Papua New Guinea – Taxation of international executives

Taxation of international executives

Taxation of international executives

  

Overview and Introduction

Papua New Guinea individual income taxes, to which all expatriates are subject, are calculated using graduated rates, from 0 percent to 42 percent.

Residents are subject to tax on their worldwide income whether sourced inside or outside of Papua New Guinea, subject to specific credit relief. Non-residents are subject to tax on income derived directly or indirectly from sources within Papua New Guinea only.

The official currency of Papua New Guinea is the Papua New Guinea Kina (PGK).

Herein, the host country/jurisdiction refers to the country/jurisdiction to which the employee is assigned. The home country/jurisdiction refers to the country/jurisdiction where the assignee lives when they are not on assignment.

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Income Tax

Tax returns and compliance

When are tax returns due? That is, what is the tax return due date?

Individuals who do not lodge an income tax return through an approved tax agent must lodge a return within 2 months of the end of the year of income (28 February). Individuals lodging through an approved tax agent usually lodge within 6 months of the end of the year of income (30 June). Where the only income derived by an individual is salary or wages, and salary or wages tax has been paid, income tax returns do not need to be lodged.

What is the tax year-end?

31 December.

What are the compliance requirements for tax returns in Papua New Guinea?

Residents and non-residents

If an income tax return is required, the same lodgment deadlines apply to both PNG tax residents and non-residents.

An extension of time for filing income tax returns is usually obtained by written application to the Commissioner General of the Internal Revenue stating reasons for the extension. The length of extension is at the discretion of the Commissioner General.

Where a tax agent lodges income tax returns, the tax agent applies for lodgment extensions. Generally the Internal Revenue Commission (“IRC”) requires tax agents to lodge taxable returns as follows:

  • 30 percent of returns by 30 April
  • 75 percent of returns by 31 May
  • 100 percent of returns by 30 June
  • 100 percent of non taxable returns by 31 July

Tax rates

What are the current income tax rates for residents and non-residents in Papua New Guinea?

Income tax table effective as of 1 January 2019.

Residents

The rates for individuals who are residents are as follows:

Taxable Income

Tax Rate

The part of taxable income that:

%

Does not exceed PGK12,500

0

exceeds PGK12,500 but does not exceed PGK20,000

22

exceeds PGK20,000 but does not exceed PGK33,000

30

exceeds PGK33,000 but does not exceed PGK70,000

35

exceeds PGK70,000 but does not exceed PGK250,000

40

exceeds PGK250,000

42

Non-residents

The rates for individuals who are non-residents are as follows:

Taxable Income

Tax Rate

The part of taxable income that:

%

Does not exceed PGK20,000

22

exceeds PGK20,000 but does not exceed PGK33,000

30

exceeds PGK33,000 but does not exceed PGK70,000

35

exceeds PGK70,000 but does not exceed PGK250,000

40

exceeds PGK250,000

42

Note that non-residents do not benefit from the tax-free threshold.

Residence rules

For the purposes of taxation, how is an individual defined as a resident of Papua New Guinea?

The Income Tax Act defines a resident of Papua New Guinea for taxation purposes to be a person who resides in Papua New Guinea and includes a person with the characteristics below:

  • whose domicile is in Papua New Guinea, unless the Commissioner General is satisfied that their permanent place of abode is outside Papua New Guinea
  • who has actually been in Papua New Guinea, continuously, or intermittently, during more than one-half of the year of income, unless the Commissioner General is satisfied that their usual place of abode is outside Papua New Guinea, and that they do not intend to take up residence in Papua New Guinea
  • who is a contributor to a prescribed superannuation fund or is the spouse or child under 16 years of age of such a contributor.

Is there, a de minimus number of days rule when it comes to residency start and end date? For example, a taxpayer can’t come back to the host country/jurisdiction for more than 10 days after their assignment is over and they repatriate.

There is no such requirement.

What if the assignee enters the country/jurisdiction before their assignment begins?

The assignee is considered to be in Papua New Guinea for those days.

Termination of residence

Are there any tax compliance requirements when leaving Papua New Guinea?

