on prescribed services, income, imported white goods and imported vehicles;
  • The annual gross turnover threshold for ECAL exemption has been increased from FJ$1.25 million to FJ$3 million; and
  • ECAL refund is allowed for persons who import goods for the purposes of re-export based on specific conditions.

The following shall also be subject to ECAL:

  • Prescribed plastic bags at 20 cents per bag (50 cents effective from 1 January 2020).
  • Import of new or used vehicles with engine capacity exceeding 3000cc, hybrid vehicles, and certain electrical goods, subject to certain exemptions.
  • Charter of superyachts.

The due date for payment of STT and ECAL is aligned with the VAT Act requirements (i.e. end of the month following the taxable period).

Water Resource Tax (WRT)


The WRT, at the following rates, shall be levied upon the extraction of water in its natural state for sale:

Litres extracted monthly Cents per litre
0 to 9,999,999 1.00
10,000,000 and above 18.00

Fringe benefits tax (FBT)


FBT of 20% is payable by the employer on the grossed-up value of certain fringe benefits provided to employees (the effective tax rate is 25%).

Payroll taxes


Employers are required to deduct and remit monthly to the tax authority appropriate Pay-As-You-Earn (PAYE) tax, social responsibility tax (SRT), and ECAL from employee gross cash emoluments.

If appropriate PAYE taxes, SRT, and ECAL are not deducted and remitted, the tax authority may recover the taxes from the employer or the employee and/or disallow a tax deduction for the expenditure.

Contributions to the Fiji National Provident Fund (FNPF)


The FNPF is a compulsory superannuation scheme for local employees. Under the FNPF Act, employers and employees are required to contribute 10% and 8%, respectively, of cash emoluments of employees to the Fund.

Effective 1 April 2020, the compulsory FNPF employer and employee contributions have been reduced to 5% respectively as part of the government’s COVID-19 response budget. This has been extended until 31 December 2021.

Employers are not required to contribute to the FNPF for expatriate employees. However, if expatriates and their employers wish to contribute to the FNPF, they may elect to do so subject to certain conditions.

Telecommunication levy


Telecommunication levy of 1% is imposed on all voice call charges.

Gambling turnover tax (GTT)


GTT is imposed on the value of consideration paid or payable in respect of the provision of prescribed gambling services (i.e. acceptance of bets and provision of tickets for any lottery) at the rate of 15%.

Corporate - Branch income

The profits of a foreign company’s branch operating in Fiji are subject to the same tax rate as the tax rate levied on profits of a resident corporation (i.e. 20%).

Corporate - Income determination

CIT is payable and assessed on taxable income of the business. Taxable income is calculated by subtracting allowable deductions from all assessable income (i.e. all sources of income).

Inventory valuation


Inventories are normally valued at the lower of cost and net realisable value. While the first in first out (FIFO) method is acceptable, the last in first out (LIFO) method is not, for either book or tax purposes. Conformity between book and tax reporting is not required, and there are no special provisions for valuing inventories or determining inventory flows.

Capital gains


Any profit or gain accrued or derived from the sale or disposal of real or personal property, or any interest therein, shall be subject to income tax when:

  • the business of the company comprises dealing in such property
  • the property is acquired for the purpose of selling or otherwise disposing thereof, or
  • any profit or gain is derived from the carrying on or carrying out of any undertaking or scheme entered into or devised for the purpose of making a profit.

Otherwise, the capital gain may be subject to CGT of 10%.

Dividend income


Dividends are no longer subject to tax in the hands of the shareholders.

Interest income


Interest income derived by a resident from a company shall be appropriately subject to resident interest WHT of 10%, which may be claimed as a tax credit against income tax payable on income. Exempt income shall not be subject to WHT.

Royalty income


Royalty income derived by a resident company or PE may be appropriately subject to contractors’ WHT of 5%, which may be claimed as a tax credit against income tax payable on income.

Royalty income derived by a non-resident company without a PE in Fiji should be appropriately subject to WHT at the rate of 15%.

Partnership income


The income of the partners from a partnership for any income year is equal to each partners’ respective share of income from that partnership. Each partner declares income separately and is individually liable for filing a tax return for each applicable year.

Liability of directors/shareholders


Directors/shareholders of companies in liquidation or with insufficient assets to satisfy tax liabilities may be held liable for any outstanding tax liability of the company, under certain conditions.

Other significant items


Where a foreign-controlled business in Fiji produces less income than might be expected, the revenue authorities may determine the income for tax purposes.

Foreign income


Resident corporations are taxed on their worldwide income. Foreign income derived from a treaty country is taxed according to the treaty. Foreign income sourced from a non-treaty country by a Fiji tax resident is subject to income tax in Fiji. A credit is allowed in Fiji for foreign tax paid on foreign income. The tax credit is limited to the lesser of the Fiji tax payable or the foreign tax paid on such income. There are no special provisions for taxing undistributed income of foreign subsidiaries.

Corporate - Deductions

Generally, expenses wholly and exclusively incurred in deriving assessable income are allowable deductions. Expenditures that are capital or domestic in nature are generally not deductible.

Depreciation and depletion


Depreciation may be calculated on the cost of a business asset on a straight-line or diminishing-value basis. The prescribed rates of depreciation are based on the estimated life of the asset. Upon disposal of a business asset, either recoupment of depreciation claimed is taxable or the excess of tax written-down value over sale proceeds is deductible. The taxpayer has an option to set-off recoupment of depreciation against the cost of replacement assets. Conformity between book and tax depreciation is not required.

There are three broad bands of depreciation rates for assets (other than buildings). The three broad bands and the depreciation rates are as follows:

Band Kind of asset Diminishing value (%) Straight line (%)
1 Motor vehicles; buses and minibuses with a seating capacity of less than 30 passengers; goods vehicles with a load capacity of less than seven tonnes; computers and data handling equipment; and construction equipment and earthmoving equipment 40 25
2 Buses with a seating capacity of 30 or more passengers; goods vehicles designed to carry or pull loads of more than seven or more tonnes; specialised trucks; tractors; trailers and trailer-mounted containers; and plant and machinery used in manufacturing, mining, or farming operations 30 20
3 Vessels, barges, tugs, and similar water transportation equipment; aircraft; specialised public utility plant, equipment, and machinery; office furniture, fixtures, and equipment; and any depreciable asset not included in another category 20 12.5

Certain renewable energy plant and water storage facilities also qualify for a 100% write-off.

Effective 1 April 2020, buildings that are used for commercial or industrial purposes, including multi-storey and multi-unit residential buildings, may also qualify for a 100% write-off, subject to certain conditions.

Capital expenditure aimed at economising on the consumption of fuel, electricity, or its derivatives, or on an asset using energy sources indigenous to Fiji, may be eligible for accelerated depreciation at varying rates.

The cost of the acquisition of a mining lease or tenement and the cost of development of mines may be written off in equal instalments in any five of the first eight years, commencing with the year in which the expenditure was incurred.

Assets of FJD 1,000 or less may be fully depreciated in the year of acquisition.

Effective 1 April 2020, assets of more than FJD 1,000 but less than or equal to FJD 10,000 may be fully depreciated in the year of acquisition provided the asset is acquired in the period commencing on and from 1 April 2020 to 31 December 2020. Effective from 1 August 2020, this incentive has been made permanent.

A deduction for depletion of other natural resources is not available.

Goodwill


Goodwill, and the amortisation thereof, may be deductible for income tax purposes.

Start-up expenses


Start-up expenses are deductible for income tax purposes.

Interest expenses


Interest expenses that are revenue expenditure wholly and exclusively incurred in deriving taxable income are generally deductible in calculating taxable income, subject to the thin capitalisation rules (see Thin capitalisation in the Group taxation section for more information).

Provisions


Provisions for expenses not yet incurred (e.g. bad debts) are not tax-deductible. Deductions are generally permitted in respect to amounts that are actually paid or incurred.

