The Government has introduced legislation, which will require banks and other financial institutions to deduct withholding tax of 20% from payments of interest to its customers. This legislation was effective from 1 January, 2013. Resident Interest Final Withholding tax has also become final tax. This means that the gross amount of any interest income paid or credited to resident individuals by a financial institution in Fiji will be taxed at a fixed rate of 20%. The tax applies on any interest above $200.00 as per (Section 17(72)of the Income Tax Act. Where Resident Interest Withholding Tax is their only source of income, bank account holders do not have to lodge income tax return
in 2014 and subsequent years as banks should have deducted the correct amount of tax from interest income. However if the RIWT has been overdeducted, the taxpayer may lodge a NRIWT/RIWT Refund Form.
Previous years withholding tax rates
|Years||Resident Rate||Non-Resident Rate|
Resident Interest Withholding Final Tax (RIWT) shall not be payable where:
Senior Citizens and Pensioners
With effect from 1st January 2014, all senior citizens (55 years old or above) and pensioners who earn interest income up to $16000 are eligible to apply for a Certificate Of Exemption from RIWT provided this is their only source of income. The requirements for pensioners and senior citizens to qualify for COE are stated below:
- must be receiving pension or had received pension from an approved fund (e.g. FNPF, Fiji government pension, other approved fund)
- total annual interest income must not be more than $16,000.00;
- current source of income must be from pension and interest only.
- must be 55 years old or above;
- total annual interest income must not be more than $16,000;
- current source of income must be from interest only;
What are the requirements for the application of RIWT Exemption Certificate?
RIWT is collected by banks from interest paid, if the source of the deposit is not exempt income. Tax exempt persons need to have a COE to avoid having RIWT deducted from their interest.A certificate of exemption will only be issued to the following bank account categories;
Before a COE will be given, the applicant must:
Where to lodge your application
The form can be hand delivered to any of our Customer Service Centres 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.
Validity of COE The Certificate is valid for 1 year from the issuance date.
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