Where a person derives only salary or wages income there is no requirement. However where the person earns any other income apart from salary or wages income then annual income tax returns should be lodged and assessed. The person should be up to date with the lodgment of the tax returns and the payment of the taxes assessed.

What if the assignee comes back for a trip after residency has terminated?

If it can be proved that their place of abode is outside Papua New Guinea, they will not be considered a resident of Papua New Guinea.

Communication between immigration and taxation authorities

Do the immigration authorities in Papua New Guinea provide information to the local taxation authorities regarding when a person enters or leaves Papua New Guinea?

It is possible for the immigration authorities to provide information to the IRC and there is a precedent for this. 

Filing requirements

Will an assignee have a filing requirement in the host country/jurisdiction after they leave the country/jurisdiction and repatriate?

If the assignee does not derive any income in Papua New Guinea after they leave, there would not be any filing requirement in Papua New Guinea.

Economic employer approach

Do the taxation authorities in Papua New Guinea adopt the economic employer approach1 to interpreting Article 15 of the OECD treaty? If no, are the taxation authorities in Papua New Guinea considering the adoption of this interpretation of economic employer in the future?

No, the taxation authorities in Papua New Guinea do not adopt the economic employer approach to interpreting Article 15 of the OECD treaty and KPMG in Papua New Guinea is not aware of any plans to do so.

De minimus number of days

Are there a de minimus number of days2 before the local taxation authorities will apply the economic employer approach? If yes, what is the de minimus number of days?

Not applicable.

Types of taxable compensation

What categories are subject to income tax in general situations?

As a rule, it can be stated that all types of compensation and benefits received by an employee for services rendered constitute taxable income regardless of where paid. Typical items of an expatriate compensation package, which are fully taxable, are as follows:

  • salary or wages
  • reimbursements of foreign and/or home country/jurisdiction taxes
  • cost-of-living allowances
  • the benefit of loans at reduced or zero interest rates provided by the employer
  • round sum expense allowances
  • share option exercises
  • Accommodation, motor vehicles and meals provided to the employee. These benefits may be concessionally taxed where certain requirements are met.

Intra-group statutory directors

Will a non-resident of Papua New Guinea who, as part of their employment within a group company, is also appointed as a statutory director (i.e. member of the Board of Directors in a group company situated in Papua New Guinea trigger a personal tax liability in Papua New Guinea, even though no separate director's fee/remuneration is paid for their duties as a board member?

No.

a) Will the taxation be triggered irrespective of whether or not the board member is physically present at the board meetings in Papua New Guinea?

No.

b) Will the answer be different if the cost directly or indirectly is charged to/allocated to the company situated in Papua New Guinea (i.e. as a general management fee where the duties rendered as a board member is included)?

No.

c) In the case that a tax liability is triggered, how will the taxable income be determined?

 Not applicable.

Tax-exempt income

Are there any areas of income that are exempt from taxation in Papua New Guinea? If so, please provide a general definition of these areas.

The following benefits are not subject to tax where the relevant conditions are met (the PNG tax office has imposed various administrative requirements to qualify for the exemptions):

  • education/tuition paid for children
  • one annual leave airfare to home country/jurisdiction (employee plus dependents).

Education allowances

Where an employer directly pays the annual fees imposed by a primary or secondary school or college for the purpose of educating a student child of an employee, the amount paid is exempt from tax. This exemption does not extend to expenses or fees relating to tertiary studies.

Annual leave airfare to home country/jurisdiction

A benefit provided to an employee by way of the following:

  • one annual leave fare for themselves and their family paid from the place of their employment to the employee’s place of origin or recruitment
  • recreational fares and accommodation within Papua New Guinea, not exceeding the value of the benefit above

is exempt from income tax provided the benefit is applied exclusively for the purposes referred to above and it is not given as a cash allowance to the employee.

Concessional benefits

Housing allowances and housing are taxable at notional values as set out in the following table.

