New income tax threshold in effect, employers reminded to make adjustment

Tax Administration Jamaica (TAJ) is reminding taxpayers and employers to adjust their financial planning and payroll systems to accommodate this month's increase of the income tax threshold to $1,902,360, up from $1,799,376.

The latest increase in the income tax threshold will result in savings to individuals of $25,518 annually, or about $490.73 weekly, $981.46 fortnightly and $2,126.50 monthly.

This adjustment is in keeping with the announcement made by the Minister of Finance and the Public Service, Fayval Williams, during the 2025 Budget Presentation. At that time, it was outlined that the annual Income Tax threshold would be progressively increased over the period 2025 through 2028, with a target of $2,000,000.

As the new threshold took effect on April 1, 2026, the effective tax-free amount for the full twelve months of 2026 is $1,876,614.

This represents the second phase of the planned increases and results in higher periodic tax-free amounts for both employed and self-employed individuals, as follows:

• Weekly: $36,583.85 (previously $34,603)

• Fortnightly: $73,234.90 (previously $69,307.26)

• Monthly: $158,530 (previously $149,948)

Tax Administration Jamaica is also reminding pensioners and golden agers (persons aged 65 and over) that they are entitled to additional exemptions of $250,040 for each category. Accordingly, an individual who receives a pension from an approved pension scheme and is also 65 years or older will benefit from a combined tax-free income of $2,376,654 in 2026 before any income tax becomes applicable.

For additional information, taxpayers may contact the TAJ Customer Care Centre at 888-TAX-HELP (888-829-4357) or visit www.jamaicatax.gov.jm to access the related Technical Advisory on Income Tax Threshold.

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