Solomon Islands Cross-Border Tax Guide: WHT, DTTs, Transfer Pricing 2026

Q: Can I repatriate profits from Solomon Islands tax-free?

Dividends to non-residents: 0% WHT. Interest/royalties: 10-15% and 10% WHT (treaty-reducible). No exchange controls restricting profit repatriation.

Q: What is the procedure for claiming DTT benefits?

Provide the payer with a Treaty Relief Application, Certificate of Tax Residency, and beneficial ownership declaration to apply the treaty rate at source.

Solomon Islands' cross-border tax framework features withholding taxes on outbound payments (dividends 0%, interest 10-15%, royalties 10%), a limited network of Double Taxation Treaties (Australia, New Zealand, UK), and transfer pricing rules. Here is how cross-border taxation works in 2026.

Cross-border taxation in Solomon Islands is governed by domestic tax law and a small number of Double Taxation Treaties. The system is designed to facilitate international trade and investment. Withholding tax rates apply to certain payments from Solomon Islands residents to non-residents. Transfer pricing rules ensure that transactions between related parties are conducted at arm's length. The IRD has designated officers for cross-border tax matters. Investment income tax →

Real-world example: An Australian company receives SBD 500,000 in dividends from its Solomon Islands subsidiary. WHT on dividends is 0% — no tax is withheld. An Australian company licensing software to a Solomon Islands company receives SBD 200,000 in royalties: domestic WHT 10% = SBD 20,000, but under the Australia-SI DTT, the rate may be reduced to 5% = SBD 10,000. A UK bank lending to a SI company receives SBD 100,000 in interest: domestic WHT 15% = SBD 15,000, potentially reduced under the UK-SI DTT. Corporate tax overview →

Withholding Tax Rates

Dividends to non-residents: 0% — no withholding tax on dividends
Interest to non-residents: 10-15% depending on recipient type and loan nature
Royalties to non-residents: 10% WHT
Dividends to residents: 0%
Interest to residents: 0%

WHT applies to payments made by Solomon Islands residents to non-residents. The payer is responsible for withholding and remitting the tax to the IRD. Treaty relief requires the recipient to provide a Certificate of Tax Residency and beneficial ownership declaration.

Double Taxation Treaties

Solomon Islands has a limited DTT network. Treaties generally provide for:

Dividends: 0% domestic, treaty rates typically 0-5% for treaty countries
Interest: Domestic 10-15%, treaty rates typically 5-10%
Royalties: Domestic 10%, treaty rates typically 5-10%
Business profits: Only taxable in the source country if there is a permanent establishment
Employment income: Taxable in the work country (subject to the 183-day exemption for short assignments)

Key treaty partners: Australia, New Zealand, UK, and a small number of others. For treaty partners, reduced rates apply. For non-treaty countries, domestic rates apply. Solomon Islands is exploring expanding its treaty network. Residency and DTTs →

Transfer Pricing

Solomon Islands' transfer pricing rules follow OECD guidelines. Key requirements include:

Arm's length principle: Transactions between related parties must be conducted as if between independent entities
Documentation: Taxpayers should maintain transfer pricing documentation
Methods: Acceptable methods include comparable uncontrolled price (CUP), cost plus, resale price, transactional net margin method (TNMM), and profit split
Penalties: Adjustments and penalties apply for non-compliance

Related parties include parent-subsidiary relationships, sister companies under common control, and individuals with significant influence over a company.

Permanent Establishment Risk

Non-resident companies may create a taxable presence (permanent establishment) in Solomon Islands through: a fixed place of business (office, branch, workshop, construction site exceeding a specific period), a dependent agent with authority to conclude contracts, or provision of services through employees for more than 183 days in any 12-month period. A PE is subject to CIT at 30% on profits attributable to the PE. There are no exchange controls in Solomon Islands, so funds can be freely repatriated.

Can I repatriate profits from Solomon Islands tax-free?

Dividends paid to non-resident shareholders attract 0% WHT. Interest and royalties paid to non-residents attract 10-15% and 10% WHT respectively (subject to treaty reduction). There are no exchange controls restricting repatriation of profits.

What is the procedure for claiming DTT benefits?

The non-resident must provide the Solomon Islands payer with: a completed treaty relief application form, a Certificate of Tax Residency from the home country tax authority, and a declaration of beneficial ownership. The payer then applies the treaty rate at source.