Angola

Angola

Thinking beyond borders

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Individuals are subject to taxation on personal income tax on their Angolan source income obtained, irrespective of their place of residence. Income tax is levied at progressive rates over the individual’s annual taxable income.

Key message

Extended business travellers are likely to be taxed on Angolan source income.

Income tax

Liability for income tax

  • According to the Angolan tax law, a person’s liability to tax in Angola is determined by the source of his/her income, irrespective of his/her place of residence. 
  • Employment income tax is due on any income resulting from personal services rendered in Angola, by employed or self-employed individuals, who are directly or indirectly paid by an Angolan based entity, irrespective of the residence status of the individual. 
  • Employment income is subject to monthly withholding tax to be made by the employer and paid to the tax authorities on a monthly basis. 

Tax trigger points

  • There is no minimum number of days rule that exempts the employee from the requirements to pay tax in Angola.

Types of taxable income

For extended business travellers, the types of income that are generally subject to tax are employment income, business and professional income.

The employment/ business and professional income are segmented into three taxation groups:

  • Group A - includes the remuneration earned by employees (paid by an employer entity under an employment contract entered into in accordance with the Labor Law), as well as the remuneration earned by public servants;
  • Group B - includes the remuneration received by entrepreneurs / freelance workers that falls under the activities’ list included as an attachment to the PIT Code, as well as remuneration earned by directors and members of the board or of other statutory bodies;
  • Group C - includes all the remuneration obtained as a result of the development of an industrial or commercial activity, as foreseen in the Table of Minimum Profits.

Tax rates

  • Group A – taxable income is determined by deducting from the gross earnings the mandatory contributions to Social Security and the remuneration components not subject or exempt from PIT.
    • This rule is also applicable to earnings of directors and members of the board or of other statutory bodies (even if said persons are classified under the taxation Group B). Employees are subject to personal income tax at the progressive rates up to a maximum rate of 17 percent.
  • Group B – The taxable income corresponds to 70% of the earnings, when these are paid by companies or by individuals with organized accounting; for the remaining cases, the income is determined based on the accounting, on the taxpayers’ accounting records, on records available for the purchases, sales and services rendered, or on the information the Tax Administration has available.
    • The deduction of expenses related to the respective activity (as expressly foreseen in the Code), up to the limit of 30% of the gross earnings of the taxpayer, is still available. Independent professionals (including directors and members of the board or of other statutory bodies) are subject to tax at a single flat rate of 15 percent.
  • Group C – The taxable income corresponds to the amounts indicated in the Table of Minimum Profits, apart from a few exceptions where the taxable earnings correspond to the amount of the sales and services rendered.
    • Applicable rate of 30% for the cases in which the taxable income corresponds to the amounts included in the Table of Minimum Profits and, for the remaining cases, a rate of 6.5% (harmonization with the Industrial Tax rules).

Social security

Liability for social security

  • Social security is only mandatory for Angolan nationals and for individuals with a residency permit.
  • Subject to this condition, the employee and the employer must contribute 3 percent and 8 percent, of the employee’s gross salary, respectively.

Compliance obligations

Employee compliance obligations

  • Employment income tax is withheld by the employer on salaries paid to employees. As the withholdings correspond to the final taxes due in Angola, the employee has no reporting obligation herein. 

Employer reporting and withholding requirements

  • The employer is required to withhold tax on the salaries and wages of their employees on a monthly basis.
  • The employer is also required to report the income paid and tax withheld to the employee to the tax authorities.

Immigration

Work permit/visa requirements

  • A visa must be applied for before the individual enters Angola. The type of visa required will depend on the purpose of the individual’s entry into Angola. 

Other issues

Double taxation treaties

  • Angola has not concluded, up to now, any double tax agreement

Permanent establishment implications

  • There is potential that a permanent establishment could be created as a result of extended business travel, but this would be dependent on the type of services performed and the level of authority the employee has.

Indirect taxes

There is no “value added tax” in Angola. However, a consumption tax applies on supplies and imports of goods and services within the Angolan tax territory.

Transfer pricing

Angola has a transfer pricing regime. 

Local data privacy requirements

Angola has data privacy laws.

Exchange control

All foreign exchange transactions are subject to comply with the exchange control regulations imposed by the national bank. Under such regulations there are limitations on the amount of money that can be transferred out of Angola.

Non deductible costs for assignees

  • Not applicable

Other

  • Not applicable

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