Tax on property income in Honduras

December 12, 2018

INDIVIDUAL TAXATION

Nonresidents are taxed on their Honduran-sourced income. Married couples are taxed jointly.

INCOME TAX

Income earned by nonresidents is generally taxed at a flat rate of 25%. Different tax rates may apply, depending on the classification of income. Income-generating expenses are deductible when calculating taxable income.

Honduras waterfront propertiesRENTAL INCOME
Rental income earned by nonresidents is taxed at a flat rate of 25%. Taxable income is computed by deducting costs incurred and depreciation expense (capital allowance) from the gross income.

CAPITAL GAINS TAX

Capital gains earned by nonresidents from selling real property located in Honduras are taxed at a fixed rate of 10%. The taxable gain is the gross selling price less acquisition costs and improvement costs.


PROPERTY TAX


Real Estate Tax (Impuesto sobre bienes inmuebles)

Real estate tax is levied on all real property in Honduras at progressive rates. The base is the property´s declared value. Real estate tax is levied at 5% for properties located in the Central District.

The tax is levied at progressive rates, from HNL1.50 (US$0.07) to HNL5.00 (US$0.23) per thousand calculated over the property value in urban areas.

Real estate tax is levied at progressive rates, from HNL1.50 (US$0.07) to HNL2.50 (US$0.12) per thousand calculated over the property value in rural areas.

CORPORATE TAXATION

INCOME TAX

Income earned by companies is subject to corporate income tax at a flat rate of 25%. Taxable income is calculated by deducting income-generating expenses from the gross income.

CAPITAL GAINS TAX

Capital gains earned by companies are subject to capital gains tax at a flat rate of 10%. Acquisition costs and improvement costs are deductible when calculating taxable capital gains.