Charitable and other contributions


Contributions to approved academic and charitable organisations of up to FJD 100,000 are deductible.

There are certain other specific donations that qualify for varying levels of deductions, including:

  • Donations to the Fiji Heritage Foundation, which qualify for a deduction of 150%.
  • Donations to Tourism Fiji, which qualify for a deduction of 150%.
  • Cash donations exceeding FJD 50,000 to the Poverty Relief Fund for Education, which qualify for a deduction of 200%.
  • Cash donations exceeding FJD 50,000 (FJD 15,000 effective 1 January 2020) to a Sports Fund (as approved by the CEO of the Fiji Revenue and Customs Service [FRCS]) for purposes of sports development in Fiji, which qualify for a deduction of 150%.
  • Total cost of new computers, laptops, and tablets of not less than FJD 10,000 but not exceeding FJD 100,000 that are donated to urban and rural schools registered with the Ministry of Education, which qualify for a deduction of 150% and 200%, respectively.
  • The following payments qualify for a deduction of 150%:
    • Cash donations of not less than FJD 10,000 but not exceeding FJD 100,000 to the Disaster Rehabilitation Fund.
    • Cash sponsorships of more than FJD 100,000 but not exceeding FJD 200,000 towards the hiring of international sporting coaches.
    • Cash donations not exceeding FJD 50,000 towards any approved housing project for squatters by the Fiji government.
  • A 300% tax deduction will be available for cash donations made to the COVID-19 Fund.
  • Cash donations of not less than FJD 10,000 to the Farmers Disaster Relief Emergency Fund Account, which qualify for a 200% deduction.
  • Effective 1 August 2020, cash donation made to a sporting entity recognised by the Fiji National Sports Commission (previously only available for cash donations up to $15,000 made to an “approved sports funds”) qualify for a deduction of 100%.
  • Effective 20 August 2020, a 150% tax deduction will be available for any cash donation made to a fund established by the Fiji government for the 50th independence day celebrations.

Fines and penalties


Generally, fines and penalties are not deductible for income tax purposes.

Taxes


Taxes levied on income are not deductible. Only 50% (100% effective 1 January 2020) of the employer’s statutory FNPF contribution paid by the employer is allowed as a deduction for tax purposes in the year the contribution was paid.

Employee cost not appropriately subject to Pay-As-You-Earn (PAYE) final WHT is not allowed as a deduction for tax purposes.

FBT was previously not allowed as a deduction for tax purposes however effective from 1 August 2020, companies will be allowed to claim FBT as a deductible expense.

Net operating losses


Tax losses may be carried forward for eight consecutive years (effective for losses incurred on or after 1 January 2019; all other cases four years), provided the company can demonstrate a minimum 51% continuity of shareholding between the year of loss and the year of claim. Notwithstanding the change in ownership, losses may also be carried forward where a company carries on the same business in the carried forward year as it did in the loss year (subject to certain conditions).

In relation to certain private hospitals and medical services businesses, tax losses may be carried forward for eight years.

Loss carrybacks are permitted, but only in very limited circumstances.

Payments to foreign affiliates


Subject to the normal rules of deductibility, a deduction may be claimed for royalties, management service fees, and interest charges paid to foreign affiliates.

Corporate - Group taxation

Group taxation is not available in Fiji.

Transfer pricing


Transfer pricing provisions state that the tax authority may allocate income and expenses between associates (related entities) to reflect income and expenses on an arm’s-length basis.

The Income Tax (Transfer Pricing) Regulations provide that the Organisation for Economic Co-operation and Development (OECD) Transfer Pricing guidelines may be used in interpreting the provisions of the Regulations in determining income or expenses on an arm’s-length basis.

Thin capitalization


If a foreign controlled resident company, other than a financial institution, has a debt to equity ratio in excess of 2:1 at any time during a tax year, interest expense in relation to that part of the debt that exceeds the ratio is not allowed as a tax deduction unless the company can properly substantiate the arm’s-length nature of the debt.

Effective 1 April 2020, thin capitalization rules will be suspended for borrowings undertaken from 1 April 2020 up to 31 December 2020 that result in the debt-to-equity ratio exceeding 2:1. Effective from 1 August 2020, the debt to equity ratio has been increased to 3:1.

Controlled foreign companies (CFCs)


Fiji does not have specific rules in relation to CFCs.

Corporate - Tax credits and incentives

The tax incentives in Fiji are designed primarily to promote export sales and to encourage the development of industries that are considered of benefit to the economic development of Fiji.

Export income deduction (EID)


A deduction for export income is allowed in accordance with the following:

Year of assessment Percentage of export income to be deducted (%)
2018 50
2019 50
2020 60
2021 60
2022 60

‘Export income’ means chargeable income derived by a taxpayer from the business of exporting goods and services but excludes re-exports.

Information and communication technology (ICT) tax incentives


The income of an ICT operator may be exempt from CIT for a period of 13 years from the date of issue of the licence.

The income of the following may be exempt from CIT for a period of 13 years from the date of approval:

  • ICT start-ups involved in application design or software development.
  • Accredited ICT training institutions.

The expenses incurred by the following entities shall qualify for a 150% deduction:

  • ICT start-ups involved in application design or software development.
  • Accredited ICT training institutions.

A company is allowed a 250% deduction for research and development (R&D) expenses incurred in the ICT industry.

Employment incentives


Salary and wages paid to first-time employees (including apprentices and trainees) for the first 12 months of employment qualify for a 200% deduction, subject to certain conditions. This deduction is available until 31 December 2020. Effective from 1 April 2020, the deduction has been increased to 300% and is available until 31 December 2023.

Salary and wages paid to students qualify for a 200% deduction, subject to certain conditions. This deduction is available until 31 December 2020. Effective from 1 April 2020, the deduction has been increased to 300% and is available until 31 December 2023.

Salary and wages paid to disabled persons qualify for a 300% deduction, subject to certain conditions. This deduction is available until 31 December 2022. Effective from 1 April 2020, the deduction has been increased to 400% and is available until 31 December 2023.

Employees’ education fees qualify for a 150% deduction, subject to certain conditions.

Effective 1 January 2019, the cost incurred by an employer providing employee training qualify for a 150% deduction if training providers approved by the FRCS conduct the training.

Effective 1 January 2019, salaries and wages paid to employees taking family care leave qualify for a 150% deduction, subject to certain conditions.

Effective 1 January 2019, salaries and wages paid to employees taking paternity leave qualify for a 150% deduction.

Effective 1 April 2020, a person is also allowed a deduction for 300% of the amount of salary or wages paid between 1 April 2020 to 31 December 2020 to an employee affected by COVID-19 and who is required by the Ministry of Health and Medical Services to be quarantined.

Hotel industry incentives


The existing Hotel Investment Incentive Package will be repealed and replaced with the new Hotel Investment Incentive Package effective from 1 April 2020. The new Hotel Investment Incentive Package will be applicable from 1 April 2020 to 31 December 2022.

The following incentives are available under the new Hotel Investment Incentive Package.

Approved capital expenditure incurred in building, renovating, or expanding a new or existing hotel is subject to an investment allowance of 25% of the approved expenditure, in addition to normal depreciation. Previously, this was only applicable to new hotels.

The short life investment package (SLIP) incentive has been revised to include construction of new hotel or integrated tourism development with capital investment of FJD 250,000 or more (previously FJD 7 million), subject to certain conditions.

Under the new SLIP, the following concessions are available to a company:

  • Exemption from CIT for a period of up to 13 years, depending on the level of capital investment in the hotel.
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.

The recipients of provisional approval for hotel investment tax incentives are required to complete the hotel projects within two years from the date provisional approval is granted.

The incentives are also available for new apartments, subject to certain conditions.