Type of housing

Value of taxable benefit per fortnight

 

Area 1 (PGK)

Area 2 (PGK)

Area 3 (PGK)

Very high cost house or flat

2,500

1,500

0

Up-market cost house or flat

1,500

1,000

0

High cost house or flat

700

500

0

Medium cost house or flat

400

300

0

Low cost house or flat

160

150

0

Mess/Barracks accommodation

60

50

0

Government mess/barracks accommodation

7

0

0

Employees in approved low cost housing scheme

0

0

0

The provision of a motor vehicle to an employee is taxable to the employee. The taxable amount is PGK125 per fortnight where fuel is supplied by the employer and PGK95 per fortnight where no fuel is supplied.

Expatriate concessions

Are there any concessions made for expatriates in Papua New Guinea?

None.

Salary earned from working abroad

Is salary earned from working abroad taxed in Papua New Guinea? If so, how?

If an individual is a non-resident of Papua New Guinea the salary payments for working abroad are not taxable in Papua New Guinea, provided it is not PNG source employment income.

Residents are fully taxable on foreign earnings. That is, residents are taxed on their worldwide income.

Taxation of investment income and capital gains

Are investment income and capital gains taxed in Papua New Guinea? If so, how?

Non-Papua New Guinea investment income is taxable when derived by a resident.

There is no capital gains tax in Papua New Guinea, although income tax may be levied on profits realized from the sale of assets acquired for the purpose of reselling at a profit.

Dividends, interest, and rental income

Interest and rental income are fully taxable in Papua New Guinea at the taxpayer's marginal rate of tax. Dividends which have been subject to PNG dividend withholding tax are not assessable to resident trusts or individuals, nor to any non-resident entity.

Foreign exchange gains and losses

Exchange gains/losses are taxable/deductible when realized and if trade related.

Principal residence gains and losses

Not applicable.

Capital losses

There is no capital gains tax in Papua New Guinea except where the asset is acquired for the purpose of profit making by sale. Where a loss is incurred, the loss is deductible provided notification of the profit making intention was made to the Commissioner by the due date of lodging the first return after acquiring the property.

Personal use items

There is no income tax applicable.

Gifts

There is no capital acquisitions tax in Papua New Guinea.

Additional capital gains tax (CGT) issues and exceptions

Are there additional capital gains tax (CGT) issues in Papua New Guinea? If so, please discuss?

No.

Are there capital gains tax exceptions in Papua New Guinea? If so, please discuss?

Pre-CGT assets

Not applicable.

Deemed disposal and acquisition

Not applicable.

General deductions from income

What are the general deductions from income allowed in Papua New Guinea?

Tax rates take into account an allowance for expenses of up to PGK200. Expenses in excess of PGK200 are relieved by means of a rebate of tax payable of 25 percent of those expenses.

Additionally, standard dependent rebates are available for salary and wage earners. The individual income tax rates used for the calculation of salary or wages tax incorporate rebates for dependents as well as the blanket deduction for expenses of PGK200 per year.

The dependent rebates are very small and calculated as follows:

  • first dependent: 15 percent of gross tax with a maximum of PGK450 and minimum of PGK45;
  • second and third dependents: 10 percent of gross tax, with a maximum of PGK300 and a minimum of PGK30 for each dependent.

A maximum of three dependents may be claimed. Dependent rebates are available to residents only.

Tax reimbursement methods

What are the tax reimbursement methods generally used by employers in Papua New Guinea?

Tax reimbursements rarely need to be considered in Papua New Guinea.

Calculation of estimates/prepayments/withholding

How are estimates/prepayments/withholding of tax handled in Papua New Guinea? For example, Pay-As-You-Earn (PAYE), Pay-As-You-Go (PAYG), and so on.

Salary or Wages Tax under the PAYE system is assessed on a fortnightly rather than an annual basis. It is remitted by all employers (including foreign companies operating through a permanent establishment or a permanent representative) to the IRC on a monthly basis.

Remuneration paid as consultancy fees or for other professional services rendered in Papua New Guinea is also considered to be salary or wages income, as is any compensation for services rendered in Papua New Guinea, which is paid outside Papua New Guinea. The salary or wages tax is based on individual income tax rates and is a first and final tax on salary and wage earnings. The rates of tax used by employers to calculate the fortnightly deductions incorporate rebates for dependents (for employees) as well as a blanket deduction for expenses of PGK200 per year incurred in earning salary or wages income.

