Effective January 1, 2026, the Income Tax (Amendment) Act No. 3 of 2026 amends the personal income tax allowance and increases the chargeable income ceiling for employed and self-employed individuals.
Hereunder are the key updates:
CHARGEABLE INCOME
Section 20 (a) of the Income Tax Act, Chapter 81:01 has been amended to increase the annual Personal Deduction to one million, six hundred and eighty thousand dollars ($1,680,000), or 1/3 of an individual’s income from all sources excluding income subject to withholding taxes under section 39 (1) per annum, whichever is greater.
Section 36 of the Income Tax Act, Chapter 81:01 has been amended to increase the chargeable income from three million one hundred and twenty thousand dollars ($3,120,000) to three million three hundred and sixty thousand dollars ($3,360,000) annually, taxable at the rate of twenty-five percent (25%).
Section 36A of the Income Tax Act, Chapter 81:01 has been amended to allow for chargeable income in excess of three million three hundred and sixty thousand dollars ($3,360,000) annually to be subjected to tax at the rate of thirty-five percent (35%).
INCOME FROM ALL SOURCES FOR AGED AND INCAPACITATED PERSONS
The threshold for aged and incapacitated persons to benefit from an exemption from taxes on interest earned on savings accounts, as stipulated in Section 8 of the Income Tax Act, Chapter 81:01, has been increased. The new threshold is one million, six hundred and eighty thousand dollars ($1,680,000) of an individual’s income from all sources, including income subject to withholding taxes under section 39(1), per annum.
FILING OF RETURNS
Section 60(1) (a) of the Income Tax Act, Chapter 81:01 has been amended to allow for income tax returns to be filed with the Commissioner-General where the Income is not less than one million, six hundred and eighty thousand dollars ($1,680,000).
DEDUCTION FOR EMPLOYED PERSONS:
- Monthly Personal Allowance (Free Pay) Deduction: one hundred and forty thousand dollars ($140,000), or one-third (1/3) of Balance of Income after allowing for Second Job and Overtime statutory allowance, whichever is greater.
- National Insurance Scheme (NIS) Contribution Deduction: a ceiling of fifteen thousand six hundred and eighty dollars ($15,680) monthly or 5.6% of gross income up to two hundred and eighty thousand ($280,000) monthly.
- Medical and Life Insurance Premium Deductions: a ceiling of the amount of the premiums paid by the employee, ten percent (10%) of gross salary or fifty thousand dollars ($50,000) monthly, whichever is less.
- Child Deduction: ten thousand dollars ($10,000) monthly for each child under the age of 18 years old.
- Second Job Deduction: first fifty thousand monthly ($50,000).
- Overtime Deduction: first fifty thousand monthly ($50,000).
SELF-EMPLOYED INDIVIDUALS:
- Personal allowance (Free Pay): of one million, six hundred and eighty thousand dollars ($1,680,000) annually, Balance of Income/Profit, or one-third (1/3) of Balance of Income/Profit, whichever is greater
- Child allowance (if applicable): one hundred and twenty thousand dollars annually ($120,000) for each child under the age of 18 years old.
- Medical and Life Insurance Premium Deductions:Applicable on the amount of premiums paid for medical and life insurance, ten percent (10%) of gross income or six hundred thousand dollars ($600,000) annually, whichever is less.
REMINDER TO EMPLOYEES, EMPLOYERS AND SELF-EMPLOYED INDIVIDUALS;
- For employees making claims for child allowance, a Child Deduction Claim Form must be filled out and submitted with the applicable supporting documentation to their Employers.
- Employees with a Second Job, must present their Second Employer with the information of their full-time employment to allow their second employer to make the deduction of $50,000 monthly from their “second job” salary.
- Self-employed individuals should be aware that medical and life insurance premiums must be deducted after calculating the net income, which is determined by subtracting expenses and other allowances. These premiums should not be included as an expense when calculating the chargeable income.
- Where employers pay medical and life insurance premiums as a benefit to the employee and it is included in the employee’s salary (benefit in kind), then the employee will be allowed the medical and/or life insurance premium as a deduction.
- Employees who have private medical and life insurance must obtain a statement from their approved insurance company showing the premiums paid. This statement should be submitted by April 30, 2027, along with their Statement of Earnings or 7B Form when filing their Income Tax Return. This will allow them to benefit from the deduction.
- Self-employed individuals with private medical and life insurance must obtain a statement from their approved insurance company showing the premiums paid. This statement should be submitted by April 30, 2027, along with their Financial Statements when filing their Income Tax Return. This will enable them to benefit from the deduction.
- Commencing March 2026, employers will be required to adjust their employees’ tax payable using the schedule below. Employers should use the revised personal allowance to recalculate the employees’ tax payable and refund any over-deducted tax until the employee is fully reimbursed.
- The schedule below must accompany the PAYE RETURN (Form 5) for the month of March 2026 to reflect taxes over-deducted. (Please check GRA’s Website for the new electronic form: https://www.gra.gov.gy/forms/ )
- In cases where the refund amount exceeds the monthly tax, the remaining balance will be carried forward to the next month or until it is fully refunded to the employee.
- Employers are legally required to issue their employees’ statements of their earnings for the employed period on the 7B FORM.