Effective 1 August 2020, a 150% tax deduction will be available for hotels and resorts for amounts paid for any salaries or wages paid for employment of local artists.

Medical industry incentives


Approved capital expenditure incurred in building, renovating, or expanding a private hospital (minimum capital investment of FJD 500,000 effective 1 August 2020, previously FJD 1 million) or ancillary medical centre (minimum capital investment of FJD 500,000) is allowed an investment allowance of 30% or 60% (previously 60%) of the approved expenditure depending on the level of investment, in addition to normal depreciation.

The tax incentive shall also apply to hospitals under Government Private Public Partnerships.

Under the Medical Investment Package (MIP), the following concessions are available to a company:

  • Exemption from CIT for a period of up to 20 years effective from 1 August 2020 (previously ten years), provided that the capital investment in the private hospital or ancillary medical centre is more than FJD 2.5 million or FJD 500,000 from 1 August 2020 (previously FJD 7 million or FJD 2 million), respectively .
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.

Any tax losses incurred by an entity granted approval for the investment allowance or MIP may be carried forward for eight years, but may only be set off against income of the medical business or from the hospital premises.

Residential housing incentives


The following concessions are available to a company developing buildings for residential purposes with a capital investment of more than FJD 2 million and at least 20 residential housing units, subject to certain conditions:

  • Subsidy of 3%, 5%, or 7% (depending on the sale price per unit) of the total approved capital expenditure incurred, in addition to normal depreciation.
  • Duty-free and VAT-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.
  • Effective 1 August 2020, the Residential Housing Development Incentive Package has been amended to include duty concessions on the importation of raw materials, machinery and equipment for the establishment of the housing project.

The recipients of provisional approval are required to complete the projects within two years from the date provisional approval is granted.

Effective 1 August 2019, a company that enters into a Public Private Partnership investment for a residential housing development shall be exempt from CIT for the term of the partnership, subject to conditions.

Electric vehicle charging station incentives


The following concessions are available to a company developing electric vehicle charging stations with a capital investment of more than FJD 100,000 (effective 1 August 2018; previously FJD 500,000):

  • Subsidy of 5% of the total approved capital expenditure incurred, in addition to normal depreciation.
  • Exemption from CIT for a period of seven years.
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.

Filmmaking and audio-visual incentives


A tax exemption or reduced tax rate is available on the income of non-resident employees of an approved non-resident company engaged or intending to be engaged in making a film in Fiji.

As part of the COVID-19 budget announcements, the government has announced that the processing of new provisional applications for film tax rebate, as well as pending payments of film rebate refunds, will be suspended until further notice.

A resident entity (excluding an entity holding a broadcast licence in television or radio in Fiji or with substantial shareholdings in the same) may deduct up to 150% of expenditure on audio-visual production in respect of income in the year of the expenditure. ‘Audio-visual productions’ include production for exhibition or sale of theatrical films, broadcast television, direct-to-video and video disk programme, audio recording, computer software, and interactive websites.

A tax exemption is available on the income derived by a taxpayer from the commercial exploitation of a copyright until the taxpayer has received from the commercial exploitation a return of up to 60% of the expenditure. The expenditure must be of capital nature and in relation to the audio-visual production costs in respect of a qualifying audio-visual production.

Tax concessions are also available for residents of areas declared as studio city zones by the appropriate government minister.

Furthermore, tax rebates of 75% of the company’s total Fiji expenditure on the films or TV commercials but not exceeding FJD 15 million (effective 1 August 2019; previously 47% of total qualifying Fiji production expenditure but not exceeding FJD 28.2 million) are available for local production companies.

Effective 1 August 2019, a 200% tax deduction is available on expenses incurred from the importation of filming equipment for film making and audio-visual production by a Fiji company.

Effective 1 August 2019, the following concession is available to a company that sets up a post-production facility with capital investment of at least FJD 2 million:

  • Exemption from CIT for a period of seven years.
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.

Warehouse construction incentives


Effective 1 August 2019, the following concessions are available to a company in the warehouse business with a capital investment of more than FJD 250,000:

  • Investment allowance of 50% or 100% (depending on the level of investment) of the total capital expenditure incurred (excluding the cost of land), in addition to normal depreciation.
  • Exemption from CIT for a period of five, seven, or 13 years, depending on the level of investment.
  • Duty-free entry of certain raw materials, plant machinery, and equipment, upon receiving provisional approval from the Minister.

Retirement village incentives


Effective 1 August 2019, the following concessions are available to a company constructing a new retirement village with capital investment of at least FJD 250,000 (effective 1 August 2018; previously FJD 500,000):

  • Exemption from CIT for a period of five, seven, or 13 years, depending on the investment level.
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.

Manufacture of pharmaceutical products investment package


Effective 1 August 2019, the following concessions are available to a company that develops a building or buildings for the manufacture of pharmaceutical products with capital investment of more than FJD 250,000:

  • Exemption from CIT for a period of five, seven, or 13 years, depending on the investment level.
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the Minister.

The recipients of provisional approval are required to complete the projects within two years from the date provisional approval is granted.

Tax Free Regions (TFRs)


The following concessions may be available to a newly incorporated entity engaged in trade, business, or manufacture in the TFRs:

  • Exemption from CIT for a period of 5 to 20 consecutive fiscal years for a new activity established between 1 January 2009 to 31 December 2028, depending on the level of investment and the equity held by an iTaukei landowner.
  • Duty-free entry of raw materials, machinery, and equipment (including parts and materials) required for the establishment of the business.

The areas declared TFRs are Vanua Levu, Rotuma, Kadavu, Lomaiviti, Lau, Naboro (effective 1 August 2019), and the airport side of the Rewa Bridge, excluding the town of Nausori up to the Ba side of the Matawalu River (previously Korovou to Tavua).

CIT exemption of 5, 7, or 13 years (depending on the amount of capital investment) is available to a taxpayer engaged in any new activity established in the TFR, subject to certain conditions.

Other tax incentives


An investment allowance of 55% is available for the construction or refurbishment and renovation of a vessel, in addition to normal depreciation, subject to certain conditions.

An approved mining company may, for a specified period, be exempt from CIT or taxed at a lower rate. The holder of a valid prospecting licence may write off approved expenditure on prospecting for minerals against income from all sources.

A 150% deduction is available for direct capital expenditure incurred by commercial banks in rural banking programmes.

Investors engaged in value adding processes in the food processing, agricultural processing, fisheries, or forestry business may be able to claim a 100% deduction with respect to amounts invested or re-invested (for expansion), provided that the businesses meet the 50% local content rule.

A CIT exemption may be available to a taxpayer engaged in the following commercial agricultural farming and agro-processing activities, subject to certain conditions.

Income derived by a taxpayer from a new activity in processing agricultural commodities into bio-fuels established between 1 January 2009 and 31 December 2028 may be exempt from CIT for a period of 5 to 13 consecutive tax years (depending on the level of capital investment), under certain conditions.

An exemption from CIT for a period of five years may be available to a taxpayer engaging in renewable energy projects and power cogeneration.

Entities in the agriculture, fisheries, and tourism industries, with a maximum turnover threshold of FJD 500,000, may also be exempt from CIT.

A 150% deduction is available on expenses incurred in reorganising a company for the purpose of listing on the SPSE.

Any gain derived from the following sale of shares shall be exempt from CIT:

  • For the purpose of listing on the SPSE, subject to certain conditions.
  • By a resident of shares in an SPSE-listed company.

40% of capital expenditure of not less than FJD 50,000 incurred by any existing business located in Vanua Levu is allowed as a deduction for tax purposes, subject to certain conditions.

A 150% deduction is available on expenditure not exceeding FJD 250,000 incurred in marketing goods and services for export to any of the South Pacific countries, excluding Australia and New Zealand.

The income of a shipping company derived from servicing Rotuma and the Lau Group shall be exempt from CIT for a period of seven years, subject to certain conditions.

