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3.1. Corporate Tax Residence

A company is considered as resident in Barbados if the central management and control is exercised in Barbados.

COVID-19 Emergency Measures

In response to the COVID-19 pandemic, Barbados published a guidance note in relation to corporate tax residence for the income year 2020. The guidance addresses cases where a company, which is normally considered to be tax resident in Barbados by virtue of maintaining central management and control in Barbados, may be unable to satisfy the legal criteria to be deemed a resident company for the income year 2020 because the non-resident directors of the company are unable or unwilling to travel to Barbados due to COVID-19 restrictions. For such cases, the following guidance is provided:

  • The residency of the company will not change for the fact that a few board meetings are held, or some decisions are taken, outside of Barbados for a short period of time;
  • The non-resident directors and companies are required to maintain records of facts and circumstances of the COVID-19 related presence in Barbados, and outside of Barbados, which may be required to be submitted upon request by the tax authorities; and
  • The tax authorities may consider a holistic view based on facts and circumstances of each case for determining tax residency.

Further, even if a potential change of circumstances triggers an issue of dual residency, the matter can be resolved through the applicable double taxation agreements.