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Hiring in Fiji
Fiji, officially known as the Republic of Fiji, is an Island Country in the South Pacific Ocean. Suva is the capital and the largest city of Fiji. Fiji is a highly developed country, whereby it is rich in natural resources such as fish, gold, timber, offshore oil and copper. Service sector, especially tourism, is a major sector of Fiji. Fiji’s main trading partners are the United States, United Kingdom, Singapore and Japan. Global PEO or Employer of Record (EOR) play a pivotal role in providing companies with services related to hiring employees, and ensuring compliance with Fiji’s legal and tax regulations. The Labor Code stipulates that employees are entitled to 10 working days of paid annual leave. Residents are taxed on worldwide income. Non-residents are taxed on Fiji source income only. Global PEO’s or Employer of Record (EOR) facilitate companies by ensuring compliance with Fiji’s Labor Code and tax laws.
statutory labor requirements
Probation Period
- The Employment Relations Law does not cover the probationary period of employment.
- A probationary period is at the discretion of the employer to assess the performance of a worker under a contract of service
Annual Leave
- After each year of employment with an employer, an employee shall be given 10 working days’ holiday paid at the normal wages she/he would have received during that period.
Public Holidays
- New Year's Day (1st January)
- Good Friday (10th April)
- Holy Saturday (11th April)
- Easter Monday (13th April)
- Constitution Day (7th September)
- Fiji Day (10th October)
- Prophet's Birthday
- Diwali (16th November)
- Christmas Day (25th December)
- Boxing Day (26th December)
Maternity Leave
- The entitlement to maternity leave pay is 84 days.
- A woman will not be entitled to wages in respect of any days taken in excess of 84 days.
Paternity Leave
- A male worker will be entitled to 5 days' paid paternity leave
Sick Leave
- Generally, the minimum entitlement is 10 days during any year of service (except casual and piece-rate workers).
- Sick leave is not generally payable if the employee has served less than 3 months.
Work Hours
- An employment contract must fix at not more than 45 or 48 the maximum number of hours (exclusive of overtime) to be worked in a week by a worker bound by that contract.
Overtime
- The rate of remuneration payable for overtime work to a worker shall be:
- one and half time the worker’s normal hourly rate of remuneration in respect of first four hours worked in excess of normal working hours and twice the worker’s normal rate of remuneration for all times worked thereafter;
- twice the worker’s normal rate of remuneration in respect of all time worked on a rostered day-off;
- one and half times the worker’s normal hourly rate of remuneration in respect of all time worked on a public holiday;
- for workers’ engaged on five day working week at one and half times the normal rate of remuneration for the first four hours worked on Saturday and thereafter including Sunday at twice the workers’ normal rate of remuneration.
Notice Period
- Notice periods are as follows: -
-
- where the contract period is less than one week and wages are paid at intervals of less than one week, there is no notice period
- where the contract period is one week or more but less than a fortnight or where wages are paid weekly or at intervals of more than a week but less than a fortnight, notice period of 7 days seven days
- where the contract period is a fortnight or more but less than a month or where wages are paid fortnightly or at intervals of more than a fortnight but less than a month, the notice period is of 14 days
- where the contract period is one month, the notice period is of one month
Severance
- In Fiji the amount of the redundancy payment is 1 week's salary per year worked.
13th / 14th Month Pay
- No
- There is no statutory requirement to pay the 13th or 14th month salary.
- Employees are entitled to 10 working days holiday, paid at the normal rate as if they were working.
- There is no mention of bonuses paid.
income tax
- Resident individuals are liable to tax on taxable income accruing in or derived from Fiji or elsewhere.
- Non-residents are liable to tax only on taxable income accruing in or derived from Fiji.
- Pensions received by non-resident pensioners from a Fiji source will not be taxed.
- When a non-Fiji citizen is in Fiji mainly for employment purposes under a contract of employment of not more than three years, income other than employment income is not subject to tax in Fiji if it is not derived from or does not accrue in Fiji.
- Income tax is assessed on taxable (chargeable) income.
- Where the taxable income of a resident exceeds FJD 50,000, income tax is FJD 3,600 plus 20% in excess of FJD 50,000. In the case of non-residents, income tax is 20% of the taxable income.
