Democratic Republic of Congo: Business Environment

Company Tax

30%

Tax Rate For Foreign Companies

The Democratic Republic of the Congo levies taxes on resident companies and individuals on a territorial basis (or source basis) of taxation. Non-resident companies or individuals that carry out an activity in the Democratic Republic of the Congo are taxable on profits they realise through permanent or fixed establishments that are located within the country.
Branches of foreign companies are liable for taxation of deemed distributed profits, hence on profits realised a branch will pay both the 30% corporate tax and a 20% tax based on 50% of the net profits after deduction of the corporate tax.

Capital Gains Taxation

Capital gains are treated as taxable income and are subject to the standard corporate income tax rate.

Main Allowable Deductions and Tax Credits

Deductible expenses include interests on funds borrowed from third parties and invested in the company (unless the borrower is a private limited company and the lender is one of its shareholders), start-up expenses, rental expenses linked to buildings or parts of buildings used in the exercise of the activity, overhead costs from maintenance of furniture and equipment used in the business activity, wages, salaries, bonuses, and allowances of employees and workers used in the operation, as well as benefits in kind if these have been added to remunerations paid, etc.
Charitable donations, bad debts, fines, penalties and taxes are generally not deductible.
Business losses can be carried forward indefinitely, up to 60% of the tax profits made in the tax period prior to applying the deduction of said business losses. The carryback of losses is not allowed.

Other Corporate Taxes

Other taxes include a property tax (payable by the owner of the property or land, exemptions apply), a transfer tax (payable by the purchaser, at a rate of 3% of the building's value for a normal sale), a business tax of 10% based on pension capital (for companies applying a supplementary pension scheme).
In the event of business termination, companies pay a lump-sum amount as follows: CDF 500,000 for large companies; CDF 250,000 for medium-sized companies; CDF 30,000 for small-sized companies.
Rental income tax applies to income from the rental of buildings and land located in the DRC. Rental income is taxed at 22% in the province of Kinshasa; 20% is withheld and paid by the tenant, and the landlord pays the remaining 2%. The 20% tax due from the tenant must be paid within 10 days following the payment of the rent. The balance of 2% of the rental income received during the year is due and payable by the landlord no later than February 1 of the year following the year in which the income was realised.
Social security contributions paid by the employer amount to 13% for the national insurance fund, between 1-3% for the national office for professional training, and 0.2% for the national office of employment.

Other Domestic Resources

Directorate General of Taxation

Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Tax Rate

Allowable Deductions and Tax Credits

The employee's share of the National Insurance Fund (INSS) contributions (5%) is deductible. An allowance of 2% per dependant may be deducted: however, it is limited to nine dependants.
30% of basic salary, certain transportation and legal family allowances that are part of fringe benefits are not taxable.

Special Expatriate Tax Regime

Both residents and non-residents are taxable on income sourced in the country.
Where a company hires expatriates, it has to pay an exceptional tax called Impôt Exceptionnel sur la Rémunération des Expatriés (IERE). The tax rate is 25% (12.5% for mining companies in the first ten years of activity).