The West Indies Island state of the Bahamas imposed VAT obligations on non-resident providers and digital marketplaces for digital and electronic services to consumers from 1 December 2019. There is no special VAT registration process, and no requirement to appoint a local VAT Fiscal Representative. There is a VAT registration threshold of BSD 100,000.
What digital services are subject to Bahamas VAT?
Income from the following services is liable to VAT:
- Gaming and games of chance
- SaaS or cloud-based software
- Streaming or download software
- Online storage
VAT registration and compliance
There is no electronic services VAT registration process for non-residents in the Bahamas – the same requirements are for resident businesses are required. Providers must register with the Tax Administration Management Information System once they approach the annual VAT registration threshold of BSD 100,000.
Providers or marketplaces must produce locally compliant VAT invoices.
VAT returns must be filed on quarterly basis for most digital services providers. The submission must be made by the 21stof the month following along with any VAT liability payment. The return can be filed electronically via OTAS portal.
Electronic marketplace VAT obligations
Where a provider of digital services acts through an agent, including telecoms and electronic commerce, the intermediary takes on the VAT obligations. Any platform would therefore have to review the obligation to VAT register and report the VAT instead of their third-party merchant.
B2B digital invoices exempted
Foreign providers do not need to charge VAT to resident businesses in the Bahamas. Instead, they may rely on the VAT reverse charge, and zero-rate the transaction. The customer can report the transaction through their VAT return. If a foreign provider only has resident business customers, there is no requirement to VAT register.
Compiling VAT or GST return can be complex. VAT Calc’s single platform VAT Filer can correctly complete any country filings with verified VAT or GST transactional data from our VAT Calculator or VAT Auditorintegrated tools.
Central and South America VAT on digital services
|Comments (click for details)||Rate||Date||Threshold||Comments|
|Bahamas||10%||Jan 2015||BSD 100,000|
|Barbados||17.5%||Dec 2019||BBD 200,000|
|Costa Rica||13%||Oct 2020||Nil||Withholding VAT option|
|Dominican Republic||18%||2023||Nil||Currently withholding VAT|
|El Salvador||13%||2022||-||Replace Withholding VAT|
|Paraguay||10%||Jan-21||Nil||Withholding VAT; 4.5% DST|
|Puerto Rico||10.5%||Jan 2020||$100,000; or 200 transactions||Marketplaces|
|Suriname||10%||Jan 2023||SRD 500,000|
|Uruguay||22%||Jan 2018||Nil||VAT and Withholding Tax|