Cuba Corporate Income Tax

Tax on profits (Impuesto sobre Utilidades)

Companies, MIPYMEs and other legal persons pay the Impuesto sobre Utilidades at a general rate of 35% on net taxable profit under Law No. 113. Reduced and increased rates apply to foreign-investment entities and natural-resource activities respectively.

• General corporate tax rate — 35% on net taxable profit % (Ley No. 113 del Sistema Tributario)
• Tax base — Net profit = total income less documented deductible expenses; settled annually by sworn declaration (Declaración Jurada) with quarterly installments during the year (Ley No. 113 del Sistema Tributario)
• Natural resources / mining rate — Rate may be increased up to 50% on profits from mining or exploitation of natural resources % ((approx — confirm)) (Ley No. 113 del Sistema Tributario)
• Foreign-investment (joint venture) rate — 15% on net profit for joint ventures and foreign-investment entities under the Foreign Investment Law % ((approx — confirm)) (Ley No. 118 de la Inversión Extranjera)
• Foreign-investment tax holiday — An exemption period (commonly cited as 8 years) from the tax on profits may be granted to new joint ventures / international economic association contracts under the Foreign Investment Law ((approx — confirm)) (Ley No. 118 de la Inversión Extranjera)
• MIPYME / private company rate — 35% on net profit (general Impuesto sobre Utilidades), settled annually with quarterly installments % (Ley No. 113 del Sistema Tributario)
• Withholding tax on dividends — Dividends distributed to MIPYME partners are taxed via personal income tax (max marginal ~20%); a separate dividend withholding tax on foreign shareholders should be confirmed against statute ((approx — confirm)) (Ley No. 113 del Sistema Tributario)
• Withholding tax on interest / royalties to non-residents — Payments of interest and royalties to non-residents may be subject to withholding; rate to be confirmed against statute and any applicable treaty ((approx — confirm)) (Ley No. 113 del Sistema Tributario)
• Filing / payment deadline — Annual sworn declaration due by 31 March (corporate Declaración Jurada); quarterly advance payments during the year ((approx — confirm)) (Ley No. 113 del Sistema Tributario)
• Territorial contribution for local development — 1% of gross income (Contribución Territorial para el Desarrollo Local) payable by state and private entities % (Ley No. 113 del Sistema Tributario)