A 50% deduction is available on expenditure incurred for uniforms made in Fiji and supplied to an employee, provided that the cost is not recovered from the employees.

A 150% deduction is available for foreign companies for capital expenditure incurred for the relocation to Fiji of its regional or global headquarters, which provides management, technical, or other supporting services to its offices or associated companies, subject to certain conditions.

250% deduction is available for companies for R&D expenses incurred in the renewable energy industry.

55% deduction is available for companies for expenditure incurred in investing in electric omnibuses.

A taxpayer who incurred more than FJD 250,000 (effective 1 August 2019; previously FJD 1 million) in capital expenditure for the modernisation of buildings may avail of CIT exemption equal to 25% of the total expenditure incurred, subject to certain conditions.

New incentive packages have been introduced effective 1 August 2020 for the following:

  • Investment by private companies in buildings to be used by the Government or an entity approved by the Government; and
  • Subdivision of land for residential or commercial purposes.

Effective 1 August 2020, a 150% deduction of prescribed costs for listing a corporate bond on the South Pacific Stock Exchange. Furthermore, any interest income earned from corporate bonds are exempt for income tax purposes.

Foreign tax credit


A credit is allowed in Fiji for foreign tax paid on foreign income, limited to the lesser of the Fiji tax payable or the foreign tax paid on such income.

Corporate - Withholding taxes

WHTs are levied as follows:

Recipient WHT (%)
Dividends Interest Royalties Know-how, management fees Professional fees
Resident corporations 0 10 (1) 5 (2) 5 (2) 5 (2)
Resident individuals 0 10 (1) 5 (2) 5 (2) 5 (2)
Non-resident corporations:
Non-treaty 0 10 15 15 15
Treaty:
Australia 0 10 15 15 0/15 (3)
India 0 10 10 10 0/10 (3)
Japan 0 10 10 10 0/10 (3)
Korea, Republic of 0 10 10 10 0/10 (3)
Malaysia 0 10 15 15 0/15 (3)
New Zealand 0 10 15 15 0/15 (3)
Papua New Guinea 0 10 15 15 0/15 (3)
Qatar 0 0 5 5 0/5 (3)
Singapore 0 10 10 10 0/10 (3)
United Arab Emirates 0 0 10 10 0/10 (3)
United Kingdom 0 10 15 15 0/15 (3)

Notes

  1. Applies to interest but is not applicable if income is exempt.
  2. This WHT applies where there is a contract and the payee does not hold a valid Certificate of Exemption.
  3. Depending on the provisions of the applicable double taxation agreement.

Corporate - Tax administration

The Tax Administration Act (TAA) was promulgated with the stated intention of harmonising the administration of the various tax laws, including CIT and VAT. CGT, FBT, STT, and ECAL are also covered by the provisions of the TAA.

If a due date falls on a Saturday, Sunday, or holiday, the due date is the last working day before the due date except when the documents are lodged electronically.

Taxable period


Tax is assessed on income derived during the calendar year preceding the year of assessment. Returns are therefore generally accepted on a calendar-year basis, although approval is also given to use an alternative fiscal-year basis. For purposes of assessment of returns completed on a fiscal-year basis, the calendar year in which more than one-half of the fiscal year falls is deemed to be the calendar year in which the income is derived.

Tax returns


The Fiji tax system is not based on self-assessment. Returns of income contain information on the basis of which assessments are raised by the tax authorities.

The due date for lodgement of CIT returns is three months after the end of the income year. However, under the Tax Agent Lodgement Programme, an extension of time may be granted to lodge the CIT returns.

Payment of tax


Final payment of CIT (i.e. the balance of actual tax payable) is generally due by the tax return lodgement due date.

As part of the Fiji COVID-19 response which became effective from 1 April 2020, the advance tax payments for the 2020 and subsequent income years are required to be made in nine equal instalments.

The due dates for the advance tax payments are as follows:

  • First advance: Due on the last day of the sixth month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Second advance: Due on the last day of the seventh month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Third advance: Due on the last day of the eighth month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Fourth advance: Due on the last day of the ninth month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Fifth advance: Due on the last day of the tenth month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Sixth advance: Due on the last day of the eleventh month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Seventh advance: Due on the last day of the twelfth month of the fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Eighth advance: Due on the last day of the first month of the following fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).
  • Ninth advance: Due on the last day of the second month of the following fiscal year (111/9% of the preceding income year’s tax payable or estimated tax liability).

The TAA provides for various ways to ensure the collection of taxes, including, but not limited to, the following:

  • Departure prohibition order: A departure prohibition order may be used by the tax office to prevent taxpayers from leaving the country without settling outstanding taxes.
  • Garnishee orders: The tax office may garnish bank accounts for outstanding taxes.
  • Registration of charges on personal and real properties of the taxpayer.
  • Distress and sale of personal property.
  • Temporary closure of business.

Penalties

Some of the administrative penalties under the TAA are as follows:

  • Failure to register: Every person who fails to apply for registration as required pursuant to the Act commits an offence against the Act and will, on conviction, be liable to a fine not exceeding 50% of the tax payable where the delay does not exceed six months, or a fine not exceeding the tax payable where the delay exceeds six months.
  • Late filing of a return or any document required by a tax law: A registered person who fails to lodge a tax return (or any document required by a tax law) is liable for a penalty of 20% of the tax payable in the case where tax is payable and a penalty of 5% of the tax payable for every month of default. In any other case, a penalty of FJD 1 per day applies. Effective from 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).
  • Late payment of tax payable: Where any tax remains unpaid on the expiry of the due date, a penalty of 25% of the unpaid tax in respect of that taxable period will apply.
  • Failure to comply with the late payment penalty: Every person who fails to comply with the late payment penalty is liable for penalty of 5% of the unpaid tax for each month of default.
  • Failure to maintain proper records: A registered person who fails to keep, retain, or maintain account, documents, or records is liable for a penalty of 75% (knowingly or recklessly made) or 20% (in other cases).
  • Insufficient payment of advance taxes: A taxpayer who makes advance payment of taxes less than the required amount per instalment is liable for a penalty of 40% of the shortfall. This penalty provision has been suspended for 3 years commencing on 1 August 2020.

Taxpayers adopting a position contrary to a public ruling or a private ruling will not be regarded as a reasonably arguable position (unless the ruling is held to be incorrect).

A taxpayer who, without reasonable excuse, makes any declaration in any tax return that is false or misleading in any material particular or omits from any tax return or declaration any matter or thing required to be made in the tax return commits an offence and is liable to a fine not exceeding FJD 250,000.

A tax agent is liable to a fine not exceeding FJD 50,000 and/or to imprisonment for a term not exceeding ten years if the tax agent:

  • prepares, presents, or causes to be prepared or presented as genuine any document that is not in fact a genuine document or is false or misleading in any material particular
  • makes any entry in any document required to be produced under any tax law that is false and misleading in any material particular
  • makes in any oral declaration to a tax officer or in any document produced to a tax officer any statement that is false or misleading in any material particular or produces or delivers to a tax officer any declaration or document containing any such statement, or
  • omits from a statement made to a tax officer any matter or thing without which the statement is false or misleading in a material particular.

Every Fijian citizen or resident, whether liable for tax or not, should apply for a Taxpayer Identification Number (TIN).

Every taxpayer who conducts a business must notify the tax authority in writing of any changes in information within 21 days of change.

A taxpayer who, without reasonable excuse, fails to apply for a TIN or to notify the tax authority of changes commits an offence and would be liable for a fine not exceeding FJD 25,000 and/or imprisonment of up to ten years.

It is an offence (with penalties of up to FJD 25,000 in fines and/or up to ten years imprisonment) for a taxpayer to charge incorrect tax or fail to charge tax as required by law.

The tax authority can issue an infringement notice where it has reason to believe that a person has committed a prescribed offence.

