How to Register a Sole Proprietorship (Sole Trader) in Trinidad and Tobago

In Trinidad and Tobago, many freelancers and small business owners choose to operate as sole proprietors because the structure is straightforward, cost-effective, and provides full control over the business. Establishing a sole proprietorship typically requires fewer formalities than setting up a company, which makes it a practical entry point for individuals starting on their own.

The process, however, still involves important steps such as registering the business name, obtaining a tax identification number, and complying with tax and record-keeping requirements. Key challenges include navigating different government systems, staying compliant with VAT thresholds, and managing the risks that come with unlimited personal liability.

Even so, this structure offers significant benefits for those who value independence, streamlined administration, and flexibility in running their operations.

Disclaimer: This article is for informational purposes only and is not a substitute for legal or tax advice. Always consult official sources or a professional before taking action.

What is a sole proprietorship in Trinidad and Tobago?

In Trinidad and Tobago, the equivalent of a sole proprietorship is generally referred to simply as a sole trader or self-employed individual. There is no special local term beyond “sole trader” or “sole proprietor.”

Depending on the context, you may also see the terms:

• Self-employed
• Individual entrepreneur
• Proprietor

All refer to a business model in which a single person legally owns and operates the business without forming a separate company.

How does a sole proprietorship (sole trader) work in Trinidad and Tobago?

Sole trader vs. other structures in Trinidad and Tobago

There are alternatives to registering as a sole proprietor in Trinidad and Tobago. Some entrepreneurs choose to incorporate a limited company or form a partnership instead. Each option has different implications for liability, tax treatment, and scalability. Below is a comparison between the sole trader structure and these alternatives.

Step-by-step guide: How to register a sole proprietorship in Trinidad and Tobago

Step 1: Check your eligibility

Anyone who is resident or legally allowed to work in Trinidad and Tobago may become self-employed. Foreign nationals can also set up if they hold the proper legal status (e.g., work permit, residence permit). The registration process itself does not generally restrict by citizenship, but you may need to satisfy identification and address requirements.

Step 2: Choose your business name

You may use your own name or a trading name. If you choose a trading name, you must ensure it is not identical to or too similar to existing registered business names. You will perform a name search and then reserve that name via the Registrar General’s Department. The name reservation fee is $20.

The name reservation process is handled through TTBizLink or through the Companies Registry via its online filing tools.

Step 3: Gather required documents

You will typically need:

• Valid identification (national ID, passport, or driver’s licence)
• Proof of address (utility bill, lease agreement, etc.)
• Your proposed business name (after reservation)
• Completed registration form (Application for Registration of Business Name)
• Declaration or consent forms as needed
• Sometimes, a photograph or selfie with ID for verification

The Companies Registry registration page provides instructions on required supporting documents and how to submit them.

Step 4: Register with the Registrar (Companies Registry)

You must file an Application for Registration by an Individual (Business Name Registration) with the Companies Registry of the Registrar General’s Department. You may register via TTBizLink (the government’s business portal), which facilitates online registration and tracking.

After filing, if approved, you will receive your Certificate of Registration, typically within 3–5 working days.

Step 5: Pay registration fees and contributions

Once your application is approved, you will be required to pay the government fees. The cost to reserve a business name is $20, and the cost to register the business is $220. Payments can be made online via TTBizLink or in person at the Registry office. There are no formal capital contributions required for a sole proprietorship, but you will be responsible for meeting your future tax obligations. Depending on your type of business, you may also need to pay for separate sector-specific licenses or permits.

Step 6: Complete post-registration obligations

After registering, you must complete several compliance steps. These include registering for a BIR file number with the Inland Revenue Division to ensure you can file taxes, and enrolling in e-Tax to submit returns electronically. If you hire employees, you must register for PAYE and the Health Surcharge system, and remit deductions monthly. Additionally, you are required to keep detailed records of your income and expenses in English and retain them at your residence or business address in Trinidad and Tobago for audit purposes.

