July 31, 2014  
 
 
Your Income - Making Statutory Payments

NCOME TAX (P.A.Y.E.) - As of January 1, 2010, the Government of Jamaica increased the Tax Threshold to J$441,168.00.  This means that Income Tax (P.A.Y.E.) is not paid on this portion of your salary each year. 

The J$441,168.00 is broken down in a monthly amount of Tax Relief. This amount is currently $36,764.00 per month and you do not pay Income Tax (P.A.Y.E.) on this portion of your salary each month.

This figure of J$36,764.00 will be applied before your P.A.Y.E. deduction is calculated.

NATIONAL INSURANCE SCHEME (N.I.S.) - As of August 2, 2010, the government moved the Insurable Wage Ceiling to J$1,000,000.00 per annum.

An Example of how this works in Real Life

The employer will deduct the various Statutory payments from your salary. These are Government Taxes and they MUST be paid or legal penalties will apply.

  Employee Employer
National Insurance Scheme (N.I.S.) 2.45% 2.45%
National Housing Trust ( N.H.T.)  2% 3%
Education Tax  2% reduced by the amount of N.I.S.  
Income Tax (P.A.Y.E.) 25% reduced by the N.I.S. amount and the Tax Relief amount  

The calculations below show the breakdown for deductions and salary amount.

Salary - J$85,000 Gross per month

N.I.S.              2.45% x $85,000.00 = $ 2,083.34

N.H.T.             2% x $85,000.00 = $ 1,700.00

Ed. Tax          $85,000.00 less N.I.S. - $2,083.34 x 2% = $ 1,658.33

P.A.Y.E.          $85,000.00 less N.I.S. less Tax Relief - $ 36,764 x 25% = $ 11,538.17

Total Statutory Deductions paid by the Employee/Worker = J$ 16,979.84                

Monthly Net (Take Home) Pay = J$ 68,020.16

N.B. As rates are subject to change, please verify with the Income Tax Department

 
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