Taxation of legal entities
Non-resident legal entities pay tax on profits received within the state. Resident legal entities pay tax on the income received all over the world. Resident legal entities are companies that are officially registered in St. Kitts and managed by local directors. Corporate tax rate is 35%. The rate is high, but it involves certain benefits. For example, if St. Nevis companies conduct business with non-residents of St. Nevis, they may be exempt from tax.
A separate item is a tax on profit of non-corporate entrepreneurs. Tax is imposed on a profit of over XCD 12,500 from the supply of goods and over XCD 2,000 from rendering services. The tax rate is 4%.
If dividends, interest or royalties are paid to a resident, the tax is not withheld. If dividends, interest and royalties are received by a non-resident, the tax is 10%. If profits are transferred from a branch office in Saint Kitts and Nevis to a head office overseas, it is subject to a 10% tax.