- In addition to income tax, social responsibility tax (SRT) and environment and climate adaptation levy (ECAL) are imposed on chargeable income.
|
Resident individuals |
||||
|
Chargeable income (FJD) |
Income tax payable |
SRT payable |
ECAL payable |
|
|
From |
To |
|||
|
0 |
30,000 |
0 |
0 |
0 |
|
30,000 |
50,000 |
18% assessed on amounts over FJD 30,000 |
0 |
0 |
|
50,000 |
270,000 |
FJD 3,600 plus 20% assessed on amounts over FJD 50,000 |
0 |
0 |
|
270,000 |
300,000 |
FJD 47,600 plus 20% assessed on amounts over FJD 270,000 |
13% assessed on amounts over FJD 270,000 |
10% assessed on amounts over FJD 270,000 |
|
300,000 |
350,000 |
FJD 53,600 plus 20% assessed on amounts over FJD 300,000 |
FJD 3,900 plus 14% assessed on amounts over FJD 300,000 |
10% assessed on amounts over FJD 270,000 |
|
350,000 |
400,000 |
FJD 63,600 plus 20% assessed on amounts over FJD 350,000 |
FJD 10,900 plus 15% assessed on amounts over FJD 350,000 |
10% assessed on amounts over FJD 270,000 |
|
400,000 |
450,000 |
FJD 73,600 plus 20% assessed on amounts over FJD 400,000 |
FJD 18,400 plus 16% assessed on amounts over FJD 400,000 |
10% assessed on amounts over FJD 270,000 |
|
450,000 |
500,000 |
FJD 83,600 plus 20% assessed on amounts over FJD 450,000 |
FJD 26,400 plus 17% assessed on amounts over FJD 450,000 |
10% assessed on amounts over FJD 270,000 |
|
500,000 |
1,000,000 |
FJD 93,600 plus 20% assessed on amounts over FJD 500,000 |
FJD 34,900 plus 18% assessed on amounts over FJD 500,000 |
10% assessed on amounts over FJD 270,000 |
|
1,000,000 |
and above |
FJD 193,600 plus 20% assessed on amounts over FJD 1,000,000 |
FJD 124,900 plus 19% assessed on amounts over FJD 1,000,000 |
10% assessed on amounts over FJD 270,000 |
|
Non-Resident individuals |
||||
|
Chargeable income (FJD) |
Income tax payable |
SRT payable |
ECAL payable |
|
|
From |
To |
|||
|
0 |
270,000 |
20% of chargeable income |
0 |
0 |
|
270,000 |
300,000 |
20% of chargeable income |
13% assessed on amounts over FJD 270,000 |
10% assessed on amounts over FJD 270,000 |
|
300,000 |
350,000 |
20% of chargeable income |
FJD 3,900 plus 14% assessed on amounts over FJD 300,000 |
10% assessed on amounts over FJD 270,000 |
|
350,000 |
400,000 |
20% of chargeable income |
FJD 10,900 plus 15% assessed on amounts over FJD 350,000 |
10% assessed on amounts over FJD 270,000 |
|
400,000 |
450,000 |
20% of chargeable income |
FJD 18,400 plus 16% assessed on amounts over FJD 400,000 |
10% assessed on amounts over FJD 270,000 |
|
450,000 |
500,000 |
20% of chargeable income |
FJD 26,400 plus 17% assessed on amounts over FJD 450,000 |
10% assessed on amounts over FJD 270,000 |
|
500,000 |
1,000,000 |
20% of chargeable income |
FJD 34,900 plus 18% assessed on amounts over FJD 500,000 |
10% assessed on amounts over FJD 270,000 |
|
1,000,000 |
and above |
20% of chargeable income |
FJD 124,900 plus 19% assessed on amounts over FJD 1,000,000 |
10% assessed on amounts over FJD 270,000 |
deductible expenses
Personal Deductions
- The deduction threshold for contributions to approved academic and charitable organizations is FJD 100,000.
- There are certain other specific donations that qualify for varying levels of deductions, including:
-
- Donations to the Fiji Heritage Foundation, which qualify for a deduction of 150%.
- Cash donations exceeding FJD 50,000 to the Poverty Relief Fund for Education, which qualify for a deduction of 200%.
- Cash donations exceeding FJD 50,000 (FJD 15,000 effective 1 January 2020) to a Sports Fund (as approved by the CEO of the Fiji Revenue and Customs Service [FRCS]) for purposes of sports development in Fiji, which qualify for a deduction of 150%.
- Total cost of new computers, laptops, and tablets of not less than FJD 10,000 but not exceeding FJD 100,000 donated to urban and rural schools registered with the Ministry of Education, which qualify for a deduction of 150% and 200%, respectively.
