Merchants overseas have been informed by the Barbados Revenue Authority (BRA) that they can now collect value added tax (VAT) on goods and services purchased online by Barbadians.
Effective December 1, Government enacted the Value Added Tax (Amendment) Act, 2019, which makes provision, in certain cases, for the collection of VAT from the sale of goods and services for consumption in Barbados.
BRA has informed all overseas merchants conducting, facilitating or participating in transactions utilising all payment methods, such as credit cards, debit cards, charge cards or prepaid cards, for the purchase of goods or services for consumption in Barbados, of the provision.
All overseas merchants to which the legislation applies must register with BRA’s Tax Administration Management Information System.
Thereafter, all overseas merchants shall charge, collect and remit VAT on goods and services which have been purchased for consumption in Barbados.
They will also be required to file VAT returns with the Authority for reconciling the VAT charged and collected on its behalf and the VAT actually remitted to it.
The overseas merchants must comply with the requirements under the Value Added Tax Act and have the necessary accounting systems and processes in place to account for and complete an accurate and timely filing of a VAT return.
In addition, they must immediately notify BRA in writing where VAT on goods and services is wrongfully charged and collected, but they are not required to appoint a local agent to facilitate tax matters in Barbados.
The VAT is to be remitted to BRA by the 21st day of January, April, July and October.