The Pay-As-You-Earn System, popularly referred to as PAYE, was introduced in St. Lucia in 1965. The legislation dealing with its operation is contained in the Fourth Schedule of the Income Tax Act Chap. 15.02, as well as sections 75, 76, 77, 78 and 143.
PAYE is not a method of assessment of income tax, but merely a system of withholding tax from emoluments as they are paid. Therefore, although tax has been deducted by way of PAYE from emoluments, an employee must, nevertheless, file an Income Tax Return.
“Emoluments” means all salary, wages, bonus, overtime, perquisites or privileges which include house allowance and entertainment, commission or other amounts for services, director’s fees, pensions arising or accruing in, derived from or received in St. Lucia, and which is liable to income tax.
This does not include, however, salary or share of profits arising from a trade, profession or vocation carried on by any person either by himself or in partnership with another person.