Tax audit process


The FRCS undertakes ongoing compliance activities to ensure corporations are meeting their tax obligations. Compliance activities take various forms, including questionnaires, reviews of specific issues, and audits.

Statute of limitations


Generally, the tax authority may issue amended notices of assessment at any time. Previously, there was a six-year limitation except in certain cases (e.g. fraud).

Topics of focus for tax authorities


The FRCS has recently been focusing on transfer pricing issues, the implementation of PAYE tax as a final tax, FBT, WHT, and excise and fiscal duties.

Individual - Significant developments

Income tax


Effective from 1 August 2020, subject to certain conditions, a tax deduction will be allowed on loans (inclusive of both principal amount and interest accrued) taken from a licensed financial institution for medical treatment.

As part of the COVID-19 response and effective from 1 April 2020:

  • The rule for advance payment of tax for individuals will be relaxed from the current three payments at a rate of 331/3% to nine payments at a rate of 111/9 % due at the end of each month from April 2020 to December 2020, and penalties on estimated tax will also be removed.
  • Any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).
  • If an individual has a net business loss, the individual’s employment income is reduced by the net business loss in computing the chargeable income, provided that the amount reduced does not exceed 20,000 Fijian dollars (FJD).
  • The compulsory Fiji National Provident Fund (FNPF) employer and employee contributions have been reduced to 5% respectively.

The following amendments to the Fiji Income Tax Act (FITA) 2015 and its Regulations are effective from 1 August 2019 unless indicated otherwise:

  • Tax losses incurred on or after 1 January 2019 can be carried forward for eight years.
  • The withholding tax (WHT) summary should be lodged monthly instead of annually.
  • The export income deduction (EID) of 50% has been reinstated from 1 January 2018 and has been extended until 2020.
  • The tax rate for redundancy payments of 15% has been repealed. Redundancy payment shall be included in taxable income subject to the normal individual income tax rates.
  • Assets costing FJD 1,000 or less may be fully depreciated in the year of acquisition, subject to certain conditions.
  • A 200% tax deduction is available on expenses incurred from the importation of filming equipment for film making and audio visual production by a business registered in Fiji.
  • Introduction of the Post Production Facility Investment Package.
  • Income tax exemption on income from a Public Private Partnership investment for a residential housing development for the term of the partnership, subject to conditions.

The following changes are effective from 1 January 2020:

  • 100% of the employer’s statutory FNPF contribution paid by the employer has been reinstated as a tax deduction.
  • The cash donations exceeding FJD 15,000 (previously FJD 50,000) to a Sports Fund for purposes of sports development in Fiji shall qualify for a deduction of 150%.

Effective 1 April 2020, a 150% tax deduction is available for employer additional contributions paid up to 10% of the total salary paid to the employee.

Tax Administration Act (TAA)


Effective 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).

The following amendments to the TAA are effective 1 August 2019:

  • A claim for tax refund is not admissible if the taxpayer has failed to lodge a tax return or any document required by law and does not make a claim within three years after yea- end unless the refund is attributable to an error by the tax authority.
  • The late lodgement penalty would also apply if any documents required by the tax laws (other than a tax return) are not lodged.
  • Tax returns and required documents may be lodged by electronic means.
  • Notices may be served by electronic means.
  • Lodgement may be made electronically by the due date even if the due date falls on a non-working day.

Value-added tax (VAT)


The supply of residential accommodation is exempt from VAT effective 1 August 2020.

The importation of the following shall not be subject to VAT effective 1 August 2019:

  • Hybrid and electric charging vessels.
  • Ships for coasting-trade.

Environment and climate adaptation levy (ECAL)


The following amendments to the ECAL Act are effective from 1 August 2020:

  • ECAL is reduced from 10% to 5% on prescribed services, income, imported white goods and imported vehicles;
  • The annual gross turnover threshold for ECAL exemption has been increased from FJ$1.25 million to FJ$3 million; and
  • ECAL refund is allowed for persons who import goods for the purposes of re-export based on specific conditions.

The following amendments to the ECAL Act are effective from 7 July 2019 unless indicated otherwise:

  • ECAL on plastic bags will increase from FJD 0.20 to FJD 0.50 effective from 1 January 2020.
  • ECAL shall be applicable on the importation of the following goods:
    • Hybrid vehicles.
    • Smart phones.
    • Air conditioners.
    • Refrigerator and freezers.
    • Televisions.
    • Clothes washers and dryers.
    • Dish washers.
    • Electric stoves.
    • Microwave ovens.
    • Electric lawn mowers.
    • Hair dryers.
    • Toasters.
    • Electric kettles.

Stamp duties


Effective from 1 August 2020, the Stamp Duty Act will be repealed however any document which is executed or takes effect before 1 August 2020 remains subject to stamp duty.

Effective from 1 April 2020 and for the period commencing on and from 1 April 2020 to 31 December 2020, stamp duty exemption applies on:

  • any mortgage, except the transfer or assignment of a mortgage and, for the avoidance of doubt, where stamp duty payable on any other instrument is as per the like duty for a mortgage, the exemption in this sub paragraph does not apply to such instrument, and
  • any air waybill for any goods, merchandise, or effects to be exported from Fiji.

Offshore loans shall be exempt from stamp duty, provided the funds are deposited into a bank account in Fiji.

Individual - Taxes on personal income

Resident individuals are liable to tax on taxable income accruing in or derived from Fiji or elsewhere.

Non-residents are liable to tax only on taxable income accruing in or derived from Fiji. Pensions received by non-resident pensioners from a Fiji source will not be taxed.

When a non-Fiji citizen is in Fiji mainly for employment purposes under a contract of employment of not more than three years, income other than employment income is not subject to tax in Fiji if it is not derived from or does not accrue in Fiji.


Personal income tax rates


Income tax is assessed on taxable (chargeable) income. Where the taxable income of a resident exceeds FJD 50,000, income tax is FJD 3,600 plus 20% in excess of FJD 50,000. In the case of non-residents, income tax is 20% of the taxable income.

In addition to income tax, social responsibility tax (SRT) and environment and climate adaptation levy (ECAL) are imposed on chargeable income.

Resident individuals

Chargeable income (FJD) Income tax payable SRT payable ECAL payable
From To
0 30,000 0 0 0
30,000 50,000 18% assessed on amounts over FJD 30,000 0 0
50,000 270,000 FJD 3,600 plus 20% assessed on amounts over FJD 50,000 0 0
270,000 300,000 FJD 47,600 plus 20% assessed on amounts over FJD 270,000 13% assessed on amounts over FJD 270,000 10% (5% effective from 1 August 2020) assessed on amounts over FJD 270,000
300,000 350,000 FJD 53,600 plus 20% assessed on amounts over FJD 300,000 FJD 3,900 plus 14% assessed on amounts over FJD 300,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 1,500 plus 5% assessed on amounts over FJD 300,000

350,000 400,000 FJD 63,600 plus 20% assessed on amounts over FJD 350,000 FJD 10,900 plus 15% assessed on amounts over FJD 350,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 4,000 plus 5% assessed on amounts over FJD 350,000

400,000 450,000 FJD 73,600 plus 20% assessed on amounts over FJD 400,000 FJD 18,400 plus 16% assessed on amounts over FJD 400,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 6,500 plus 5% assessed on amounts over FJD 400,000

450,000 500,000 FJD 83,600 plus 20% assessed on amounts over FJD 450,000 FJD 26,400 plus 17% assessed on amounts over FJD 450,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 9,000 plus 5% assessed on amounts over FJD 450,000

500,000 1,000,000 FJD 93,600 plus 20% assessed on amounts over FJD 500,000 FJD 34,900 plus 18% assessed on amounts over FJD 500,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 11,500 plus 5% assessed on amounts over FJD 500,000

