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Saint Lucia: Withholding tax on payments to nonresident parent company upheld (Caribbean Court of Justice decision)

Payments characterized as services income subject to withholding tax

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January 7, 2026

The Caribbean Court of Justice in November 2025 upheld the imposition of withholding tax on payments by a bank operating in Saint Lucia to its Canadian parent company.

The court characterized the payments as “management charges," and thus services income subject to withholding under Saint Lucia's Income Tax Act and rejected the taxpayer’s argument that the payments were merely reimbursements.

The court also classified interest expenses as "cost of sales," limiting their deductibility.


For more information, contact a KPMG tax professional in the Eastern Caribbean:

Marianne Greenidge | mariannegreenidge@kpmg.bb

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