Personal Income Tax - Salary & Wage

Earners

What is the income tax threshold?

The income tax threshold as from 1st June 2009 is FJ$15,000.

You should lodge a return if tax was deducted so that an assessment can be made to determine if all or part of it should be refunded.

Whether your income is above or below FJ$15,000, a return must be lodged so that a proper assessment can be done by the Authority.

Any tax paid overpaid will be refunded and any tax short paid will be recoverable from you.

Tax rates

Normal tax is levied on Chargeable income ( i.e. Total income less allowance).

There are separate rates of normal tax for resident and non-resident sole traders.

What categories of income derived by individuals are subject to tax?

There are three main categories of income derived by individuals, namely:

• income from employment.
• income from property.
• income from business/investments.

Income from employment

For taxpayers that receive income from employment, their total income will include income from emoluments. This includes:

• salary, wages, overtime, bonus, remuneration.
• gratuities.
• the estimated annual value of any quarters or board or residence.
• the estimated annual value of any other allowance granted in respect of employment (in cash or kind).
• stipend.
• commission, or other amounts for services.
• directors' or management fees.
• retiring allowances or pension, accruing in, derived from or received in Fiji.

All incomes are subject to tax however some payments are exempt from tax as special provisions for exemptions are available in the Income Tax Act.

Only income from employment and investments such as interest and dividend income should be returned on the Form S.

Emoluments does not include any salary or share of profits arising from a trade, business, profession or vocation carried on by any person either by himself or in partnership with any other persons.

An employee who also receives income from business or share of estate/ partnership must lodge a business return (Form B), instead of the salary and wage earner return (Form S).

Income from property

This includes the following:

• rental/lease income (excluding native lease), whether derived individually, through a Real Estate Agent or the government.

 Income from business/investments

 This includes the following:

• interest received from savings and term deposits with financial institutions.
• interest received from loans/money lending whether licensed or not.
• dividends received from shares/investments.

Residents & non-residents

A person is regarded as a resident if his/her permanent home or place of residence is in Fiji. If a person is not normally resident in Fiji , he/she may be regarded as a resident if he/she has actually been in Fiji , continuously or regularly during more than one-half of the income year. He/she must satisfy the Commissioner that he/she will take up residency in Fiji.

Residents are taxed on their income from all sources. A resident for income tax purposes is a person (other than a company) who resides in Fiji , is domiciled in Fiji or has been in Fiji for more than half of the income year.

Non-residents are taxed only on their income derived or earned in Fiji.

Example:

An individual, who is a medical doctor, is granted leave by his employer to work in Australia for 2 years. He does not derive any income in Fiji during that period.

Since he is only working temporarily in Australia , he is still a Fiji resident for tax purposes, therefore is required to lodge returns for the income received in Australia. That income is taxable in Fiji and he will be allowed a credit for the tax paid in Australia. 

Information for individuals who are not Fiji residents for tax purposes who earn Fiji income

Double taxation of residents is avoided by allowing credits for foreign tax paid on income derived from countries with which Fiji has tax treaties. Fiji allows unilateral relief from double tax on income from non-treaty counties, provided the income has been subject to tax in that other country.

Fiji has entered into agreements for the avoidance of double tax with the United Kingdom, New Zealand, Japan, Australia, South Korea, Malaysia, Papua New Guinea and Singapore.

Who should lodge an income tax return?

All salary and wage earners should lodge a form S return regardless of the income amount earned during the year.

Before you send us your return, you should check that the necessary spaces have been filled and that your employee certificate and any documents to support your claims for exemption, deduction or allowance are attached.

The section on declaration must be completed and signed as well.

Once your return is received, it becomes the property of the Authority and as such, the Authority is obligated under the secrecy provisions of the Income Tax Act to refrain from revealing to any person any documents or information without lawful excuse. This prohibition would include the making of copies of returns when requested by the taxpayer.

The form can be hand delivered to any of our Customer Enquiry Centers or sent by post. You do not need to buy a stamp for the envelope, as correspondence addressed to the Commissioner will be carried by Post Fiji free of charge.

When do I lodge a tax return?

You must lodge your return for the immediately preceding year by 31 st March each year.

Example:

Return for Year ending 31 December 2009 was due on 31 st March 2010

Return for Year ending 31 December 2008 was due on 31 st March 2009

Return for Year ending 31 December 2006 - due on 31 st March 2007

What penalties apply for failing to lodge your tax return by the due dates?

If you lodge your return late, you will be charged Late Lodgement Penalty of 20% on the amount outstanding on the return.

If you cannot lodge your return by the due date then you may request for and extension of time. Application must be made in writing to our Lodgment Enforcement Unit.

What offences apply for not lodging your tax return?

If you do not lodge your return at all, then this will be regarded as an offence. The penalties upon conviction are:

• a fine of FJ$1000 or
• imprisonment for 3 months or
• both the above

What documentary evidences do I need to submit with my Income tax return?

The Salary & Wage Earner Return (Form S) should be lodged together with the following documentary evidences:

• original employee certificate.
• employers certificate of salary or wages paid for migrating taxpayers excluding civil servants.
• original dividend certificate if earning any form of dividends during the year.
• original bank interest certificate if earning bank interest during the year.
• certified copy of certificate (birth/marriage) for any first time claims.
• statement of Insurance premiums paid during the year to your insurer if you have your own insurance policy or had been making deductions relating to your wife or child's life insurance policy. 

What records do I need to keep?

Individual taxpayers should always maintain a copy of their yearly tax return lodged with FIRCA together with all relevant details. All correspondence to and from FIRCA is also to be filed for your own record.

This will enable you to compare your computation of the tax payable or refund due when you receive your notice of assessment. Once your return is received, it becomes the property of the Authority and as such, the Authority is obligated under the secrecy provisions of the Income Tax Act to refrain from revealing to any person any documents or information without lawful excuse. This prohibition would include the making of copies of returns when requested by the taxpayer.

How do I calculate the final tax payable/refund amount?

Instructions

How will I be notified of the final tax payable/refund amount? 

You will be notified of the final tax payable or refund amount through a Notice of Assessment which will be posted to your last known postal address. 

Can I request for an amendment to my income tax return?

A request for an amendment to your income tax return is only allowed if it is lodged with FIRCA within six (6) years from the end of year of assessment. A refund will only be made if it relates to an amendment for any of the three years immediately preceding the 2007 Income Tax Assessment.

Can I lodge an Objection to my Income Tax Assessment?

An objection to an Income Tax Assessment will only be dealt with by the Authority if it is lodged within sixty (60) days from the date of the Notice of Assessment (NOA).

Direct Deposit of Refunds

As from 01.01.2010 it is mandatory that all refunds for Salary and Wage earners will be deposited into your bank account. The will be no more issuance of refund cheques.

You are to insert the details of your bank account (bank name, branch & account #) in your yearly tax return.

When and how should I pay my tax?

Any tax payable amount should be settled within thirty (30) days from the date of Notice of Assessment. Should you fail to settle within the due date your case will be referred to our Debt Management Service for recovery purposes