- Cash donations of not less than FJD 10,000 but not exceeding FJD 100,000 to the Disaster Rehabilitation Fund, which qualify for a deduction of 150%.
- Cash donations not exceeding FJD 50,000 towards any approved housing project for squatters by the Fiji government, which qualify for a deduction of 150%.
- Cash donations of not less than FJD 10,000 to the Farmers Disaster Relief Emergency Fund Account, which qualify for a deduction of 200%.
- Effective 1 April 2020, a person is also allowed a deduction for 300% of the amount of a cash donation made in a tax year to a fund established by the Government to respond to the COVID-19 pandemic.
Business Deductions
- In calculating taxable income, deductions may be allowed for revenue expenditure wholly and exclusively incurred for the purposes of deriving that income.
- Deductions are generally not available for capital expenditure, personal or living expenses, or for income taxes paid.
- As part of the COVID-19 response and effective from 1 April 2020, if a person has a net business loss, the person’s employment income is reduced by the net business loss in computing the chargeable income provided that the amount reduced does not exceed $20,000.
- Furthermore, a landlord that reduces the commercial rent payable under a tenancy agreement is allowed a deduction for the aggregate sum of the difference between the rent payable on 26 March 2020 and the rent payable in the period commencing on and from 27 March 2020 to 31 December 2020 subject to certain conditions.
|
Deductible Expenses |
|
|
Personal Deductions |
|
|
Business Deductions |
|
immigration
- A visitor’s visa, which is usually issued for one month but may be extended to six months, is normally granted to tourists or to individuals wishing to investigate business opportunities in Fiji.
- Foreign nationals from most developed countries may obtain visitors’ visas at the port of entry if they have valid passports, return or onward tickets, and sufficient funds for living expenses.
- All other persons must obtain visas before entering Fiji.
- The right to work in Fiji is restricted, but the Fiji government recognizes the need to admit individuals with special commercial, professional or technical skills to improve Fiji’s economic development.
- Therefore, permits to reside and work in Fiji are granted to foreign investors and expatriate employees under qualifying circumstances.
- Permits to reside and work in Fiji are granted to fill positions that cannot be filled adequately by local Fiji citizens.
- Permits are usually granted for an initial period of three years and are renewable only if the continued presence of the permit holder is considered to be to Fiji’s economic advantage and essential to the employer’s operations.
- Foreign nationals with investment in approved business ventures in Fiji are granted permits that allow them to increase and manage their investments.
- These permits are usually valid for a three-year period, and extensions are virtually assured as long as the capital remains invested in Fiji.
- Foreign investors, regardless of nationality, wanting to establish a business in Fiji must have the prior approval of Investment Fiji (IF).
- To obtain this approval, a separate application describing all pertinent information relating to the proposed project must be filed with IF.
|
Type of Visa/Permit |
Documentation |
Validity |
Eligibility |
|
Visitor’s Visa |
|
1 month (can be extended to 6 months) |
|
|
Work Permit |
|
3 years (renewable) |
|
value added tax
- VAT of 9% is generally levied on the supply of goods and services in Fiji.
|
VAT |
|
|
Standard Rate |
9% |
withholding tax
WHTs are levied as follows:
|
Recipient |
WHT (%) |
||||
|
Dividends |
Interest |
Royalties |
Know-how, management fees |
Professional fees |
|
|
Resident corporations |
0 |
10 |
5 |
5 |
5 |
|
Resident individuals |
0 |
10 |
5 |
5 |
5 |
|
Non-resident corporations |
0 |
10 |
15 |
15 |
15 |
termination
According to the labor code, an employer shall not dismiss an employee summarily except in the following circumstances:
-
- where an employee is guilty of misconduct inconsistent with the fulfillment of the express or implied conditions of the contract of service;
- for willful disobedience to lawful orders given by the employer;
- for lack of the skill which the employee is meant to possess;
- for habitual or substantial neglect of duties; and
- for continual absence from work without the permission of the employer and without other reasonable excuse.