1,000,000 and above FJD 193,600 plus 20% assessed on amounts over FJD 1,000,000 FJD 124,900 plus 19% assessed on amounts over FJD 1,000,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 36,500 plus 5% assessed on amounts over FJD 1,000,000

Non-resident individuals

Chargeable income (FJD) Income tax payable SRT payable ECAL payable
From To
0 270,000 20% of chargeable income 0 0
270,000 300,000 20% of chargeable income 13% assessed on amounts over FJD 270,000 10% (5% effective from 1 August 2020) assessed on amounts over FJD 270,000
300,000 350,000 20% of chargeable income FJD 3,900 plus 14% assessed on amounts over FJD 300,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 1,500 plus 5% assessed on amounts over FJD 300,000

350,000 400,000 20% of chargeable income FJD 10,900 plus 15% assessed on amounts over FJD 350,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 4,000 plus 5% assessed on amounts over FJD 350,000

400,000 450,000 20% of chargeable income FJD 18,400 plus 16% assessed on amounts over FJD 400,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 6,500 plus 5% assessed on amounts over FJD 400,000

450,000 500,000 20% of chargeable income FJD 26,400 plus 17% assessed on amounts over FJD 450,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 9,000 plus 5% assessed on amounts over FJD 450,000

500,000 1,000,000 20% of chargeable income FJD 34,900 plus 18% assessed on amounts over FJD 500,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 11,500 plus 5% assessed on amounts over FJD 500,000

1,000,000 and above 20% of chargeable income FJD 124,900 plus 19% assessed on amounts over FJD 1,000,000 10% assessed on amounts over FJD 270,000

Effective 1 August 2020, FJD 36,500 plus 5% assessed on amounts over FJD 1,000,000

Dividend withholding tax


Dividends are no longer subject to tax in the hands of shareholders.

Resident interest withholding tax


A WHT of 10% is deductible on payments or accrual of interest by banks and other financial institutions to resident depositors. Exempt income is not subject to resident interest WHT.

Interest derived by a taxpayer with an annual income of not more than FJD 30,000 shall not be subject to resident interest WHT.

Local income taxes


There are no local taxes on income in Fiji.

Individual - Residence

Residents are normally those who reside in Fiji and are present in Fiji for a period(s) aggregating 183 or more days during any 12-month period. Persons domiciled in Fiji are also considered resident, unless their permanent place of abode is outside Fiji.

Individual - Other taxes

Contributions to the Fiji National Provident Fund (FNPF)


All employers and employees must contribute an amount equal to at least 10% and 8%, respectively, of the gross cash earnings of all employees to the FNPF. Effective 1 April 2020, the FNPF employer and employee contributions have been reduced to 5% respectively as part of the government’s COVID-19 response.

Foreign employees are not required to contribute to the FNPF. However, employers have the option to include foreign employees by informing the FNPF in writing of both their and the employees intention to register with the FNPF.

Payroll taxes


Employers are required to deduct and remit monthly to the tax authority appropriate pay-as-you-earn (PAYE) tax and SRT (including ECAL) from employee gross cash emoluments.

If appropriate PAYE tax and SRT are not deducted and remitted, the tax authority may recover the taxes from the employer or the employee and / or disallow a tax deduction for the expenditure.

Capital gains tax (CGT)


Certain capital gains may be subject to CGT of 10%.

Any gains from the following sales/disposals shall be exempt from CGT:

  • Gains by a resident individual or Fiji citizen that do not exceed FJD 16,000. Effective from 1 August 2020 this has been increased to FJD30,000.
  • First residential property or principal place of residence by a resident individual or Fiji citizen.
  • Shares listed on the South Pacific Stock Exchange (SPSE).
  • Shares in any unit trust in Fiji, subject to certain conditions.
  • An asset that is used solely to derive income exempt from tax under the FITA. However, disposal of shares (apart from those listed separately) are not exempt for CGT purposes.
  • Capital assets (including shares) by a Fiji resident as part of the process for listing on the SPSE, subject to certain conditions.

Consumption taxes


Value-added tax (VAT)

VAT of 9% is generally levied on the supply of goods and services in Fiji. See the Other taxes section in the Corporate tax summary for more information.

Service turnover tax (STT) and environment and climate adaptation levy (ECAL)


Effective from 1 August 2020, the Service Turnover Tax Act will be repealed however any transaction entered into and paid before 1 August 2020 remains subject to STT at the rate of 6%.

STT at the rate of 6% is imposed on the turnover of a person conducting a business involving the provision of a prescribed service where the annual gross turnover for the prescribed service exceeds FJD 1.25 million, which includes the following:

  • Provision of accommodation, refreshments, and any other services by a hotel.
  • Any services provided in a vessel that is principally or wholly engaged in the carriage of tourists in Fiji.
  • Provision of meals, beverages, and any other services in a bar.
  • Provision of services in a nightclub.
  • Provision of in-bound tour services.
  • Live entertainment provided by artists for a fee.
  • Provision of services for recreational activity for gain.
  • Provision of services relating to exhibition of films to the public or section thereof by an exhibitor where a charge is made for admission, including services provided by cinema operators.
  • Provision of services by hired or rental car operators and chartered transport services to tourists by omnibus or mini-bus operators.
  • Provision of meals, beverages, and any other services by bistros or coffee shops.
  • Provision of meals, beverages, and any other services on sale by restaurants.
  • Provision of charter flight services by an aircraft or helicopter, excluding such services for medical or natural disaster relief evacuation.
  • Provision of all water sports, including underwater activities and river safaris.
  • Provision of accommodation in a private residence or property that accommodates tourists, international students, or overseas visitors who are paying guests.

The above-prescribed services are also subject to ECAL at the rate of 10%. However, non-consumption services by hotel properties are no longer subject to STT (or ECAL).

STT and ECAL shall only be imposed once on the same service.

Effective from 1 August 2020, the following amendments become applicable:

  • STT has been repealed;
  • ECAL has been reduced from 10% to 5% on prescribed services, income, superyacht charter fees, imported white goods and imported vehicles; and
  • The threshold for application of ECAL has been increased from FJ$1.25 million to FJ$ 3million.

The following shall also be subject to ECAL:

  • Taxable income in excess of FJD 270,000 derived by individuals.
  • Prescribed plastic bags at 20 cents per bag (50 cents effective from 1 January 2020).
  • Import of new or used luxury vehicles with engine capacity exceeding 3000cc, hybrid vehicles, and certain electrical goods, subject to certain exemptions. This has been repealed effective from 1 August 2020.
  • Charter of superyachts.

Estate or inheritance tax


There are no estate or inheritance taxes in Fiji.

Gift tax


There are no gift taxes in Fiji.

Property taxes

There are no property taxes at the national level. However, the municipalities may charge property rates in their respective areas.

Fringe benefits tax (FBT)


FBT of 20% is payable by the employer on the grossed-up value of certain fringe benefits provided to employees (the effective tax rate is 25%).

Stamp duties


Effective from 1 August 2020, the Stamp Duty Act will be repealed however any document which is executed or takes effect before 1 August 2020 remains subject to stamp duty.

Under the Fiji Stamp Duties Act, stamp duty is payable in respect of instruments, including, but not limited to, declaration of trusts, leases, loans, mortgages, transfer of property (or interest therein), and shares.

Individual - Income determination

Income tax in Fiji is levied on an individual’s taxable income, calculated as assessable income less any deductions allowed. An individual’s employment income, income from property, business income, and income earned from investments (e.g. rent and royalties, interest, dividends) are included in an individual’s calculation of assessable income. Assessable income includes undefined or unidentified deposits in any bank account.

Employment income


A foreign person residing in Fiji solely or mainly for the purpose of engaging in employment is subject to tax on salary earned in Fiji regardless of where payment is made. Gross income includes wages, salaries, fees and other emoluments, living allowances, housing allowances, tax reimbursements, and other benefits received from any office or employment.