Financial and tax obligations for sole proprietors in Trinidad and Tobago

You are responsible for:

• Income tax: Business profits are taxed as personal income. Current rates are 0% for the first $84,000, 25% for taxable income up to $1,000,000, and 30% on income above that. You must file an annual income tax return via the Inland Revenue Division’s e-Tax system. Quarterly instalment payments may apply if your business profits are significant.
• VAT: The standard VAT rate is 12.5%. Registration is mandatory if your annual turnover exceeds $600,000. VAT returns are filed every two months.
• PAYE and Health Surcharge (if you hire employees): You must withhold PAYE tax from employee wages and remit it monthly. In addition, you are required to deduct and remit the Health Surcharge for all employees (except those under 16, those 60 or over, or those whose only income is a pension). The Health Surcharge is TT$4.80 per week for employees earning up to TT$469.99 per month (or TT$109 per week) and TT$8.25 per week for those earning above that threshold
• Record-keeping: You must maintain complete records of sales, purchases, expenses, and wages in English and in TT dollars. These must be retained at your business or residence and made available if requested during an audit.
• Invoicing: All invoices must include your registration details, business name, client details, date, description of goods or services, and VAT (if applicable). Invoices must be numbered sequentially and retained in your records.

Launch your contracting career and stay compliant with Deel

Registering as a sole proprietor gives you independence, but it also means handling taxes, invoices, and records on your own. Deel’s all-in-one platform helps you manage obligations without the stress. With Deel, you can:

• Automate invoicing and expense tracking with essential Bookkeeping tools
• Create, send, and sign localised work agreements
• Keep accurate records for tax season
• Access expert tax advice and compliance support
• Get paid through multiple payment and withdrawal methods
• Spend your earnings in USD with the Deel Card
• Access funds early with Deel Advance
• Enjoy contractor perks from 150+ partners

Stay independent, without the admin overload. Sign up to Deel for free today.

FAQs

What is the minimum capital required to start a sole trader in Trinidad and Tobago?
There is no minimum capital requirement. You can begin operations with minimal funds.

Do sole traders need to register for VAT?
Yes, but only if their annual turnover exceeds TT$600,000 within a 12-month period.

How much are the registration fees?
The fees are TT$20 for name reservation and TT$220 for the certificate of registration.

Can a sole trader hire employees?
Yes. Sole traders may hire employees but must register for PAYE and Health Surcharge, withhold taxes, and remit them monthly to the Inland Revenue Division.

How long does it take to register as a sole trader?
The process typically takes 3–5 working days once documents are submitted and approved.

Can foreign nationals register as sole traders in Trinidad and Tobago?
Yes, provided they have the right to work or reside in the country. They must also meet identification, address, and permit requirements.

Do sole traders need a separate business bank account?
It is not mandatory, but highly recommended for clear accounting and separation of personal and business funds.

What happens if I stop operating as a sole trader?
You must file any final tax returns, deregister from VAT (if applicable), and notify the Registrar General’s Department of your business closure.

Are there government incentives for new sole traders?
There are no universal tax breaks for sole traders, but sector-specific grants or support may be available through government programs.

Can I use Deel as a sole trader to get paid by international clients?
Yes. Deel allows sole traders to receive global payments, supports multiple currencies, and offers transparent exchange rates.

Does Deel generate compliant invoices for sole traders?
Yes. Deel automatically generates legally compliant invoices that meet tax and regulatory standards.

Can Deel help me with taxes as a sole proprietor in Trinidad and Tobago?
Yes. Deel provides downloadable reports and records that simplify tax filing and compliance, though it does not replace an accountant.

Does Deel offer contracts for freelancers and sole traders?
Yes. Deel includes contract templates that comply with local laws to ensure professional and safe client agreements.

Can I access benefits through Deel as a sole trader?
Yes. Deel provides access to optional perks such as health insurance, retirement savings plans, and other benefits traditionally available to employees.