How can an Umbrella Company Help with Contracting in Bahamas?
Most freelance workers aren’t superheroes who successfully tackle these issues all on their own. There are companies who specialise in helping workers make the most out of their contracts.
They’re called Umbrella Companies (or, contractor management companies).
Basically, an Umbrella Company acts as your full-time employer, even though you maintain your independence as a contractor. They collect and filter payments from your clients, filtering out the necessary social security and fees. You send them your timesheets, and they send you payments.
Because they act as your “employer,’ they can sponsor you and provide a single work permit for multiple contracts in the Bahamas. Even better, most are experts in Bahamian and expat tax law, meaning they’ll also help you optimise your earnings in the Bahamas.
Although the Umbrella Company is technically your “employer,” you’re essentially freeing yourself to work even more independently. You still dictate your contracts, your hours, your schedule. The Umbrella Company simply filters out the time-consuming admin and immigration issues, allowing you to focus on your new contract.
Can I Organise My Taxes and Work Permit Myself?
Generally, you need to have an employer sponsor in order to secure the appropriate work permit and work visa for the Bahamas.
If you’re working independently, it can be difficult to find clients willing to sponsor you. Moreover, even if your client can do this, you’ll need a new sponsor each time you decide to take on a new contract. Of course, every new sponsor will mean more paperwork.
Also, are you familiar with the intricacies of the tax system in the Bahamas, as well as your own country’s laws on overseas earnings? If so, good on you!
However, if you’re like the rest of us, figuring out (much less reducing) your tax liability in the Bahamas and your home country can seem like full-time work in itself.
A Contractor’s Guide to Taxes in Bahamas
One of the most consistently challenging aspects of contracting in the Bahamas is complying with the country’s tax system. As well as paying tax in the Bahamas, you might also still be eligible to pay some tax in your home country, and understanding the legislation behind this can be a challenge.
How do I calculate my taxable income in Bahamas
If you’re working in the Bahamas under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in the Bahamas for you and then send you a net wage. Your income tax, public health insurance, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in the Bahamas, but contractors may not be offered this service because of their short stay with each employer.
Anybody who can’t pay their tax in the Bahamas through PAYE is left with the prospect doing everything themselves.
Do you know much about Bahamian Tax Law? Does the Bahamas have a tax treaty with your home country? You will need to find out or find someone who can help!
Tax Filing as a Contractor in Bahamas
|When Do You Need to Lodge Your Tax Return?||N/A|
|Tax Filing Deadline||N/A|
|Can you file it online?||N/A|
How to File Taxes in Bahamas as a Contractor
There are taxes on employment income in the Bahamas.
Tax Figures in Bahamas
|Currency||US Dollar (USD) or Bahamian Dollar (BSD)|
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There are taxes on employment income in the Bahamas.
Tax Residency in Bahamas
When do you become a tax resident in Bahamas
You become a tax resident in Bahamas when:
Since there is no personal income tax in the Bahamas, residence is not defined for personal income tax purposes.
You become a resident in the Bahamas when:
- You make a minimum $500,000 investment in a real estate purchase (standard procedure); or
- You make a minimum $1,500,000 investment in a real estate purchase (fast-tracked procedure).
Does the 183 day rule apply in Bahamas
Am I taxed on my global income in Bahamas
Can you set up your own Limited Company in Bahamas?
|How long does it take to set up||21.5 days|
|How much does it cost||BSD1,860 + BSD100 (on the first BSD5,000 of authorised capital) + BSD5 (for every additional BSD1,000 of authorised capital)|
|Is it easy?||Starting a Business Rank: 108/180 (Source: World Bank)|
Tax Calculator in Bahamas
If you are a contractor and want a calculation on your tax and net retention in the Bahamas, we can supply it to you free of charge.
Using an Umbrella Company for Income Tax in Bahamas
Contractors in the Bahamas are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. A Bahamian umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).
The companies are experts in Bahamian taxation, and they’ll ensure that you keep the largest proportion of your earnings whilst complying with local laws. They can deal with any issues with the Bahamian tax office or tax department directly including processing your tax refund if you are eligible.
How We Can Help You with Tax in Bahamas
We work with numerous umbrella companies in the Bahamas, many of whom are experts in tax and immigration laws. If you have any questions about tax in the Bahamas, we’ll get the answers from them directly so you can rest assured you’ll be getting accurate information. We have comprehensive knowledge of the different services they provide, and can help you find the right company to handle your income tax. We help oil and gas workers, software developers, IT project managers, testers, business analysts and telecommunications contractors get tax efficient payments and sponsorship for their Bahamian work permit.
Our advice is 100 percent free, and comes with no obligations. You will be paying taxes in the Bahamas but without the overhead of directly dealing with the Bahamian tax authorities. Get in touch with us today for some reliable advice on tax in the Bahamas!
A Contractor’s Guide to Work Permits in Bahamas
Immigration is one of the primary concerns for any contractor hoping to start working in the Bahamas. Permanent employees will find it easy to get their Bahamian work permit because they’ll receive “sponsorship” for their entire stay from their prospective employer.
The Bahamian work permit, is dependent on this sponsorship because it confirms that you’ll be earning money during your stay in the country. Contracting in the Bahamas is more difficult because the work permit is tied to one employer, so you have to change it to suit each new contract. Thankfully, umbrella companies provide a convenient and effective solution to this issue.
How Does an Umbrella Company Work?
Most people want to do their work, earn their money and enjoy their spare time without taking on loads of admin in a new country. That is why an umbrella company can help.
When you’re working through an Umbrella Company, you’ll essentially be outsourcing the admin and tax issues to specialists.
While the umbrella company will charge a fee, you’ll likely end up saving more money in the long run: you’ll be able to focus on your work, expertly reduce your tax liability, and comply with all laws and regulations in Azerbaijan (which means avoiding fees, fines, or even worse penalties).
How Can We Help You?
There’s a huge variety of Umbrella Companies with different specialities and advantages in the Bahamas. How do you find the right one for your circumstances?
We work closely with Umbrella Companies all throughout Azerbaijan and match contractors with the right company for them. If you’ve already secured a contract in A, we can help you find your best match (for free). Or, we can simply give you feedback on your situation (for free).