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Bahamas tax guide 2026

Bahamas tax for companies: no income tax, and the one test that matters

Updated 10 November 2026Business Licence Act 2023 rulesAbout 10 minutes to read
The short answer

A Bahamas IBC pays no income, profit, capital gains or dividend tax, because The Bahamas has none.

One charge can still reach it: business licence tax, but only if the company does business in or from The Bahamas. The 15% top-up is for groups with EUR 750 million of revenue.

Does licence tax reach me? My report deadline
No income tax 0% Bahamas tax on company profit, gains and dividends No income tax is legislated. Business licence tax reaches an IBC only if it does business in or from The Bahamas.

The Bahamas has no income tax, so most guides stop at "0%". The charge they skip is business licence tax, and whether it reaches your IBC turns on one question: does the company do business in or from The Bahamas? Here's that test, and the rest of the system, from the Department of Inland Revenue's IBC guidance and the Business Licence Act 2023.

Key takeaways

  • There is no income, corporate, capital gains or withholding tax; none is legislated.
  • Business licence tax applies to an IBC only if it does business in or from The Bahamas.
  • Caught, an IBC pays US$2,500 on outside revenue up to US$1 million, then 0.25%, capped at US$100,000.
  • Consulting and other professional services count as local revenue at the regular rates.
  • Every IBC files a substance report within nine months of its year end.
  • The 15% top-up tax reaches only groups with EUR 750 million of revenue.
Chapter 1

Bahamas business licence tax: in or from The Bahamas?

US$150,000 fees, run from abroadIBC
Corporate income taxUS$0
Withheld on dividends to youUS$0
Business licence taxUS$0
Annual government feeUS$350
Your own country may tax what you take out. Where you live: pick it

The Inland Revenue looks at where the business is actually run: revenue earned from activity on the islands, day to day management there, a fixed place, or personal services there, the same test sections 9(1) and 32 of the Act set. Board meetings in Nassau alone don't count. Where the books are kept is the one point the guidance leaves open. Answer four questions.

You do the work
Office, staff or a fixed place in The Bahamas
Customers in The Bahamas
The books are kept
1
Key takeaway

Where the business is run decides it, not where the company is registered.

Chapter 2

Bahamas IBC licence tax rates, if it applies

US$2,500A year on revenue from operations outside The Bahamas, up to US$1 million
0.25%Above US$1 million, capped at US$100,000
0% to 1.25%On local revenue, including consulting and sales to people on the islands, by turnover band
US$15,000Minimum for trading your own money as a business, or 0.25% if higher

The rates sit in the Second Schedule of the Business Licence Act 2023. Renewal is due by 31 January and the turnover return by 31 March, as the Inland Revenue's licence FAQs set out. Our Bahamas IBC page works out the amount for your revenue.

2
Key takeaway

If it's caught, a tax on revenue, not profit. Consulting counts as local.

Chapter 3

Bahamas economic substance report: deadline and test

Under the Commercial Entities (Substance Requirements) Act 2023, every IBC reports once a year through its registered agent. What it has to show depends on what it does. The substance guidelines set the penalties: US$5,000 plus US$500 a day for not reporting, more for false reports, up to strike off.

The company
3
Key takeaway

Every IBC reports once a year, within nine months of its year end.

Chapter 4

Bahamas 15% minimum tax: who pays it

A founder's IBC
A large multinational group
  • EUR 750 million of revenue in two of the last four years
  • Topped up to 15% on Bahamas profit, mostly from 2025
  • Returns even at nil, and instalments from July 2026

A wider corporate income tax was floated in a Green Paper of May 2023 and put on hold in the Ministry of Finance's August 2024 paper. No bill has followed.

4
Key takeaway

The 15% top-up is for groups with EUR 750 million of revenue.

Chapter 5

Bahamas IBC tax at home: what your country can claim

The Bahamas has no general tax treaties and withholds nothing when the company pays you, so the only tax on your profit is your own country's. It can tax the dividends you take, tax the company itself if it's managed from there, or apply its controlled company rules. Banks also report the company's accounts to your tax office under the CRS.

5
Key takeaway

No treaties and no tax at the source. Your country decides the rest.

Chapter 6

Bahamas VAT, stamp duty and property tax

10%VAT since January 2022, 5% on some medical supplies; registration once Bahamas supplies pass US$100,000
US$0VAT for an IBC that supplies nothing in The Bahamas, on our reading
2.5% to 10%On buying Bahamas property, by value
YearlyReal property tax on land you own there, due by 31 March
6
Key takeaway

10% VAT, only for supplies in The Bahamas above US$100,000.

Chapter 7

Moving to The Bahamas: what changes for your IBC

No personal income tax is the draw. The catch: once you live and work in Nassau, the company is run from The Bahamas, so it needs a business licence and Bahamas Investment Authority approval. Estimate the yearly cost.

US$
Earned from
US$

The estimate applies the licence tax in the Second Schedule of the Act to the whole turnover at its band's rate, and National Insurance at 6.65% employer and 4.65% employee up to the US$830 weekly ceiling from July 2026.

7
Key takeaway

Move to Nassau and the company starts doing business from there.

Chapter 8

Is The Bahamas a tax haven?

  1. March to May 2018EU blacklistThen the watch list until February 2020.
  2. October 2018 to December 2020FATF grey listRemoved after anti money laundering reforms.
  3. October 2022 to 20 February 2024EU blacklist againOver how substance rules were enforced.
  4. 9 October 2026On neither EU listAnd off both FATF lists after the October 2026 plenary.

One weak spot remains: the OECD rated The Bahamas non-compliant on automatic exchange of account data after a 2025 review, as the Securities Commission told the industry in March 2026, and banks notice. Our Bahamas IBC bank account guide shows how to prepare for their questions.

8
Key takeaway

Off the EU blacklist since 20 February 2024, off FATF lists since 2020.

Chapter 9

Bahamas tax questions, answered

?!
Does The Bahamas have corporate income tax?
No. No corporate income, capital gains or withholding tax is legislated. Only groups with EUR 750 million of revenue pay the 15% top-up.
Does a Bahamas IBC pay business licence tax?
Only if it does business in or from The Bahamas. An IBC run from abroad with no Bahamian customers or office is outside it, according to the Inland Revenue.
How much is the Bahamas licence tax for an IBC?
US$2,500 a year on outside revenue up to US$1 million, then 0.25% capped at US$100,000. Local revenue, consulting included, pays 0% to 1.25%.
When is the Bahamas substance report due?
Within nine months of the financial year end, so 30 September for a December year end, filed through the registered agent. The annual fee, late increases and strike off dates are in Bahamas annual fees and filings.
What is the VAT rate in The Bahamas?
10% since 1 January 2022, down from 12%. Registration is required once Bahamas supplies pass US$100,000 in 12 months, according to the Inland Revenue's VAT FAQs.
Is The Bahamas still on the EU tax blacklist?
No. It was removed on 20 February 2024 and is on neither EU list as at 9 October 2026.
Do you file the substance report?
Yes. Our Bahamas IBC includes the yearly substance report and the government fee.

Changelog

  • 10 November 2026: first published.
  • 13 November 2026: official sources linked in the text.
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