Understanding BVI Payroll Calculations – Employee

There are three statutory deductions each pay period

    1. National Health Insurance 3.75% *
    2. Social Security 4%
    3. Inland Revenue Tax 8% (Only if the employee have made more than $10,000 for the year)

*If an employee’s spouse is not employed, the employee has to pay an additional 3.75% to the National Health Insurance board. 

Scenario A

Let’s imagine that this pay period, the employee made $1000 and their Year-To-Date (Total earnings for the year)  is $7000 

$1000 – [$40 (Social Security) + $37.50 (National Health Insurance)] = $922.50 (Net Pay)

Scenario B

Let’s imagine that this pay period the employee made  $1000 and their YTD is $15,000

$1000 – [$40 (Social Security) + $37.50 (National Health Insurance) + $80 (Inland Revenue Tax)] = $842.50 (Net Pay)

*Payroll tax is included because the employee has already made more than $10,000 for the year. 

That’s it!   There are some exceptions but most employees will be paid using Scenario A or B.   Try our free payroll calculator at https://vihrms.com/bvi-payroll-calculator/   

The Employer also has to pay taxes and we will address employer taxes in a next article. 

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