Verified Facts
The tax rates in Brunei range from 0% to 20% for personal income, with a corporate tax rate of 3.5% to 20%, and there is no value-added tax or goods and services tax, but a sales tax is applied on certain goods.
Tax laws change frequently. Always consult a qualified tax professional for advice specific to your situation. This is a general guide only.
Quick Facts
Tax System Overview
Brunei has a territorial taxation system, where tax is only levied on income earned within the country, regardless of the taxpayer's residency status. However, residents are also subject to tax on their worldwide income, with credits available for taxes paid in other countries. To be considered a tax resident in Brunei, an individual must be physically present in the country for at least 183 days in a calendar year. This includes individuals who have a permanent home in Brunei, regardless of whether they are physically present in the country.
The tax system in Brunei is relatively simple, with a focus on oil and gas production and foreign investment. The government has implemented various incentives to attract foreign investors, including a low corporate tax rate and exemptions from certain taxes. Taxpayers in Brunei are required to file their tax returns on a calendar year basis, with the tax year ending on December 31. The tax authority in Brunei is the Department of Revenue under the Ministry of Finance.
Personal Income Tax
| Income Bracket (BND) | Tax Rate |
|---|---|
| 0 - 40,000 | 0% |
| 40,001 - 60,000 | 5% |
| 60,001 - 80,000 | 10% |
| 80,001 - 100,000 | 15% |
| 100,001 and above | 20% |
| Taxpayers in Brunei are entitled to various deductions and allowances, including a personal relief of BND 4,000 and a child relief of BND 2,000. Filing requirements are relatively straightforward, with taxpayers required to submit their tax returns by April 30 of each year. Taxpayers can also claim deductions for mortgage interest and charitable donations. |
Corporate & Business Tax
- The corporate tax rate in Brunei ranges from 3.5% to 20%, depending on the type of business and the level of income.
- Small businesses with an annual turnover of less than BND 1 million are eligible for a reduced corporate tax rate of 3.5%.
- Brunei has several free zones, including the Brunei International Financial Centre and the Seri Begawan Religious Teachers University College, which offer exemptions from certain taxes and other incentives.
- Businesses in Brunei are required to register with the Registry of Companies and obtain a business license before commencing operations.
- Companies are also required to file their tax returns on a calendar year basis, with the tax year ending on December 31.
VAT / Sales Tax
- Brunei does not have a value-added tax (VAT) or goods and services tax (GST), but a sales tax is applied on certain goods, including liquor, tobacco, and motor vehicles.
- The sales tax rate ranges from 5% to 30%, depending on the type of goods.
- Certain goods, including basic necessities such as food and clothing, are exempt from sales tax.
- Tourists may be eligible for a sales tax refund on certain purchases, provided they meet certain conditions.
For Expats & Foreign Workers
- To be considered a tax resident in Brunei, an expat must be physically present in the country for at least 183 days in a calendar year.
- Brunei has double taxation treaties with 25 countries, which can help reduce the tax burden on expats.
- Expats are required to obtain a work permit and register with the Department of Immigration before commencing work in Brunei.
- Expats may be eligible for certain tax allowances, including a housing allowance and a travel allowance.
- Social security contributions are mandatory for all employees, including expats, and are used to fund retirement benefits and other social security programs.
- Expats are required to remit their income to Brunei within a certain timeframe, and may be subject to penalties if they fail to do so.
Crypto & Investment Income
- Investment income, including dividends and interest, is subject to tax in Brunei.
- Capital gains are included in income and subject to tax, but there are no specific rules governing the taxation of cryptocurrency.
- Taxpayers are required to declare their investment income on their tax returns, and may be subject to penalties if they fail to do so.
- Brunei has implemented anti-money laundering and know-your-customer regulations to prevent the use of cryptocurrency for illicit activities.