Employer Tax Contributions

Tax Type	Rate	Base
Social Security	12%	Employee's gross salary
Payroll Tax (Labor Utilization)	11% or 25%	Total wages, salaries, gratuities, commissions
Tax on Use of Workforce	20% down to 5%	Workforce utilization (varies by year of employment)

Filing & Compliance

• Employers must register with the Oficina Nacional de la Administración Tributaria (ONAT).
• Employers are responsible for withholding employee income tax and social security contributions, remitting them to the National Institute of Social Security (INASS) and tax authorities monthly.
• Maintain accurate payroll records and employee tax documents.

In Cuba, employee tax deductions encompass income tax, primarily impacting private sector workers and those with non-state employment.

Income Tax

• Private Sector Employees: A progressive income tax rate applies to private sector employees, starting at a lower rate and increasing with income. This also pertains to self-employed individuals, those in the artistic and agricultural sectors, designers, social communicators, journalists, personnel receiving bonuses, and partners in MSMEs receiving dividends. As of 2024, a 20% income tax is levied on earnings above 30,000 Cuban pesos (approximately $109 USD) per month. However, for those in the agricultural sector a fixed rate of 2% applies.

• Non-State Employment: Individuals engaged in economic activities outside of government employment are subject to income tax. Two regimes exist: one based on accounted profits (for incomes over 100,000 CUP, equivalent to roughly $4,000 USD, and specific occupations like food retailing), and another using a fixed monthly fee based on occupation (for other retailers). The profit-based regime allows deductions for costs up to a limit defined by the Minister of Finances, along with deductions for other taxes.

• Income from Abroad: Income from remittances sent from abroad is not taxed. However, income derived from contracts taken abroad is taxed at a 4% rate without deductions.

Other Taxes and Deductions

While specific details about additional deductions are limited in the provided sources, other taxes and potential deductions related to Cuban employment may exist, such as social security contributions and other mandatory deductions. It's important to consult official Cuban government resources or a qualified tax advisor for precise details on these deductions and updated information for 2025.

Tax Declaration and Payment

The tax declaration and payment campaign typically begins in January. For the 2024 tax year, the deadline for self-employed workers and others under the progressive income tax system is April 30th, 2025. Other taxes, such as the tax on profits for legal entities, have different deadlines. Early payment incentives might be available. Check with ONAT (Oficina Nacional de Administración Tributaria) for current deadlines and incentives.

It's crucial to remember that tax laws and regulations are subject to change. This information is based on data available as of February 5, 2025, and might not reflect the most recent updates. Consulting directly with Cuban tax authorities or a qualified professional is always advisable for the latest details.