Individuals who derive non-salary or wage income are required to pay provisional tax on that income. Provisional tax is assessed on an annual basis and is payable in three equal instalments by the end of April, July and October for the relevant year. The provisional tax paid is allowed as a credit in that year’s assessment, when processed in the following year.

Pay-as-you-go (PAYG) withholding

As detailed earlier.

PAYG Installments

When are estimates/prepayments/withholding of tax due in Papua New Guinea? For example: monthly, annually, both, and so on.

The salary and wages tax deducted for the month should be remitted by the employer to the IRC on or before the seventh day of the following month.

Relief for foreign taxes

Is there any Relief for Foreign Taxes in Papua New Guinea? For example, a foreign tax credit (FTC) system, double taxation treaties, and so on?

A foreign tax credit is available where Papua New Guinea taxes foreign-source income. Where the income is derived from a non-treaty country/jurisdiction, Papua New Guinea will generally allow unilateral relief for foreign taxes payable, up to a maximum of the Papua New Guinea tax payable on the same source of income.

General tax credits

What are the general tax credits that may be claimed in Papua New Guinea? Please list below.

In general, a credit can be claimed for all foreign taxes paid including interest, dividend, and other withholding taxes. A credit can also be claimed for the income tax paid upon the issue of assessment in respect of foreign rental income, and so on. The credit allowed is limited to a maximum of the amount that bears to the Papua New Guinea tax of the taxpayer the same proportion as the non-Papua New Guinea income of the taxpayer bears to the sum of the taxable income and salary and wages income of the taxpayer.

Sample tax calculation

This calculation assumes a married taxpayer resident in Papua New Guinea with two children whose 3-year assignment begins 1 January 2020 and ends 31 December 2022. The taxpayer’s base salary is 100,000 US dollars (USD) and the calculation3 covers 3 years.

 

2020

USD

2021

USD

2022

USD

Salary

100,000

100,000

100,000

Bonus

20,000

20,000

20,000

Cost-of-living allowance

10,000

10,000

10,000

Housing rental paid by employer

12,000

12,000

12,000

Company car

6,000

6,000

6,000

Moving expenses

20,000

0

20,000

Home leave fare

5,000

5,000

5,000

Interest income from non-local sources

6,000

6,000

6,000

Exchange rate used for calculation: USD1.00 = PGK2.935

Other assumptions

  • All earned income is attributable to local sources.
  • Bonuses are paid at the end of each tax year, and accrue evenly throughout the year.
  • Interest income is not remitted to Papua New Guinea.
  • The company car is used for business and private purposes and originally cost USD50,000.
  • The employee is deemed resident throughout the assignment.
  • Tax treaties and tax equalization agreements are ignored for the purpose of this calculation.

Calculation of taxable income

Year ended

2020

PGK

2021

PGK

2022

PGK

Days in Papua New Guinea during year

366

365

365

Earned income subject to income tax

 

 

 

Salary

293,500

293,500

293,500

Bonus

58,700

58,700

58,700

Cost-of-living allowance

29,350

29,350

29,350

Prescribed housing benefit

4,160

4,160

4,160

Prescribed motor vehicle benefit

3,250

3,250

3,250

Moving expense reimbursement

0

0

0

Home leave fare

0

0

0

Total earned income

388,960

388,960

388,960

Other income

17,610

17,610

17,610

Total income

406,570

406,570

406,570

Deductions

0

0

0

Total taxable income

406,570

406,570

406,570


Calculation of tax liability

 

2020

PGK

2021

PGK

2022

PGK

Taxable income as above

406,570

406,570

406,570

Papua New Guinea tax thereon

156,259

156,259

156,259

Less:

 

 

 

Domestic tax rebates (dependent credit)

1,050

1,050

1,050

Foreign tax credits*

1,761

1,761

1,761

Total Papua New Guinea tax

153,448

153,448

153,448

* Assuming 10 percent foreign withholding tax paid.

