Capital Gains Taxation in Antigua and Barbuda
Definition of Capital Gains
In Antigua and Barbuda, capital gains are defined as profits or gains derived from the disposal of capital assets. Capital assets include:
- Real estate properties
- Stocks and shares
- Bonds and debentures
- Business assets
Calculation of Taxable Capital Gains
Taxable capital gains are calculated as the difference between the selling price of the asset and its acquisition cost. The formula for calculating capital gains is:
Capital Gain = Selling Price - Acquisition Cost - Expenses
Adjustments or deductions may be allowed in the calculation of the gain, including expenses related to the sale (e.g., brokerage fees, legal fees) and any improvements made to the asset during ownership.
Tax Rates
Capital gains in Antigua and Barbuda are taxed at a flat rate of 20%. This rate applies to both individuals and corporations.
Legal Framework
The taxation of capital gains in Antigua and Barbuda is governed by the Income Tax Act, 2016. The relevant provisions are outlined in:
- Section 10(1): Definition of capital gains
- Section 10(2): Calculation of taxable capital gains
- Section 10(3): Tax rates applicable to capital gains
Policy Objectives
The capital gains tax system in Antigua and Barbuda aims to:
- Generate revenue for the government
- Ensure that individuals and businesses contribute their fair share of tax on profits realized from investments and asset disposals
- Promote investment and economic growth
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