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5.6. Qualification of Specific Income Categories for Tax Purposes

Interest

Any amount received on account of, or in lieu of, or in the satisfaction of interest is taxable in Barbados.

The following interest income is exempt from tax:

  • Interest on bonds;
  • Interest on debentures;
  • Interest on shares of the Government of Barbados which is beneficially owned by a non-resident person, up to a specified limit;
  • Interest on tax reserve;
  • Interest (up to a specified limit) on holdings of:
    • National Development Bonds;
    • National Housing Bonds;
    • Savings Bonds; and
    • Sugar Industry Bonds classified as non-taxable bonds; and
  • Interest income from some Caribbean Community (CARICOM) countries.

Royalties

The term ‘royalties’ is defined as payment of any kind received as consideration for the use of or the right to use, any copyright of literary, artistic, or scientific work, including royalties in respect of motion pictures and works on film, tape, or other means of reproduction for use in connection with radio or television, any patent, trademark, design or model, plan, secret formula or process, or scientific experience.

Services Fees

The term ‘service fees’ includes an amount on account or in satisfaction of liability for fees or charges arising under a contract for the provision of management or administrative services or of technical or managerial skills, whether such contract is oral or in writing and whether or not made in Barbados.