Angola: Business Environment

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.

Tax Rate

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.