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FOOTNOTES:

1 Certain tax authorities adopt an "economic employer" approach to interpreting Article 15 of the OECD model treaty which deals with the Dependent Services Article. In summary, this means that if an employee is assigned to work for an entity in the host country/jurisdiction for a period of less than 183 days in the fiscal year (or a calendar year of a 12-month period), the employee remains employed by the home country/jurisdiction employer but the employee’s salary and costs are recharged to the host entity, then the host country/jurisdiction tax authority will treat the host entity as being the "economic employer" and therefore the employer for the purposes of interpreting Article 15. In this case, Article 15 relief would be denied and the employee would be subject to tax in the host country/jurisdiction.

2 For example, an employee can be physically present in the country/jurisdiction for up to 60 days before the tax authorities will apply the ‘economic employer’ approach.

3 Sample calculation generated by KPMG, a Papua New Guinea member firm affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity, based on the Papua New Guinea Income Tax Act 1959

  

Special considerations for short-term assignments

Residency rules

Payroll considerations

Taxable income

Additional considerations

For the purposes of this publication, a short-term assignment is defined as an assignment that lasts for less than 1 year.

Residency Rules

Are there special residency considerations for short-term assignments?

None.

Payroll considerations

Are there special payroll considerations for short-term assignments?

None.

Taxable income

What income will be taxed during short-term assignments?

All of the income earned in Papua New Guinea will be taxable. If the person is a resident foreign income is also taxed in Papua New Guinea. A credit is available for foreign taxes paid.

Additional considerations

Are there any additional considerations that should be considered before initiating a short- term assignment in Papua New Guinea?

None.

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Other taxes and levies

Social security tax

Are there social security/social insurance taxes in Papua New Guinea? If so, what are the rates for employers and employees?

No social security taxes in Papua New Guinea.

Superannuation is not compulsory for expatriates.

Employer and employee

Employers of 15 or more persons are required to register with an Approved Superannuation Fund. Membership of the fund is compulsory for citizens of Papua New Guinea and voluntary for expatriates.

For citizen employees, the employer is required to contribute 8.4 percent of the employee's gross taxable salary and the employee is required to contribute 6 percent. The maximum deductible amount that an employer may contribute for an employee is 15 percent of the employee's gross taxable salary.

Employer sponsored superannuation benefits accruing after 1 January 1993 are fully taxable on the termination of employment unless contributions have been made for the employee for more than 5 years, in which case a reduced rate of tax applies calculated according to the number of years contributions have been made and the age of the employee.

Gift, wealth, estate, and/or inheritance tax

Are there any gift, wealth, estate, and/or inheritance taxes in Papua New Guinea?

There are no estate, gift, or inheritance taxes in Papua New Guinea, although stamp duty does apply on the gifting of assets such as real property.

Real estate tax

Are there real estate taxes in Papua New Guinea?

Land tax is imposed at the provincial government level.

Sales/VAT tax

Are there sales and/or value-added taxes in Papua New Guinea?

Yes, at the standard rate of 10 percent subject to exemption or zero-rating of particular supplies.

Unemployment tax

Are there unemployment taxes in Papua New Guinea?

No.

Other taxes

Are there additional taxes in Papua New Guinea that may be relevant to the general assignee?

For example, customs tax, excise tax, stamp tax and so on.

Customs and/or excise duty and GST may be payable on the import of goods.

Local taxes

There are import duties and excise tax applicable to certain goods mainly with the intention of protecting local industries. Stamp duty applies to conveyances of real estate and other specified instruments.

Foreign financial assets

Is there a requirement to declare/report offshore assets (e.g. foreign financial accounts, securities) to the country/jurisdiction’s fiscal or banking authorities?

Individuals are not required to declare/report offshore assets unless the individual is acting in the capacity of a director of a financial institution.

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Immigration

Following is an overview of the concept of Papua New Guinea’s immigration system for skilled labor.

(E.g. which steps are required, authorities involved, in-country/jurisdiction and foreign consular processes, review/draft flow chart illustrating the process)

This summary provides basic information regarding business visits to, and work authorization for, Papua New Guinea. The information is of a general nature and should not be relied upon as legal advice.

