[email protected]

• ENG
• PAP

Back to all topics

Manage your business

• Manage your finances
• Hire employees
• All about tax payments
• Stay legally compliant
• Buy assets and equipment
• Marketing and Sales
• E-commerce
• Stay safe from cyber threats
• Prepare for emergencies
• Close or sell your business
• Employ someone with a disability

All about tax payments

The type of taxes your company will have to pay is determined by its business structure.

Contents

• Income tax – (“Inkomstenbelasting” – “IB”)
• Profit tax – (“Winstbelasting” – “WB”)
• Sales tax (“BBO/BAVP/BAZV”)
• Wage tax – (“Loonbelasting” – “LB”)
• Social security contributions (“AOV/ AWW” and “AZV”)
• Summary wage statement and Summary statement of services provided by third parties;
• Online platform “Bo Impuesto” (“BOi”)
• Tips

---

Income tax – (“Inkomstenbelasting” – “IB”)

A sole proprietorship or a general partnership (“vof”) is required to pay income tax, and the tax rate is determined by the amount of income.

Other income tax-related obligations:

• filing an income tax return;
• receiving an assessment;
• paying in case of profit;
• mandatory: the financial statements are based on the invoice system.

---

Profit tax – (“Winstbelasting” – “WB”)

A corporation (N.V.), limited liability company (V.B.A.) or another legal entity has to pay profit tax. Since 2016, the profit tax is 25% based on the profit of the company.

Other profit-tax related obligations:

• filing a profit tax return for your company;
• paying at once on the basis of self-assessment;
• mandatory: the financial statements are based on the invoice system;
• difference between a provisional return and a final return.

Difference between a sole proprietorship and a legal entity acting as the director:

• Sole proprietorship: the director (or his or her spouse) is not employed by the company.
• Legal entity: the director is employed by the company and will have to pay wage tax and social security contributions (the director is an employee of the company).

Director of a legal entity:

• If he or she is employed by the company, he or she must pay wage tax and social security contributions.
• If he or she is not employed by the company, he or she will be entitled to a profit distribution.

Sole proprietorship	N.V./V.B.A.
Income tax (“IB”)	Profit tax (“WB”)
Tax % is based on income tax table	Tax % is 25%
Your assets (house, car, etc.) can be attached in the event of bankruptcy. The assets of the business and the assets of the entrepreneur are indistinguishable.	If the company goes bankrupt, the assets of the company will be attached first. If this is not enough, the director may be held liable for the company’s outstanding debts.
A notarial deed is not required to start a sole proprietorship.	A notarial deed is required to start an N.V./V.B.A.

Special rules for the sole proprietorship and the N.V./V.B.A.

Investment credit

Investment > AWG 5,000.00
Credit: 6% of the investment

Loss setoff

Till 5 years back

---

Sales tax (“BBO/BAVP/BAZV”)

• BBO/BAVP/BAZV is for all businesses that sell products and/or services in Aruba.
• BBO/BAVP/BAZV is calculated based on the received (cash register) sales of products and/or services.

The rate as of July 1, 2018 is as follows:

• BBO 1.5%
• BAVP 1.5%
• BAZV 3%
• Every month, the entrepreneur is responsible for filing the return.
• By the 15th of the following month, you must have filed your return and paid your tax.
• Companies exempt from BBO/BAVP/BAZV are obligated to file their return every month. Click on the following link

---

Wage tax – (“Loonbelasting” – “LB”)

Wage tax is a form of direct taxation. The employee is the taxpayer, and he or she is responsible for paying taxes. Through his salary, the employee pays his or her own tax. This amount will be deducted from his or her wages. This tax amount is paid by the employer as an unpaid tax official.

Wage tax
Statutory amendments in force since January 1, 2019

	2018	2019	2020
Personal tax deduction	Awg. 20.455,-	Awg. 27.751,-	Awg. 28.861,-
Rate group	2 rate groups based on each situation	1 rate group	1 rate group
Income brackets	14 brackets	4 brackets	4 brackets

---

Social security contributions (“AOV/ AWW” and “AZV”)

In addition to the wage tax, social security contributions (“AOV/AWW” and “AZV”) are deducted from the employee’s wages. The income tax, as it is referred to, is paid to the Tax Department in a lump sum by the employer/owner.

Calculation of the social security contributions “AOV/AWW” and “AZV”:

“AOV/AWW” table:

Withholder

Income limit for chargeable social insurance contributions	Awg. 85.000,-
Maximum contribution	Awg. 13.175,-	15.5%
Employer’s share	Awg. 8.925,-	10.5%
Employee’s share	Awg. 4.250,-	5.0%

Self-employed person

Income limit for chargeable social insurance contributions	Awg. 85.000,-
Maximum contributions	Awg. 13.175,-	15.5%

“AZV” table:

Withholder

Income limit for chargeable social insurance contributions	Awg. 85.000,-
Maximum contribution	Awg. 8.925,-	10.5%
Employer’s share	Awg. 7.565,-	8.9%
Employee’s share	Awg. 1.360,-	1.6%

Self-employed person

Income limit for chargeable social insurance contributions	Awg. 85.000,-
Maximum contribution	Awg. 8.925,-	10.5%

The calculation of the “AOV/ AWW” and “AZV” contributions is based on the income for social insurance purposes.

The income for social insurance purposes is the salary after deducting:

• employment-related expenses (3% up to a maximum of AWG 1,500.00);
• employee’s contribution to the pension fund;
• total of the contribution to the savings and provident fund (5% up to a maximum of AWG 3,360.00).

An example calculation:

• gross income per month is AWG 8,000.00, which falls in rate group 2 (rate group 2);
• the income for social insurance purposes is (12 x 8,000.00) AWG 96,000.00
• vacation pay and a 13th month are not included.

---

Summary wage statement and Summary statement of services provided by third parties;

• The summary statement of services provided by third parties and the summary wage statement must be submitted once a year (in respect of the past year). If they are not submitted, a fine of up to AWG 10,000.00 will be imposed.
• A summary wage statement contains all information about persons who have been employed by you in any year (wages, social security contributions of each person in respect of the entire past year).
• A summary statement of services provided by third parties provides information about a company’s expenses that are not related to a specific job contract.

---

Online platform “Bo Impuesto” (“BOi”)

BOi is an online platform that allows business owners to submit their monthly tax forms in a completely digital format. You can submit the following forms:

• BBO/ BAVP/BAZV and wage tax return.
• Summary wage statement.
• Summary statement of services provided by third parties.

The services are available from Monday through Sunday, from 7:00 AM to 11:00 PM.
E-mail: [email protected]
Telephone: 522-7437

For detailed information visit the website of BOi.

---

Tips

• Have your accounts kept by a good accountant
• When you receive a letter from the Tax Department, open it yourself and read the content before you submit it to your advisor (accountant)
• Retain the records for 10 years
• Always fill out the tax return and file it on time
• When making an online payment, make sure to describe payment references correctly!
• For more detailed information, visit the website of DIMP: www.impuesto.aw

Scroll To Top

© 2024 Idea: Iniciativa pa Desaroyo di Empresa Arubano | Disclaimer

By orbitalnets