The current IRD VAT page says a person making commercial supplies of TT$600,000 or more in the preceding 12 months, or with evidence that projected supplies will exceed TT$600,000 in a 12-month period, must apply for VAT registration. VAT-registered businesses collect VAT on standard-rated supplies, file VAT returns and keep the required records.
Use the current IRD threshold, not an old web page
The current Inland Revenue Division VAT registration page states a threshold of TT$600,000 as of 1 January 2023. It applies where commercial supplies in the preceding twelve-month period reach the threshold or where the business can show that projected supplies will exceed it within a twelve-month period.
Some older government service pages still show an earlier TT$500,000 figure. Because the IRD's current VAT page is the tax authority's live VAT guidance and expressly identifies the 2023 change, use TT$600,000 for current planning and confirm any material tax decision directly with IRD or a qualified tax adviser.
VAT registration is separate from business registration
Registering a business name or incorporating a company does not automatically make the business VAT registered. The Companies Registry establishes the registered business or company. VAT is administered by the Inland Revenue Division under the VAT legislation.
The practical question is therefore not “Is my business registered?” It is “What commercial supplies am I making, what is my twelve-month turnover or forecast, and do the VAT rules require registration?”
The standard VAT rate is 12.5%
IRD states that VAT is charged at a standard rate of 12.5% on taxable supplies that are not zero-rated or exempt. Registered persons collect VAT from customers, account for output VAT, and may deduct eligible input VAT paid on business purchases under the VAT rules.
Do not add VAT to invoices merely because the business has crossed the threshold informally. The business should follow the registration process and issue tax invoices in accordance with IRD requirements once registered.
What IRD currently asks for when registering
The current VAT registration guidance separates requirements by business type. For a sole proprietor, the page lists form IA-001, valid identification and evidence of income/trading. For companies, partnerships and other organisations, the page lists AOI-002, DP-003 and valid identification for company directors. The VAT application also requires documentary evidence of income above the VAT threshold.
The exact evidence should support the turnover position. Examples can include accounting records, invoices, bank records, contracts or forecasts, depending on the business and the basis of the application.
Forecast registration matters for growing start-ups
A new business does not necessarily have to wait until a completed twelve months of sales proves the threshold. IRD expressly includes applicants with evidence, such as a sales forecast, showing supplies will exceed TT$600,000 in a twelve-month period.
This is where a well-supported forecast matters. The assumptions should connect to the actual business model: sales volume, prices, contracts, seasonality and launch timing. A forecast created solely to reach a desired tax conclusion is poor evidence.
VAT changes the bookkeeping discipline of the business
IRD's VAT guidance says VAT-registered businesses should display the VAT Registration Certificate, issue tax invoices, keep proper books and records, and retain records for the prescribed period. IRD's live VAT page states that books and records should be kept for six years or three years from filing the returns, whichever is later.
That means VAT registration should be coordinated with bookkeeping and invoicing before the first VAT period becomes due. A business that cannot distinguish VAT-inclusive revenue, VAT-exclusive sales, input VAT and output VAT will struggle to file accurately.
When VAT returns are due
IRD states that VAT returns should be filed by the 25th day of the month following the end of the tax period, with the VAT liability paid by the due date where applicable.
Your assigned tax period should be confirmed from IRD records. Build the deadline into the same compliance calendar used for PAYE, NIS, annual returns and other recurring obligations.
VAT, BIR and PAYE solve different problems
| Registration | Purpose | Typical trigger |
|---|---|---|
| BIR / Company File Number | Taxpayer identification and income/corporation tax administration | Operating as an individual/sole trader, partnership or company under IRD rules |
| PAYE | Employer withholding and remittance of employee income tax | Hiring employees where PAYE rules apply |
| VAT | Tax on taxable commercial supplies | Meeting the current VAT turnover/forecast threshold and VAT rules |
BizReg currently offers BIR & PAYE Registration Support. For VAT-specific administrative support, use the contact page to confirm the service scope before purchasing another product.
Before applying, answer these five questions
- What exactly does the business sell, and are the supplies standard-rated, zero-rated or exempt?
- What were gross commercial supplies in the last twelve months?
- What does the next twelve-month forecast show, and what evidence supports it?
- Are the bookkeeping and invoicing systems ready to account for VAT?
- Who will prepare and file the VAT returns on time?
For tax classification and treatment that depends on your particular transactions, obtain advice from IRD or a qualified tax professional.
Questions people ask
What is the current VAT registration threshold in Trinidad and Tobago?
The current IRD VAT page states TT$600,000 in commercial supplies in a twelve-month period, or evidence that projected supplies will exceed TT$600,000 in a twelve-month period.
What is the standard VAT rate?
The current standard rate published by IRD is 12.5%.
Does registering a company automatically register it for VAT?
No. Company incorporation and VAT registration are separate processes administered by different authorities.
When are VAT returns due?
IRD states that VAT returns are filed by the 25th day of the month following the end of the assigned tax period.
References
Requirements can change. Check these references for current details.