What is the personal income tax allowance in Grenada?

Compliance

Grenada

DIRECT ANSWER

Every resident individual in Grenada is entitled to a personal allowance deduction of EC$36,000 per year, which is subtracted from gross income before PAYE is calculated on the remaining chargeable income. Employers typically apply this allowance automatically when calculating monthly PAYE withholding.

How the allowance reduces taxable income

The personal allowance is applied before either PAYE band. For an employee earning EC$72,000 annually, the calculation works as follows:

Step	Amount
Gross annual income	EC$72,000.00
Less: personal allowance	− EC$36,000.00
Chargeable income	EC$36,000.00
Taxed at 10% (first EC$24,000)	EC$2,400.00
Taxed at 28% (remaining EC$12,000)	EC$3,360.00
Total annual PAYE	EC$5,760.00

Applying it monthly

For monthly payroll, the annual allowance is typically divided by twelve (EC$3,000 per month) and applied to each pay period before calculating that month's PAYE withholding, rather than being applied once at year end.

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Is the personal allowance applied monthly or annually in Grenada?

It is an annual allowance of EC$36,000, but for payroll purposes it is normally spread across the year — about EC$3,000 per month — so PAYE withholding stays even across pay periods rather than front-loading.

Does every employee in Grenada receive the personal allowance?

Every resident individual is entitled to the personal allowance. Treatment for non-resident employees can differ, so confirm the position with the Inland Revenue Division before running payroll for staff who are not resident in Grenada.