Tax rates in Angola - International Trade Portal

Tax rates in Angola

Tax Rates

Consumption Taxes

Nature of the Tax

All entities with a turnover or goods import operations higher than AOA 350,000,000 are liable to the standard VAT regime. These taxpayers and those that choose to be framed in the standard regime should assess VAT on the supplies of goods and services and, in principle, are able to deduct the VAT incurred on their purchases. Entities operating in the manufacturing industry are always obliged to be on the standard VAT regime. However, the entities operating in the manufacturing industry whose turnover or import of goods is less than AOA 10,000,000 can be excluded from the standard VAT regime.

Entities that exceed a turnover or engage in goods import operations surpassing AOA 350,000,000 are obligated to adhere to the standard VAT regime. These taxpayers, as well as those who opt for the standard regime voluntarily, are responsible for evaluating VAT on their supplies of goods and services. They generally have the ability to deduct the VAT paid on their purchases. In the manufacturing industry, all entities are required to follow the standard VAT regime. However, entities operating in manufacturing but having a turnover or import of goods below AOA 10,000,000 may be exempted from the standard VAT regime.

Every corporate and individual entity engaged in taxable economic activities is required to complete registration with the appropriate tax department. The documentation for the commencement of activities must be submitted no later than 15 days before the planned start of operations.

Tax Rate

14%

Reduced Tax Rate

Exempt supplies include medication and other related products for therapeutic and prophylactic ends; wheelchairs and similar vehicles destined for people with disabilities as well as braille machines and other gadgets used to correct learning disabilities; books; leasing and letting of immovable property for housing purposes (excluding the accommodation services provided by hotels and entities with similar activity); collective public transportation services; banking and financial operations carried out by banking financial institutions and non-banking financial institutions, including the financial leasing; insurance activities; supply of fuels according to Annex II of the VAT Code.
Exports are zero-rated.
A reduced rate of 5% applies to certain food products and agricultural inputs. For the items listed in Annex I of OGE 2022, the reduced rate stands at 7% (e.g. milk, beans, rice, water, meat, fish, eggs, soap, and other agricultural inputs).

Hotel and restaurant services are eligible for the 7% reduced rate only if the service providers fulfill the following requirements simultaneously:

Registration of all owned or utilized immovable properties and/or motor vehicles by the service provider
Utilization of electronic invoicing systems for invoice issuance
Timely submission of the required tax returns from previous years.

Other Consumption Taxes

Several products are subject to excise duties, including sugar and alcoholic beverages; tobacco and its derivatives; fireworks; oil derivatives; jewellery and goldsmith articles; aircraft and pleasure craft; firearms; art objects, collages, and antiques; petroleum products; vehicles; plastic bags and straws; tires. Rates vary between 2%, 5%, 19%, 25% and 30%, depending on the product.

Corporate Taxes

Company Tax: The standard rate is 25%
Taxpayers paying corporate tax are divided into 2 groups: the general regime applies to taxpayers whose revenue is over USD 250,000 for two consecutive or non-consecutive years; the simplified regime applies to taxpayers with business turnover below or equal to USD 250,000.
Public companies, public entities, financial institutions, companies under special tax regimes, telecom companies, and subsidiaries or branches of foreign entities are excluded from the simplified regime.
Tax Rate For Foreign Companies: Tax residents are taxed on worldwide profits. Non-resident firms are only taxed on their Angola-sourced income. The repatriation of profits by permanent establishments of non-resident companies in Angola is taxable under the investment income tax at a rate of 10%.
Strategic investment projects from foreign companies may be eligible for tax incentives under the Private Investment Law (e.g. reduction of the corporate tax rate by 20% for two years). Exemptions from corporate income tax are provided for non-resident shipping and airline operators.
The withholding tax rate for services provided by nonresident entities has been raised from 6.5% to 15%. The paying company is responsible for retaining this withholding tax, which can be deducted by the service provider on their corporate income tax return ("Modelo 1") as an advance payment, up to the assessed tax amount. If the amount withheld exceeds the assessed tax, the surplus can be carried forward and applied to the corporate tax liability for the following 5 years.
Capital Gains Taxation: Capital gains obtained by resident companies are included in taxable income and taxed at the standard flat rate of 25%. Capital gains derived from the sale of shares are not liable to corporate income tax, but are subject to investment income tax (generally at 10%, conditions apply).
Main Allowable Deductions and Tax Credits: Amortisation of tangible and intangible assets is tax-deductible at rates ranging from 4% to 33.33%. Depreciations that exceed the allowed rates are not immediately tax-deductible; however, they may be deducted in subsequent years. Depreciation rates are increased by 25% for companies operating on two shifts and 50% for companies operating on continuous production.
Goodwill cannot be amortised for tax purposes. Interest expenses are tax-deductible (interest on shareholder loans is deductible up to the limit that would result from the annual average interest rate established by the Angolan Central Bank). Bad debts are deductible if they result from the bankruptcy or insolvency of the debtor. The deductibility of donations to charitable organisations depends on their compliance with the Angolan law on patronage. Donations that are not covered by the Patronage Law are subject to autonomous taxation at a rate of 15%. Fines are not tax-deductible, unlike indirect taxes.
Expenses for which there is no valid supporting documentation and whose occurrence and nature are not materially verifiable are subject to a standalone tax at rates varying between 30% and 50%.
Tax losses can be carried forward for up to five years. The carryback of losses is not permitted. Payments to foreign affiliates are deductible if they respect the arm's-length principle.
Other Corporate Taxes: Stamp duties ranging generally from 0.1% to 1% are levied on virtually all transactions, including real estate, insurance and corporate acts, except, among others, those relating to a loan agreement.
A property tax (IPU) is levied on income from real estate. The rate is 25% for rental income; however, it only applies to 60% of income, which results in an effective rate of 15%. For real estate that is not rented, the tax only applies at a rate of 0.5% if the value of the property exceeds 6 million AOA (plus AOA 5,000 for a value between AOA 5 and 6 million). Property transfer taxes (SISA) amount to 2% of the higher of (i) the selling price or (ii) the property value registered for tax purposes.
Social security contributions payable by the employer amount to 8% of the salary and cover the health insurance and the pension plan.
An investment income tax of 15% applies to standard interest gains (credit, loan; 10% for dividends and repatriation of profits; bond interest; interest from shareholder loans; capital gains; and royalties; 5% for interest and capital gains on bonds, securities, or other financial instruments and dividends and capital gains on shares when traded in a regulated market).
Other Domestic Resources: Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Country Comparison For Corporate Taxation

