Friday, July 25, 2014

JAMAICA TAX TREATIES | UHY Dawgen Chartered Accountants Blog

JAMAICA TAX TREATIES | UHY Dawgen Chartered Accountants Blog:

Double Taxation Treaties (DTT) are agreements between two or more countries that aim to eliminate double taxation of income or gains arising in one territory and paid to residents of another territory. DTT provide certainty of treatment for investment and trade across borders. They also help to protect a country’s taxing right and protect against attempts to avoid or evade tax.
better late than never
Jamaica has bilateral tax treaties with twelve (12) countries, namely Canada, Denmark, France, Germany, Israel, Norway, Peoples Republic of China, Spain, Sweden, Switzerland, United Kingdom and United Sates of America. Jamaica is also a member of the CARICOM multilateral tax treaty which is signed by eleven (11) jurisdictions including Antigua & Barbuda, Barbados, Belize, Dominica, Grenada, Guyana, St. Kitts & Nevis, St. Lucia, St. Vincent and the Grenadines, Trinidad & Tobago.
Below is a summary of Jamaica’s signed double taxation treaties and rates:

Taxation Treaty CountriesDividends Portfolio Investments (%)Dividends Substantial Holdings (%)Interest (%)Royalties (%)Management Fees (%)
* 10/12.5
33 1/3 company 25 individual
33 1/3 company 25 individual
Peoples Republic of China 
33 1/3 company 25 individual
United Kingdom1522.512.51012.5
United States of America 
Taxed as business profits
CARICOM (Caribbean Community) 





* 10% if received by bank 12.5% in all other cases
For all other countries not listed above, individuals will pay 25% and companies pay 33 1/3% for dividends, interest, royalties and management fees.

In addition to the above, DTT often cover several other popular areas such as Permanent Establishment, Independent Personal services, Dependent  Personal Services and Business Profits. Many of Jamaica’s DTT are similar in their layout but care should be taken when applying each as there may be small differences in the wording which affects the application.
A DTT between Jamaica and another country serves to prevent income earned in the other country by a Jamaican resident from being taxed twice and vice versa. It also makes clear the taxing rights between Jamaica and the treaty partner on different types of income arising from cross-border economic activities between the two countries.
The government uses tax treaties primarily to promote capital inflow and expand foreign trade. International trade is economically good for Jamaica and territorial double taxation can be discouraging for foreign investors as well as locals wishing to invest abroad. Jamaica’s signing of various DTT over the year goes to show that the Government believes in international trade and has made tangible moves to provide a more conducive environment for cross-border trade.
In Jamaica DTT provisions override that of local law and DTT are often times more favourable than local law. DTT usually provides for lower tax rates, income being taxed only in one jurisdiction, exemption of taxes for short periods and a tax credit for taxes paid or accrued in another jurisdiction where applicable.
The Honourable Peter Phillips in announcing the 2013/14 Revenue Measures stated that every Jamaican resident who receives dividends from a Jamaican resident company is subject to tax at 15%. Based on this, a Jamaican investor would receive no benefit from a tax treaty with countries such as Norway, UK or US if they had decided to invest in these countries instead of Jamaica, since their treaty rate for Dividends Portfolio investment is 15%. However, a Jamaican resident who receives dividends from a CARICOM member country or Peoples Republic of China or Spain would enjoy treaty benefits of a lower tax rate of 0%, 5% and 10% respectively.
Jamaicans are encouraged to explore investments in countries with which Jamaica has signed DTT and enjoy the benefits that are available.

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Tuesday, July 22, 2014

Innovations in access to finance for SMEs | UHY Dawgen Chartered Accountants Blog

Innovations in access to finance for SMEs | UHY Dawgen Chartered Accountants Blog:

In the years since the 2007–8 financial crisis, the issue of access to finance for small and medium-sized enterprises (SMEs) has taken on a new prominence, having been formally recognised as an issue of pressing importance at the G20 summit in Pittsburgh in September 2009. Of course, one of the key reasons for the increased attention that this subject now receives is the well-documented problems of the banking system in many parts of the world following the ‘credit crunch’ of 2008–9. This dimension of the financial crisis – and the policy and regulatory measures subsequently put in place – has had a notable effect on the ability and willingness of the conventional banking system to fund SMEs in some parts of the world, and has therefore contributed to the emergence of innovative alternative forms of SME finance. In other regions, a general lack of development in commercial banking and other sorts of financial infrastructure has been a more pressing issue.
Even so, other factors beyond the crisis of the developed world’s banking system have also contributed to the initiatives that this paper will discuss, notably technological developments and increasing access to online services; electronic data from a growing variety of sources; and innovative financial instruments and structures that together help to create new ways for savers and borrowers, investors and entrepreneurs, to meet and do business.
This paper provides examples of a range of important innovations in SME finance and discusses some of the lessons we can draw from them. Although the definition of an SME varies widely across different markets, for the purposes of this report a small enterprise is considered to be a company with 50 or fewer workers and a mediumsized enterprise is any business with 51 to 249 workers. In common with other definitions of SMEs, this excludes companies in extractive industries, utilities and financial services.Get Copy of Report
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THE GROWTH CHALLENGE | UHY Dawgen Chartered Accountants Blog