Employment income’ has been clarified to include:

  • Work condition supplements (defined as additional amounts paid as compensation for difficult, unpleasant, or dangerous work conditions).
  • Any expenditure incurred by an employee that is reimbursed by the employer (not including expenditure incurred on behalf of the employer in the performance of the employee’s duties).

Fringe benefits provided to an employee that are subject to FBT are not included in the employee’s taxable income.

Cash allowances and similar allowances or benefits are included as part of taxable income in calculating total tax payable. However, no deductions are allowed against employment income. As indicated above, employment income is subject to a final tax in certain cases.

As part of the COVID-19 response and effective from 1 April 2020, if a person has a net business loss, the person’s employment income is reduced by the net business loss in computing the chargeable income, provided that the amount reduced does not exceed FJD 20,000.

Effective from 1 August 2020, a tax deduction will be allowed on loans (inclusive of both principal amount and interest accrued) taken from a licensed financial institution for medical treatment.

Capital gains


Any profit or gain accrued or derived from the sale or disposal of real or personal property, or any interest therein, shall be subject to tax when:

  • the business of the company comprises of dealing in such property
  • the property is acquired for the purpose of selling or otherwise disposing thereof, or
  • any profit or gain is derived from the carrying on or carrying out of any undertaking or scheme entered into or devised for the purpose of making a profit.

In such a case, the capital gain may be subject to CGT of 10%.

Investment income


A full exemption from tax is available on gains derived from the following transactions:

  • Sale of capital assets (including shares) for the purpose of listing in the SPSE, subject to certain conditions.
  • Trading of shares in an SPSE listed company.

For a foreign person who is resident in Fiji for tax purposes, generally, income from all sources, including interest, dividends, rent, and royalties, is subject to income tax at graduated rates. In spite of the above, income from interest, dividends, or royalties derived outside Fiji by a person resident in Fiji solely or mainly for the purpose of engaging in any employment under a contract of employment of not more than three years duration is not subject to Fiji income tax.

Dividend income

Dividends are no longer subject to tax in the hands of the shareholder.

Interest income

Interest income derived by a resident shall be appropriately subject to resident interest WHT of 10% (previously 20% on interest from a financial institution), which is a final tax if paid by a financial institution. Exempt income shall not be subject to WHT.

A full exemption from tax is available on interest income:

  • received by citizens of other countries recognised by Fiji in the ‘Fiji My Second Home’ programme, subject to certain conditions, and
  • received by non-residents who hold funds in Fiji commercial bank accounts under the Foreign Currency Account Scheme, subject to certain conditions.

Partnership income


The income of the partners from a partnership for any income year is equal to each partners’ respective share of income from that partnership. Each partner declares income separately and is individually liable for filing a tax return for each applicable year.

Individual - Deductions

Employment expenses


No deductions shall be allowed in reducing employment income.

However, as part of the COVID-19 response and effective from 1 April 2020, if a person has a net business loss, the person’s employment income is reduced by the net business loss in computing the chargeable income, provided that the amount reduced does not exceed FJD 20,000.

Personal deductions


Deductions for non-business expenses are minimal and are unlikely to be available to a foreign employee.

Effective from 1 August 2020, subject to certain conditions, a tax deduction will be allowed on loans (inclusive of both principal amount and interest accrued) taken from a licensed financial institution for medical treatment.

Charitable contributions

The deduction threshold for contributions to approved academic and charitable organisations is FJD 100,000.

There are certain other specific donations that qualify for varying levels of deductions, including:

  • Donations to the Fiji Heritage Foundation, which qualify for a deduction of 150%.
  • Cash donations exceeding FJD 50,000 to the Poverty Relief Fund for Education, which qualify for a deduction of 200%.
  • Cash donations exceeding FJD 50,000 (FJD 15,000 effective 1 January 2020) to a Sports Fund (as approved by the CEO of the Fiji Revenue and Customs Service [FRCS]) for purposes of sports development in Fiji, which qualify for a deduction of 150%.
  • Total cost of new computers, laptops, and tablets of not less than FJD 10,000 but not exceeding FJD 100,000 donated to urban and rural schools registered with the Ministry of Education, which qualify for a deduction of 150% and 200%, respectively.
  • Cash donations of not less than FJD 10,000 but not exceeding FJD 100,000 to the Disaster Rehabilitation Fund, which qualify for a deduction of 150%.
  • Cash donations not exceeding FJD 50,000 towards any approved housing project for squatters by the Fiji government, which qualify for a deduction of 150%.
  • Cash donations of not less than FJD 10,000 to the Farmers Disaster Relief Emergency Fund Account, which qualify for a deduction of 200%.
  • Effective 1 April 2020, a person is also allowed a deduction for 300% of the amount of a cash donation made in a tax year to a fund established by the government to respond to the COVID-19 pandemic.
  • Effective 1 August 2020, a 100% tax deduction will be available for cash donation made to a sporting entity recognised by the Fiji National Sports Commission (previously only available for cash donations up to $15,000 made to an “approved sports funds”).
  • Effective 20 August 2020, a 150% tax deduction will be available for any cash donation made to a fund established by the Fiji government for the 50th independence day celebrations.

No deductions for charitable contributions shall be allowed against employment income.

Personal allowances


Personal allowances are no longer available.

Business deductions


In calculating taxable income, deductions may be allowed for revenue expenditure wholly and exclusively incurred for the purposes of deriving that income. Deductions are generally not available for capital expenditure, personal or living expenses, or for income taxes paid.

As part of the COVID-19 response and effective from 1 April 2020, if a person has a net business loss, the person’s employment income is reduced by the net business loss in computing the chargeable income, provided that the amount reduced does not exceed FJD 20,000.

Furthermore, a landlord that reduces the commercial rent payable under a tenancy agreement is allowed a deduction for the aggregate sum of the difference between the rent payable on 26 March 2020 and the rent payable in the period commencing on and from 27 March 2020 to 31 December 2020, subject to certain conditions.

Individual - Foreign tax relief and tax treaties

Foreign tax relief


A credit is allowed in Fiji for foreign tax paid on foreign income. The tax credit is limited to the lesser of the Fiji tax payable or the foreign tax paid on such income.

Tax treaties


See the Withholding taxes section in the Corporate summary for a list of countries with which Fiji has a tax treaty.

Individual - Other tax credits and incentives

Employment incentives


Salary and wages paid to first-time employees for the first 12 months of employment qualifies for a 200% deduction, subject to certain conditions. The definition of qualified employees includes apprentices and trainees. This deduction is available until 31 December 2020. Effective from 1 April 2020, the deduction has been increased to 300% and is available until 31 December 2023.

Salary and wages paid to students qualify for a 200% deduction, subject to certain conditions. This deduction is available until 31 December 2020. Effective from 1 April 2020, the deduction has been increased to 300% and is available until 31 December 2023.

Salary and wages paid to disabled persons qualify for a 300% deduction, subject to certain conditions. This deduction is available until 31 December 2022. Effective from 1 April 2020, the deduction has been increased to 400% and is available until 31 December 2023.

Employees’ education fees qualify for a 150% deduction, subject to certain conditions.

Effective 1 January 2019, the cost incurred by an employer providing employee training qualifies for a 150% deduction if training providers approved by the FRCS conduct the training.

Effective 1 January 2019, salaries and wages paid to employees taking family care leave qualify for a 150% deduction, subject to certain conditions.

Effective 1 January 2019, salaries and wages paid to employees taking paternity leave qualify for a 150% deduction.

Effective 1 April 2020, a person is also allowed a deduction for 300% of the amount of salary or wages paid between 1 April 2020 to 31 December 2020 to an employee affected by COVID-19 and who is required by the Ministry of Health and Medical Services to be quarantined.

Hotel industry incentives


Approved capital expenditure incurred in building, renovating, or expanding a new or existing hotel is subject to an investment allowance of 25% of the approved expenditure, in addition to normal depreciation. Previously, this was only applicable to new hotels.