- Notice periods are as follows: -
-
- where the contract period is less than one week and wages are paid at intervals of less than one week, there is no notice period
- where the contract period is one week or more but less than a fortnight or where wages are paid weekly or at intervals of more than a week but less than a fortnight, notice period of 7 days seven days
- where the contract period is a fortnight or more but less than a month or where wages are paid fortnightly or at intervals of more than a fortnight but less than a month, the notice period is of 14 days
- where the contract period is one month, the notice period is of one month
- In Fiji the amount of the redundancy payment is 1 week's salary per year worked.
statutory benefits
- These are mandatory benefits as postulated by law
- These include probationary period, annual leave, public holidays, sick leave, maternity leave, paternity leave, overtime pay, notice period, and severance pay
- Statutory benefits also include social security benefits
|
Statutory Benefits |
|
Probationary Period |
|
Annual Leave |
|
Public Holidays |
|
Maternity Leave |
|
Paternity Leave |
|
Sick Leave |
|
Overtime Pay |
|
Notice Period |
|
Severance Pay |
|
Social Security Benefits |
payments and invoicing
- The taxable year for the individual is the calendar year.
- Personal income tax returns for the immediately preceding year must be lodged by 31 March each year.
- However, under the Tax Agent Lodgment Programme, an extension of time may be granted to lodge the income tax returns.
- Effective 1 April 2020, any penalty payable in respect of any failure by a taxpayer to file a tax return by the due date is deemed to have been waived if the due date falls on a date within the amnesty period i.e., the period commencing on and from 31 March 2020 to 31 December 2020.
- Employees are no longer required to lodge income tax returns in certain cases (e.g. employee has only one employer during the year and appropriate PAYE taxes have been deducted).
- There is income tax withholding from salaries (i.e. PAYE final withholding tax). PAYE final withholding tax shall be a final tax for certain employees.
- Generally, if taxpayers have sizable income not subject to PAYE final withholding tax, they will be required to make provisional payments of estimated tax in three instalments.
- Advance tax payments for the 2020 tax year are due in nine equal instalments which are due at the end of each month from April to December 2020.
ease of doing business
- The ease of doing business index is an index created by Simeon Djankov, an economist at the Central and Eastern Europe sector of the World Bank Group.
- Higher rankings (a low numerical value) indicate better, usually simpler, regulations for businesses and stronger protections of property rights.
- According to the World Bank Fiji ranked 102nd in the World in 2019 in terms of ease of doing business.
employee accruals
| Christmas Bonus% |
0% |
| Christmas Bonus Over Vacations % |
0% |
| Severance per Year % |
Employees are entitled to severance pay that equals 5/6th of their monthly salary after one year of service (6.91% of annual salary) |
| Vacations % | Employees are entitled to 10 days of paid annual leave (2.74% of annual salary) |
| Notice % |
Employees are entitled to 30 days of notice period for one year of service or more (8.24%) |
| Christmas Bonus Over Notifications% | 0% |
| Vacations Plus% | 0% |
| Total percentage of Salary (yearly) | The total employment accruals as a percentage of salary per anum are equal to 17.98% |
employer accruals
Additional information (Country Accruals)
| FNPF | 5.00% |
| Descritption: | All employers and employees must contribute an amount equal to at least 10% and 8%, respectively, of the gross cash earnings of all employees to the FNPF. Effective 1 April 2020, the FNPF employer and employee contributions have been reduced to 5% respectively as part of the government’s COVID-19 response. Foreign employees are not required to contribute to the FNPF. However, employers have the option to include foreign employees by informing the FNPF in writing of both their and the employees intention to register with the FNPF. |
Employer Accruals Additional information
| Employment Accruals | ||
| Annual Leave | After each year of employment with an employer, an employee shall be given 10 working days’ holiday paid at the normal wages she/he would have received during that period. | This equals 2.74% (10/365 days) of annual income |
| Maternity Leave | The entitlement to maternity leave pay is 84 days. | This equals 23% (84/365 days) of annaul income |
| Paternity Leave | A male worker will be entitled to 5 days' paid paternity leave | This equals 1.36% (5/365 days) of annual income |
| Sick Leave | Generally, the minimum entitlement is 10 days during any year of service (except casual and piece-rate workers). | This equals 2.74% (10/365 days) of annual income |
| Overtime | The rate of remuneration payable for overtime work to a worker shall be: • one and half time the worker’s normal hourly rate of remuneration in respect of first four hours worked in excess of normal working hours and twice the worker’s normal rate of remuneration for all times worked thereafter |
Depends on the number of overtime hours worked |
| Severance | In Fiji the amount of the redundancy payment is 1 week's salary per year worked. | This equals 1.92% (1/52 weeks) of annual income |
| Social Security | Employers must contribute 5% to the Fiji National Provident Fund (FNPF) | This equals 5% of annual income |
