In Fiji, employers have a responsibility to contribute to the Fiji National Provident Fund (FNPF). This contribution is calculated as 8% of the employee's gross salary.

Accident Compensation Commission, Fiji (ACCF) Levy

In addition to the FNPF, employers may also be subject to a levy to fund workers' compensation schemes. The contribution rates for this levy vary by industry and risk levels.

Reporting and Payment

Employers are required to withhold employee contributions, add their own, and remit the total payments to the relevant authorities, which may include the FNPF and potentially the ACCF.

In Fiji, a progressive income tax system is used. The income tax rates for residents can change, so it's important to stay updated with the latest information.

Employee's Social Security Contributions

Employees in Fiji contribute to the Fiji National Provident Fund (FNPF). The employee's contribution is 8% of the gross salary.

Important Considerations

One important consideration is the concept of withholding. This is a process where employers deduct income tax and social security contributions (FNPF) from their employees' salaries. However, this is a responsibility of the employer and not the employee.

The standard VAT rate in Fiji is 9%, with certain essential services potentially being zero-rated (0% VAT).

VAT Liability for Services

Your VAT liability is determined by several factors:

• Place of Supply: The place of supply rules determine where a service is considered to be supplied for VAT purposes. General rules apply depending on the type of service, whether the customer is a business (B2B) or an individual (B2C), and the location of both parties.
• Reverse Charge Mechanism: In certain B2B transactions, the reverse charge mechanism might apply. This means that the Fijian business receiving the service from a non-resident supplier might become responsible for accounting for the VAT.

Important Categories of Services

• Electronically Supplied Services: If you provide digital services (software, streaming content, website subscriptions) to consumers in Fiji, you may be liable for VAT, even if your business is located outside Fiji.
• Services Related to Immovable Property: Services with a significant connection to a property located in Fiji (e.g., construction, real estate services) usually fall under Fijian VAT rules.
• Professional Services: Consulting, legal, and accounting services, when performed in Fiji or deemed supplied in Fiji, typically are subject to VAT.

VAT Registration and Reporting

• Registration Threshold: Businesses exceeding a specific revenue threshold within Fiji might be required to register for VAT.
• Filing and Payment: Registered businesses must file periodic VAT returns and make corresponding payments to the tax authorities in Fiji.

Tax incentives can be a significant boost for businesses, potentially reducing the corporate tax rate to as low as 10% for companies engaged in qualifying activities. This reduction can be enjoyed for a specified period, providing a substantial financial advantage.

Import duty exemptions or concessions might also be available for businesses importing materials and equipment required for approved projects. These duty concessions can significantly lower the cost of setting up and running a business.

Incentives for Specific Sectors

Different sectors may offer specific tax incentives. For instance, the manufacturing and export sector might provide tax holidays, duty-free imports, and other incentives to encourage investment.

The agriculture sector might also offer specific tax incentives, particularly to promote value-addition and processing. This can be a significant boost for businesses involved in agricultural activities.

The tourism sector is another area where businesses might be eligible for tax breaks. Businesses investing in hotel development and other tourism-related projects might find these incentives particularly beneficial.

The film industry in Fiji offers incentives to attract film production, including tax rebates and concessions. This can be a significant draw for businesses involved in film production.

Regional Incentives

Businesses establishing themselves in designated less-developed regions or outer islands may qualify for additional tax benefits. These regional incentives can provide a significant boost for businesses willing to set up in these areas.

Important Considerations

When considering tax incentives, it's important to note that specific eligibility requirements and conditions apply to different incentives. Businesses should ensure their activities fall within the qualifying criteria.

Additionally, tax incentives usually involve formal applications and approval processes through relevant government agencies. It's crucial for businesses to understand these processes and ensure they meet all the necessary requirements.