All non-citizens entering Papua New Guinea for work activities are required to hold an Employment Visa and a Work Permit.

Generally a work permit is mandatory for non-citizens, however there are a few exceptions. Work permits are processed and monitored by the Department of Labour and Industrial Relations (Foreign Employment Division).

Papua New Guinea also has visa arrangements whereby non-citizens can travel to Papua New Guinea for work, business, study or tourism purposes. Visas are issued by the Papua New Guinea Immigration and Citizenship Services and allow a non-citizen to enter Papua New Guinea and remain for a specific period upon approval of the work permit.

An employment visa must also be obtained by the expatriate employee prior to commencing work in Papua New Guinea. For new applicants the visa will need to be transmitted overseas to a PNG Consulate/ PNG High Commission or an Australian embassy in their place of origin.

International Business Travel/Short-Term Assignments

Describe (a) which nationalities may enter Papua New Guinea as non-visa national, (b) which activities they may perform and (c) the maximum length of stay.

In some cases, a treaty or special agreement authorizes citizens of certain countries/jurisdictions to enter Papua New Guinea without obtaining a visa. Visitor and business entry permits are available for nationals from eligible countries/jurisdictions.

In Papua New Guinea, business visitors must generally limit their activities to the following:

  • Attending meetings and negotiations, preparing contract offers, signing contracts and supervising the implementation of contracts for an employer outside Papua New Guinea;
  • Attending internal business meetings or discussions;
  • Attending or holding internal seminars or trainings;
  • Conduct an exploratory business visit;
  • Participate in business negotiations

Business visitors are generally prohibited from engaging in productive employment activities that are an extension of professional activities.

Describe (a) the regulatory framework for business travelers being visa nationals (especially the applicable visa type), (b) which activities they may perform under this visa type and the (c) maximum length of stay.

Visa nationals are required to obtain a Papua New Guinea visa to be able to enter Papua New Guinea for business visitor activities. In Papua New Guinea business visas are available in two categories – Short Term Single Entry for 30 days only and multiple entry visa for 60 days. However, from October 2018 the multiple entry visa (which is valid for 60 days) was put on hold and incoming non-citizens are currently using the short term single entry visa (for 30 days) to enter PNG. The single entry visa of 30 days can also be obtained online by an applicant.

In regards to the permitted activities and permitted duration of stay please see above response.

Outline the process for obtaining the visa type(s) named above and describe (a) the required documents (including any legalization or translation requirements), (b) process steps, (c) processing time and (d) location of application.

The required documents for a business visitor visa are as follows:

  • Valid passport or travel document;
  • Established purpose for the visit (i.e. Letter of Invitation (LOI) from the Papua New Guinea company including a guarantee to cover certain expenses);
  • Confirmation letter of the employer, if requested;
  • Proof of return or onward travel;
  • Proof of sufficient funds to cover all costs while in Papua New Guinea;

The above documents must be provided in English.

The process involves the gathering of documents, completion of the application and submission of the visa application with the Papua New Guinean embassy/ consulate at the place of residence. This processing time is approximately 7 to 15 business days.

Are there any visa waiver programs or specific visa categories for technical support staff on short-term assignments?

An applicant for a Restricted Employment visa must demonstrate that they hold specialist technical skills which are required to fill a short-term skills gap in Papua New Guinea i.e. mainly for engineers and technicians

 Restricted Employment visas permits a maximum of four entries in a 12-month period. Each period of stay must not exceed 30 days.

Long-Term Assignments

What are the main work permit categories for long-term assignments to Papua New Guinea? In this context please outline whether a local employment contract is required for the specific permit type.

A work permit may be obtained for up to 3 years. A local employment contract is required.

A Volunteer Long Term work permit is granted mainly to church workers and non-government organizations.

Provide a general process overview to obtain a work and residence permit for long- term assignments (including processing times and maximum validation of the permit).

