Want to setup a company? This will tell you about tax laws in Cuba, you have to know about taxation for a which is the most common company type in Cuba.

Usually a foreigner needs the approval of the authorities to set up a company in Cuba. CU taxes resident companies on their worldwide income. The headline rate for income remitted, from our research, but seek professional advice, is 35%. Cuba does not have known exemptions to remit income earned abroad. Taxes are high in Cuba as the general corporation tax rateis 35%. This ranks Cuba as 134th overall with regards to CIT globally. For companies whose activities are natural resources exploitation CIT may be 50%. There may be exemptions and tax holidays for joint ventures between State companies and foreign capital.

The value added tax (VAT) rate in Cuba ranges from 5% up to 25%, that ranks Cuba as 134th when compared to VAT taxation rate internationally. In terms of other taxation, an employer will contribute 14% to the equivalent of a social security fund and an employee will contribute 0%.

We are not aware of the existence of thin capitalization rules in Cuba. This refers to any sort of laws on companies' debt-to-asset ratios. Dividends are included in the CIT taxable income. Dividends are payments of an earnings of the legal entity, established by the board, to a class of its shareholders. Dividends can be one of the following stock, cash, or property. Capital Gains are CIT taxable income. A capital gains tax is levied on the profits that a corporation or natural person realizes when they sell sells a capital asset for a price that is higher than the purchase price.

Resident companies under the Foreign Investment Act may be not subject to withholding tax on their payments on dividends, interests and royalties abroad. For branches or subsidiaries: the interest witholding rate is estimated at 10%. This means that the relevant tax authorities expects branches to automatically withhold 10% of money remitted abroad on interest payments. The dividends witholding rate is 15%. This should be interpreted usually that the taxman expects 's to automatically withhold 15% of payments abroad on dividend payments. Royalties are subject to a 5% withholding tax.

There is a tax on net wealth in Cuba. There are inheritance taxes in Cuba placed on an estate. There are not many well known R&D intitiatives that provide tax relieft in CU.

The above is not tax or legal advice for your company's personal tax obligations. Incorporations.io can to point you to an accountantin Cuba who can get you the proper advice and help you need. Want to work together? Click the free consultation button above.