The recipients of provisional approval for hotel investment tax incentives are required to complete the hotel projects within two years from the date provisional approval is granted.

Effective 1 August 2020, a 150% tax deduction will be available for hotels and resorts for amounts paid for any salaries or wages paid for employment of local artists.

Filmmaking and audio-visual incentives


A tax exemption or reduced tax rate is available on the income of non-resident employees of an approved non-resident company engaged or intending to be engaged in making a film in Fiji.

Tax concessions are also available for residents of areas declared as studio city zones by the appropriate government minister.

Effective 1 August 2019, a 200% tax deduction is available on expenses incurred from the importation of filming equipment for film making and audio-visual production by a business registered in Fiji.

Effective 1 August 2019, the following concession is available to a person that sets up a post-production facility with capital investment of at least FJD 2 million:

  • Exemption from CIT for a period of seven years.
  • Duty-free entry of certain capital equipment, plant, and machinery, upon receiving provisional approval from the minister.

Other tax incentives


Effective 1 April 2020, the following incentives are available as part of government’s response to the COVID-19 pandemic:

  • A landlord that reduces the commercial rent payable under a tenancy agreement is allowed a deduction for the aggregate sum of the difference between the rent payable on 26 March 2020 and the rent payable in the period commencing on and from 27 March 2020 to 31 December 2020, subject to certain conditions.
  • A person is allowed a deduction for 300% of the amount of a cash donation made in a tax year to a fund established by the government to respond to the COVID-19 pandemic.

Taxpayers in the agriculture, fisheries, and tourism industries, with a maximum turnover threshold of FJD 500,000, may be exempt from income tax.

40% of capital expenditure of not less than FJD 50,000 incurred by any existing business located in Vanua Levu is allowed as a deduction for tax purposes, subject to certain conditions.

A 150% deduction is available on expenditure not exceeding FJD 250,000 incurred in marketing goods and services for export to any of the South Pacific countries, excluding Australia and New Zealand.

Income derived by a Fiji citizen from backpacker operations with an annual gross turnover not exceeding FJD 1 million is exempt from income tax.

Income equal to 25% of the total capital expenditure incurred exceeding FJD 250,000 (effective 1 August 2019; previously FJD 1 million) for the modernisation of buildings is exempt from income tax, subject to certain conditions.

Effective 1 August 2019, income derived from a Public Private Partnership investment for a residential housing development is exempt from tax for the term of the partnership, subject to certain conditions.

Effective 1 August 2020, any interest income earned from corporate bonds listed on the South Pacific Stock Exchange are exempt for income tax purposes.

Effective 1 August 2020, new incentive package has been introduced for the subdivision of land for residential or commercial purposes.

Individual - Tax administration

The Tax Administration Act (TAA) was promulgated with the stated intention of harmonising the administration of the various tax laws, including income tax and VAT. CGT, FBT, STT, and ECAL are also covered by the provisions of the TAA.

If a due date falls on a Saturday, Sunday, or holiday, the due date is the last working day before the due date except when the documents are lodged electronically.

Effective 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).

Taxable period


The taxable year for the individual is the calendar year.

Tax returns


Personal income tax returns for the immediately preceding year must be lodged by 31 March each year. However, under the Tax Agent Lodgement Programme, an extension of time may be granted to lodge the income tax returns.

Effective 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).

Employees are no longer required to lodge income tax returns in certain cases (e.g. employee has only one employer during the year and appropriate PAYE taxes have been deducted).

Payment of tax


There is income tax withholding from salaries (i.e. PAYE final withholding tax). PAYE final withholding tax shall be a final tax for certain employees.

Generally, if taxpayers have sizable income not subject to PAYE final withholding tax, they will be required to make provisional payments of estimated tax in three instalments.

Advance tax payments for the 2020 tax year are due in nine equal instalments, which are due at the end of each month from April to December 2020.

The TAA provides the tax authorities with various means to collect taxes including, but not limited to:

  • Departure Prohibition Order: A departure prohibition order may be used by the tax office to prevent taxpayers from leaving the country without settling outstanding taxes.
  • Garnishee orders: The tax office may garnishee bank accounts for outstanding taxes.
  • Registration of charges on personal and real properties of the taxpayer.
  • Distress and sale of personal property.
  • Temporary closure of business.

Penalties

Some of the administrative penalties under the TAA are as follows:

  • Failure to register: Every person who fails to apply for registration as required pursuant to the Act commits an offence against the Act and will, on conviction, be liable to a fine not exceeding 50% of the tax payable where the delay does not exceed six months; or a fine not exceeding the tax payable where the delay exceeds six months.
  • Late filing of a return or any document required by a tax law: A registered person who fails to lodge a tax return (or any document required by a tax law) is liable for a penalty of 20% of the tax payable in the case where tax is payable and a penalty of 5% of the tax payable for every month of default. In any other case, a penalty of FJD 1 per day applies. Effective 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period (i.e. the period commencing on and from 31 March 2020 to 31 December 2020).
  • Late payment of tax payable: Where any tax remains unpaid on the expiry of the due date, a penalty of 25% of the unpaid tax in respect of that taxable period will apply.
  • Failure to comply with the late payment penalty: Every person who fails to comply with the late payment penalty is liable for penalty of 5% of the unpaid tax for each month of default.
  • Failure to maintain proper records: A registered person who fails to keep, retain, or maintain account, documents, or records is liable for a penalty of 75% (knowingly or recklessly made) or 20% (in other cases).
  • Insufficient payment of advance taxes: An individual taxpayer may be required to make advance payment of taxes. Where such an individual taxpayer makes advance tax payments less than the required amount per instalment, the taxpayer is liable to a penalty of 40% of the shortfall. This penalty provision has been suspended for 3 years commencing on 1 August 2020.

Taxpayers adopting a position contrary to a public ruling or a private ruling will not be regarded as having a reasonably arguable position (unless the ruling is held to be incorrect).

A taxpayer who, without reasonable excuse, makes any declaration in any tax return that is false or misleading in any material particular or omits from any tax return or declaration any matter or thing required to be made in the tax return commits an offence and is liable to a fine not exceeding FJD 250,000.

A tax agent is liable to a fine not exceeding FJD 50,000 and/or to imprisonment for a term not exceeding ten years if the tax agent:

  • prepares, presents, or causes to be prepared or presented as genuine any document that is not in fact a genuine document or that is false or misleading in any material particular
  • makes any entry in any document required to be produced under any tax law that is false and misleading in any material particular
  • makes in any oral declaration to a tax officer or in any document produced to a tax officer any statement that is false or misleading in any material particular or produces or delivers to a tax officer any declaration or document containing any such statement, or
  • omits from a statement made to a tax officer any matter or thing without which the statement is false or misleading in a material particular.

Every Fijian citizen or resident, whether liable for tax or not, should apply for a Taxpayer Identification Number (TIN).

Every taxpayer who conducts a business must notify the tax authority in writing of any changes in information within 21 days of change.

A taxpayer who, without reasonable excuse, fails to apply for a TIN or to notify the tax authority of changes commits an offence and would be liable for a fine not exceeding FJD 25,000 and/or imprisonment of up to ten years.

It is an offence (with penalties of up to FJD 25,000 in fines and/or up to ten years imprisonment) for a taxpayer to charge incorrect tax or fail to charge tax as required by law.

The tax authority can issue an infringement notice where it has reason to believe that a person has committed a prescribed offence.

Tax audit process


The FRCS undertakes on-going compliance activities to ensure taxpayers are meeting their tax obligations. Compliance activities take various forms, including questionnaires, reviews of specific issues, and audits.

Statute of limitations


Generally, the tax authority may issue amended notices of assessment at any time. Previously, there was a six-year limitation except in certain cases (e.g. fraud).