	Angola	Sub-Saharan Africa	United States	Germany
Number of Payments of Taxes per Year	31.0	36.6	10.6	9.0
Time Taken For Administrative Formalities (Hours)	287.0	284.8	175.0	218.0
Total Share of Taxes (% of Profit)	49.1	47.3	36.6	48.8

Source: Doing Business, Latest available data.

Individual Taxes

Tax Rate

Income tax (in AOA)	Progressive rates from 0% to 17%
Up to 70,000	0%
Between 70,001 and 100,000	3,000 + 10% upon the excess of 70,000
Between 100,001 and 150,000	6,000 + 13% upon the excess of 100,000
Between 150,001 and 200,000	12,500 + 16% upon the excess of 150,000
Between 200,001 and 300,000	31,250 + 18% upon the excess of 200,000
Between 300,001 and 500,000	49,250 + 19% upon the excess of 300,000
Between 500,001 and 1,000,000	87,250 + 20% upon the excess of 500,000
Between 1,000,001 and 1,500,000	187,250 + 21% upon the excess of 1,000,000
Between 1,500,001 and 2,000,000	292,250 + 22% upon the excess of 1,500,000
Between 2,000,001 and 2,500,000	402,250 + 23% upon the excess of 2,000,000
Between 2,500,001 and 5,000,000	517,250 + 24% upon the excess of 2,500,000
Between 5,000,001 and 10,000,000	1,117,250 + 24.5% upon the excess of 5,000,000
Above 10,000,001	2,342,250 + 25% upon the excess of 10,000,000
Self-employed workers	25% Fees paid to self-employed individuals are subject to a 6.5 % withholding tax when the payer has organized or simplified accounting models.
Individuals carrying out industrial or commercial activitiy	25% (applicable to profits established in the minimum profits table), 6.5% (applicable to the turnover if it exceeds four times the maximum value established in the minimum profits table)

Allowable Deductions and Tax Credits

Social security contributions are deductible. Self-employed individuals can be eligible for tax deductions for their business-related expenses, within certain limits; whereas business deductions are allowed for employees.

Special Expatriate Tax Regime

Residents are taxed on their global income, whereas non-residents are taxed at the same rates as residents only on their Angola-sourced income.

In accordance with the General Tax Code, an individual is considered a resident of Angola for tax purposes if they meet either of the following conditions:

possesses a residence (habitual residence) in Angola on December 31st of each fiscal year
spends a total of more than 90 days, whether consecutive or not, in Angola during each fiscal year.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed: The double taxation treaty between Angola and Portugal came into force in 2019.

The treaties signed with the United Arab Emirates, China and Cabo Verde did not come into force yet.
Withholding Taxes: 10% for dividends (5% for dividends on shares when traded in a regulated market); 15% for interest (10% for bond interest and interest from shareholder loans, 5% for interest on financial instruments issued by a company that trades in a regulated market); and 10% for royalties. Payment of services is usually subject to a withholding tax of 6.5%. Educational, medical and transport services are exempt.

Sources of Fiscal Information

Tax Authorities: Overview of Angola's tax measures in response to Covid-19
General Tax Administration
Other Domestic Resources: Ministry of Finance - Tax legislation
AIPEX - Angola's Private Investment and Export Promotion Agency

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