Payroll threshold rose
Jamaica’s income‑tax threshold was increased to J$1,902,360 effective April 1, which will slightly raise some workers’ take‑home pay without changing gross wages. This change is a payroll compliance and communication opportunity for employers who can update payroll settings and explain the effect to staff. (Jamaica Observer)
Jamaica’s income-tax threshold rose on April 1, lifting the amount of annual pay shielded from income tax to J$1,902,360. (jamaicaobserver.com) Tax Administration Jamaica said the change took effect on Tuesday, April 1, 2026, and applies under the pay-as-you-earn system used by employers to deduct tax from wages. Because the increase started three months into the calendar year, the effective tax-free amount for all of 2026 is J$1,876,614, not the full J$1,902,360. (jamaicaobserver.com) The agency said the latest increase will save affected taxpayers J$25,518 a year, or about J$490.73 a week, J$981.46 a fortnight, and J$2,126.50 a month. Gross wages do not change under the measure; the difference shows up in lower income-tax deductions and slightly higher take-home pay. (jamaica-gleaner.com) The move is the second step in a three-year plan announced in the 2025/26 Budget Debate by Finance and the Public Service Minister Fayval Williams. Jamaica Information Service reported in March 2025 that the Government planned to raise the threshold in tranches to J$1.8 million, then J$1.9 million, then J$2 million. (jis.gov.jm) That schedule means the April 2026 increase follows the jump to J$1.8 million on April 1, 2025, and keeps the Government on course for J$2 million in the next phase. The Jamaica Observer reported in March 2025 that pay-as-you-earn workers last got a threshold increase on April 1, 2024, when the ceiling moved to J$1.7 million from J$1.5 million. (jamaicaobserver.com) For payroll departments, the change is mainly a systems job. Tax Administration Jamaica told employers to update payroll settings from April 1 so statutory deductions match the new threshold, echoing the technical guidance it issued when the 2024 threshold increase took effect. (jamaica-gleaner.com) (jis.gov.jm) The threshold is the slice of income that bears no personal income tax, and Jamaica Information Service said income above that line is taxed at 25 percent. In practice, workers earning more than the threshold still pay tax, but only on the portion above it. (jis.gov.jm) The next test is whether employers’ April and May payslips reflect the new settings cleanly. If they do, the policy will reach workers the same way it was designed to: through a small increase in net pay, not a change in salary. (jamaicaobserver.com)