- It is mandatory for all employers to promptly implement the new Income Tax Thresholds and deductions.
| No. | Name of Employee | Actual Tax Deducted for the Month of March | Over-Deductions
(January – February) |
Amount to be Remitted as PAYE |
| 1 | John Brown | $10,000 | $6,000 | $4,000 |
(COMPUTATIONS)
The General Threshold and Deductions for all Individuals are as follows:
| Particulars
|
Personal Deduction (Free Pay) |
National Insurance Scheme
|
Medical and Life Insurance Premiums Deduction | Child Deduction under 18 years old ) |
Second Job Deduction | Overtime Deduction | Rate of Tax 25% on Chargeable Income ≤ $3,360,000 |
Rate of Tax 35% on Balance of Chargeable Income > $3,360,000 |
Salary/Net: Profit/Income Base per period: |
| Daily | $4,603 | 5.6% of Gross Salary | $9,205 | Balance @ 35% | $13,808 | ||||
| Weekly | $32,308 | 5.6% of Gross Salary | $64,615 | Balance @ 35% | $96,923 | ||||
| Fortnightly | $64,615 | 5.6% of Gross Salary | $129,231 | Balance @ 35% | $193,846 | ||||
| Monthly | $140,000 | 5.6% of Gross Salary of $280,000 monthly | 10% of Gross Salary; premiums paid or $50,000 monthly whichever is less) | $10,000 monthly per child | ≥$50,000 monthly | ≥$50,000 monthly | $280,000 | Balance @ 35% | $420,000 |
| Yearly | $1,680,000 | 5.6% of Gross Salary of $3,360,000 annually | 10% of Gross Salary; premiums paid or $600,000y annually whichever is less) | $120,000 monthly per child | ≥$600,000 monthly | ≥$600,000 monthly | $3,360,000 | Balance @ 35% | $5,040,000 |
- The Threshold and Deductions for Employed Individuals are as follows:
Weekly Income Tax Computation for Employed Individuals with only One (1) Job
| A | B | C | D | E | F | G | H |
Yearly Gross Inclusive of all Taxable Allowance |
Personal Allowance |
NIS Deduction (A * 5.6%) |
Total Personal Deduction (B + C) |
Chargeable Income (A – D) |
Tax @ 25% (E * 25%) |
Tax @ 35% |
Total Tax Payable (F + G) |
| ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| $14,892 * 25% | |||||||
| 50,000 | 32,308 | 2,800 | 35,108 | 14,892 | 3,723 | – | 3,723 |
| Fortnightly Income Tax Computation for Employed Individuals with only One (1) Job | |||||||
| A | B | C | D | E | F | G | H |
Yearly Gross Inclusive of all Taxable Allowance |
Personal Allowance |
NIS Deduction (A * 5.6% not exceeding $7,237) |
Total Personal Deduction (B + C) |
Chargeable Income (A – D) |
Tax @ 25% (E * 25%) |
Tax @ 35% |
Total Tax Payable (F + G) |
| ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| 130,000 | 64,615 | 7,237 | 71,852 | 58,148 | 14,537 | – | 14,537 |
| A * 1/3 | NIS Ceiling (129,231 * 5.6%) | (126,096 * 25%) | |||||
| 200,000 | $ 66,667 | $ 7,237 | $ 73,904 | $ 126,096 | $ 31,524 | – | $ 31,524 |
| Monthly Income Tax Computation for Employed Individuals with only One (1) Job | |||||||
| A | B | C | D | E | F | G | H |
Yearly Gross Inclusive of all Taxable Allowance |
Personal Allowance |
NIS Deduction (A * 5.6%) |
Total Personal Deduction (B + C) |
Chargeable Income (A – D) |
Tax @ 25% (E * 25%) |
Tax @ 35% |
Total Tax Payable (F + G) |
| ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| 150,000 | 140,000 | 8,400 | 148,400 | $1,600 | 400 | – | 400 |
| A * 1/3 | NIS Ceiling (280,000 * 5.6%) | $280,000 * 25% | (E – $280,000) * 35% | ||||
| 420,000 | 140,000 | 15,680 | 155,680 | 264,320 | 66,080 | – | 66,080 |
| Yearly Income Tax Computation for Employed Individuals with only One (1) Job | |||||||
| A | B | C | D | E | F | G | H |
Yearly Gross Inclusive of all Taxable Allowance |
Personal Allowance |
NIS Deduction (A * 5.6%) |
Total Personal Deduction (B + C) |
Chargeable Income (A – D) |
Tax @ 25% (E * 25%) |
Tax @ 35% |
Total Tax Payable (F + G) |
| ($) | ($) | ($) | ($) | ($) | ($) | ($) | ($) |
| 2,500,000 | 1,680,000 | 140,000 | 1,820,000 | 680,000 | 170,000 | – | 170,000 |
| A * 1/3 | NIS Ceiling (3,360,000 * 5.6%) | 3,360,000 * 25% | (E – 3,360,000) * 35% | ||||
| 5,600,000 | 1,866,667 | 188,160 | 2,054,827 | 3,545,173 | 840,000 | 64,811 | 904,811 |
By Order of
Mr. Godfrey Statia
Commissioner General,
Guyana Revenue Authority