  • The work permit may be valid for up to 3 years. The work permit application takes 15 to 21 working days from submission although it can be shorter if the documents provided are in order. Documents must be certified where required.

Is there a minimum salary requirement to obtain a long term work and residence permit for assignments? Can allowances be taken into account for the salary?

The minimum salary requirement is PGK40,000 per annum. Allowances can be taken into account for the salary.

Is there a fast-track process which could expedite the visa/ work permit?

Effective 1 January 2021 there was an increase in new work permit fees. The Department of Labour had also introduced a fast track processing fee of PGK300 per application to expedite the process of an application. This process takes 5-7 working days and only applies to applicants falling into specialized categories such as engineers and technicians.

For visa applications lodged with the PNG Immigration Office, there is a priority fast-track fee of PGK 7,000 that applies for the urgent processing f one application. This applies to visas processed in country as well as visas that are processed and sent to an overseas mission for collection. The process takes 1-2 days.

At what stage is the employee permitted to start working when applying for a long term work and residence permit (assignees/ local hire)?

An employee can only start work in Papua New Guinea once they have also obtained both their valid work permit and their visa.

Can a short term permit/ business visa be transferred to a long term permit in Papua New Guinea?

No. Short term business visas cannot be transferred to a work permit (long term permit). Once a work permit is lodged with the Department of Immigration the short term permit/ business visa is automatically cancelled. The individual has to exit Papua New Guinea and can only re-enter when a valid work permit is issued.

Is it possible to renew work and residence permits?

In Papua New Guinea it is possible to renew work and residence permits. The renewal process can take place in Papua New Guinea. The applicant is not required to leave the country/jurisdiction. Generally applications for work permits take some time to be processed. It is highly recommended that the application is lodged at least 3 months before the expiry.

Is there a quota or system or a labor market test in place?

No.

General Immigration Related Questions

Would it be possible to bring family members to Papua New Guinea?

Dependents are allowed to join the main applicant, however each dependent family members must submit a separate application. According to Papua New Guinea immigration law, the following are considered as dependents:

  • spouses (marriage certificate required)
  • unmarried children under 18 years (birth certificates required)
  • aging parents.

In limited cases, dependent entry permits may also be granted to children over the age of 18 where they remain dependent on their parents.

Is it possible to obtain a permanent residence permit?

Yes it is possible. Generally one would be eligible to apply for a permanent residence permit after holding a work permit for 5 years.

What if circumstances change after the Work and Residence application process?

An application notifying of the change in status must be lodged prior to the expiry date of the current entry permit. As applications for work permits take some time to be processed it is highly recommended that the application is lodged at least 3 months before the expiry.

How long can a permit holder leave Papua New Guinea without their permit becoming invalid?

Any extended absences from Papua New Guinea may affect future Long-Term Residency and Citizenship applications. In particular, absences of more than 12 months without reasonable cause will lead to invalidity of the permit if approval of absence has not been obtained from the local immigration authorities.

Must immigration permissions be cancelled by the end of the assignment/employment?

A work permit is automatically cancelled/ becomes invalid if a non-citizen’s employment is terminated for any reason.

Are there any penalties for individuals and/or companies in place for non-compliance with immigration law?

Yes, penalties of up to PGK20,000 can apply.

Other Important Items

List any other important items to note, or common obstacles faced in Papua New Guinea when it comes to the immigration process?

Below is a list of other important items to note:

  • There can be delays in visa processing with the PNG Immigration Office
  • On-line 30 days visa only applies to eligible nationalities
  • Passports must be valid for more than 6 months.

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Disclaimer

All information contained in this publication is summarized by KPMG, the Papua New Guinea member firm of the KPMG global organization of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. The information contained in this publication is based on the Papua New Guinea Income Tax Act 1959 and the Papua Superannuation (General Provisions) Act 2000.

Copyright

©2021 KPMG PNG. KPMG PNG is associated with KPMG Australia, an Australian partnership and a member firm of the KPMG global organisation of independent member firms affiliated with KPMG International Limited, a private English company limited by guarantee. All rights reserved. The KPMG name and logo are trademarks used under license by the independent member firms of the KPMG global organisation.