THE GROWTH CHALLENGE | UHY Dawgen Chartered Accountants Blog:

The research for this report reviewed enterprise policy and institutions in nine countries. Five of these are developed nations: the UK, Germany, France, the US and Singapore; four are emerging: China, India, South Africa and Nigeria. These countries were selected on the basis of their different approaches to enterprise policy, stages of development and size.
The research aimed to establish the critical success factors for policy and infrastructures to support the growth of SMEs. It reviewed the size of the business base, skills and innovation support in each country’s education and training system, access to finance structures, access to mentoring and support networks, and the balance between public and private sector support.
The report demonstrates that the process that takes the entrepreneur out of self-employment and/or ‘necessity entrepreneurship’ and through to sustainable, job-creating and growth-oriented enterprise is vital for both wealth and value creation.
The report shows that policy to support SME growth should not be seen as linear, and nor should policy be seen simply as the regulation of individual entrepreneurial actions. Enterprises, irrespective of their geographical location or stage of development, require different support from the same infrastructures as they grow. The balance of public and private sector funding should change as the returns from any support move from public returns to private returns. Similarly, the fiscal system must work to encourage private sector investment at an early stage, where returns in the long term accrue to the private sector or to the social sector (as in the case with philanthropy). This requires tax incentives to promote and sustain a culture of re-investment.

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Dawkins Brown FCCA,FCA,ACFE, Managing Partner of UHY Dawgen Charetered Accountants
In early 2014, the ACCA/IMA Global Economic Conditions Survey (GECS) marked five full years of coverage of the global economy. Since its launch in early 2009, the survey has received over 40,000 responses from ACCA and IMA members around the world, and its 21 quarterly reports to date have been covered by the financial and mainstream press over 6,300 times. It is ACCA’s most cited publication and a reliable barometer of the global economy.
This report uses GECS data to follow the global recovery through five distinct periods, and uncovers common patterns in the responses of businesses, governments and policymakers around the world, as well as what they have meant for businesses’ finance functions.
The report looks to the future as well as the past. Its findings highlight:
  • The continued importance of global supply chains and regional economic linkages.
  • How both Europe and China have steered clear of the most commonly-cited doomsday scenarios.
  • The fundamental weakness of the early global recovery (2009-10) and how they have been overcome since.
  • The rapid slowdown in China’s economy and its far-reaching consequences for Asia and Africa.
  • The growing disconnect between confidence levels in the financial sector and the real economy, and the fragility of the recent recovery consensus.
  • The decisive role of central banks and the unintended but devastating consequences of their actions on emerging markets.
  • The limitations of fiscal stimulus by ‘big spenders’ such as the US, China, Russia, Malaysia and Pakistan.
  • The persistence of inflation and the threat of new asset bubbles.
  • The return of business financing and investment, and the structural weaknesses it will expose.
Finally, the report gratefully acknowledges the contribution of ACCA and IMA members around the world, who have for five years shared their first-hand accounts of conditions on the ground. Get Copy of Report

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Sunday, July 20, 2014

GraceKennedy buys food chain in the US - Business - Jamaica Gleaner - Sunday | July 20, 2014

GraceKennedy buys food chain in the US - Business - Jamaica Gleaner - Sunday | July 20, 2014:

GraceKennedy Limited has entered into an agreement to purchase the operating assets and business of La Fe Foods Inc for US$26 million.
The transaction is being executed through GK's wholly owned and new subsidiary GraceKennedy Foods (USA) LLC, the conglomerate said Friday.
The deal includes the La Fe brand, which GK describes as "the top Hispanic brand in the frozen food category in northeast USA".
In a release, GK said La Fe Foods, which was established in 1968, currently has revenues of approximately US$80 million and would be the "platform for the growth of GraceKennedy's North American business going forward".
The chain would add approximately $9 billion or 13 per cent more to GK's $67 billion revenue base.
La Fe Foods has operations in Moonachie, New Jersey; Miami, Florida and Raleigh, North Carolina, with brand and distribution presence in the New York/Tri-state area, Florida, Georgia and the US east coast.
Simultaneous with the acquisition, GraceKennedy has also juggled some senior management roles.
Michael Ranglin has been appointed president and CEO of GraceKennedy Foods USA, while retaining his substantive position as CEO of the GK Foods Division. He will be based in New Jersey, GK said.
"Among the advantages are La Fe's manufacturing and distribution capability which can immediately be leveraged. We have also long recognised that the Hispanic food and beverage market is one of the largest growing segments in the food market in the United States," Ranglin commented in the company release.
"We see this as providing a significant opportunity for growth."
Ryan Mack, who was recently appointed Deputy CEO of GK Foods, will now assume oversight for Grace Foods & Services Company and all of GK's manufacturing operations. Andrea Coy, senior general manager in charge of GK's Global Category Management unit, will also have oversight responsibility for the Hi-Lo Supermarket chain and World Brands.
"La Fe was attractive to us for several reasons, including its distribution channels across the East Coast USA and its strong relationships with blue-chip retailers across the US," said GK Group CEO Don Wehby.
"We are very excited about this acquisition, which we anticipate will be a serious game changer for our food distribution network," he said.
Wehby said that the strategic acquisition gives GraceKennedy the ability to own its 'route to market' network in the US, and presents an opportunity to reach out to Hispanic consumers.
GK said that La Fe transaction is the second major acquisition for GraceKennedy outside of Jamaica for its Foods Division with the first being the acquisition of WT Foods (now Grace Foods UK) in the United Kingdom in 2007.
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Saturday, July 19, 2014

Flavors of Jamaica | UHY Dawgen Chartered Accountants Blog

Flavors of Jamaica | UHY Dawgen Chartered Accountants Blog:

Our cuisine is unique and diverse - a melting pot of the many cultures that have shaped Jamaica over the last 500 years – A fusion of Taino, African, Spanish, English, Indian, Chinese, and Middle Eastern cooking traditions have been creolized, creating an authentic, distinctly Jamaican cuisine.
Our food defines us…just like our colourful island dialect – patois and our original music – reggae…
The history of Jamaica can be traced through its food and cooking traditions. In search of fancy
spices and the East Indies, European sailors and merchants crossed the unknown seas. When
Christopher Columbus arrived on the island in 1494, he discovered a wonderful natural, healthy,
unspoilt habitat which he called it Xaymaca, “Land of Wood and Water.” The native Taino Indians who inhabited the low coastal plains, were blessed with bountiful good harvests. They grew cassava, sweet potatoes, maize, tobacco, and fruits such as guava, naseberry and cashew. They were grilling wild pigs on open spits and cooking cassava on large griddles.
English: The Jamaican national dish of ackee a...
English: The Jamaican national dish of ackee and saltfish. Side dish-fabulous cole slaw! Ackee is a fruit, but tastes like scrambled eggs. (Photo credit: Wikipedia)
The Spanish brought plants and animals, and settled the island. They grew oranges, lemons,
plantains, bananas, and most importantly introduced sugar cane and the technology for
small-scale production. Many turned to ranching, and barbecued meats and baked cassava bread to supply crews on passing ships more
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Licences & Permits for Development activities in Jamaica | UHY Dawgen Chartered Accountants Blog

Licences & Permits for Development activities in Jamaica | UHY Dawgen Chartered Accountants Blog:

In order to carry out development activities in Jamaica, a combination of all or any of the following permissions may be required:
  • Required under the Natural Resources Conservation Authority Act
  • Applications submitted to National Environment & Planning Agency (NEPA)
  • Approving entity – Natural Resources Conservation Authority (NRCA)
  • Required under Town & Country Planning Act
  • Applications submitted to the Local Planning Authority in the respective parish councils and the Kingston & St. Andrew Corporation (KSAC)
  • Approving entities – Town and Country Planning Authority and Local Planning Authorities
  • Required under the Local Improvements Act
  • Applications submitted to the Local Authority
  • Approving entities – Local authorities (Parish Councils & KSAC); Recommendation from NEPA
  • These are handled by the respective local authority in each parish under the relevant Building Acts.
UHY Dawgen guides investors through the development approvals process, and works closely with the relevant government ministries and agencies involved to ensure seamless and efficient service delivery.

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