Togo: Business Environment

Accounting Rules

Tax Year: The tax year is the calendar year.
Accounting Standards: The Organization for the Harmonization of Business Law in Africa released a Uniform Act on Accounting and Financial Information (AUDCIF), which came into effect on January 1, 2018 for individual accounts and on January 1, 2019 for consolidated accounts, combined accounts, and financial statements prepared in accordance with IFRS.
As of 1 January 2019, IFRS Standards are required for all listed companies and companies making a public call for capital. Small and medium enterprises are required to follow either the SYSCOHADA system or IFRS standards.
Accounting Regulation Bodies: Organisation for the Harmonisation of Business Law in Africa (OHADA)
West African Economic and Monetary Union (UEMOA)
Ordre National des Experts-Comptables et Comptables Agréés du Togo (ONECCA)
Accounting Reports: According to art. 8 of the Accounting Act of the Organisation for the Harmonisation of Business Law in Africa, companies must publish a balance sheet, a profit and loss account, a statement of cash flows and notes to the financial statements.
All listed companies and companies making a public call for capital must use IFRS standards for their financial statements.
Publication Requirements: Public limited companies must submit audited financial statement every year. Limited liability companies must appoint an auditor in one of the following cases: capital of more than XOF 10 million; more than 50 employees; or a turnover of XOF 250 million or more.
Professional Accountancy Bodies: Ordre National des Experts-Comptables et Comptables Agréés du Togo (ONECCA)
Certification and Auditing: According to art. 376 of the Uniform Act on Commercial Companies of the Organisation for the Harmonization of Corporate Law in Africa (OHADA), private limited companies are required to appoint at least one auditor if their capital exceeds XOF 10 million and they meet, at the end of the fiscal year, one of following conditions: the annual turnover is greater than XOF 250 million; or the number of permanent staff exceeds fifty people. For private limited companies that do not meet these criteria, the appointment of an auditor is optional. Nevertheless, such an appointment maybe requested in court by one or more members holding at least one-tenth of the stated capital.
In public limited companies, supervision is exercised by one or more auditors.
Accounting News

Tax Rates

Consumption Taxes

Nature of the Tax: Value Added Tax (VAT) - Taxe sur la Valeur Ajoutée (Local name)
Tax Rate: 18% (standard rate)
Reduced Tax Rate: Financial, insurance, medical and transport services are exempt from VAT. Additional categories of exempt supplies include agriculture, fishing and livestock, and supplies relating to the importation, production and sale of products and equipment used in the fight against the COVID-19 pandemic.
A 10% reduced rate applies on accommodation, catering and other services provided by hotels, restaurants and related registered organisations, as well as on services performed by licensed tour operators.
Other Consumption Taxes: Excise duties are levied on tobacco (50%), coffee and tea (10%), soft drinks (5%, excluding water), wheat flour (1%), oils and fats (1%), perfumery and cosmetic products (15%), beer (18%) and other spirits (50%).
A tax on fuel consumption is levied at rates ranging from XOF 0 to XOF 60 per litre, depending on the type of fuel.

Corporate Taxes

Company Tax: 27%
Tax Rate For Foreign Companies: All companies registered in Togo must pay tax on Togo-source; whereas non-resident companies are subject to tax on Togo-source income. However, there is no actual legal definition of residence.
Non-resident companies without a branch or permanent establishment in Togo are subject to a final 20% withholding tax on Togo-source income.
Capital Gains Taxation: There is no specific tax on capital gains in Togo, as capital gains realised by corporations on the sale of assets or real estate are treated as taxable income (some exemptions and reliefs may apply). Both residents and non-residents are subject to capital gains tax on direct or indirect transfers of real property, gains from the transfer of share and mining permits, and licenses issued by the government. The tax rates are 7% for gains from the transfer of property or property rights and share transfers and 15% for mining permits or license transfers.
Main Allowable Deductions and Tax Credits: In general, expenses and costs incurred for the purpose of operating the business are tax-deductible, including rents, personnel and labour costs, direct and indirect remuneration paid in respect of work, interest paid to shareholders, technical assistance fees and costs of research paid by a Togolese company or a permanent establishment of a foreign company in Togo, royalties, management fees. Depreciation and amortisation deductions are available, calculated on the basis of the normal wear and tear of the assets used in business activities.
Technical assistance fees deduction is limited to 20% of the taxable profit for the current fiscal year.
Losses incurred during a financial year are deductible up to 50% of the taxable profit of a subsequent year, the remaining part can be carried forward indefinitely. The carryback of losses is not allowed.
Other Corporate Taxes: Other taxes for companies include: a 3% payroll tax on gross salaries, social security contributions (17.5% of the employee's salary is paid by the employer, 4% is paid by the employee), a 15% property tax on the rental value of the real estate, stamp duties, a registration duty of 2% per contribution of capital, a XOF 35,000 registration duty on the transfer of immovable property.
Other Domestic Resources: Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Country Comparison For Corporate Taxation

	Togo	Sub-Saharan Africa	United States	Germany
Number of Payments of Taxes per Year	49.0	36.6	10.6	9.0
Time Taken For Administrative Formalities (Hours)	159.0	284.8	175.0	218.0
Total Share of Taxes (% of Profit)	48.2	47.3	36.6	48.8

Source: Doing Business - Latest available data.

Individual Taxes

Tax Rate

Personal income tax	Progressive rates from 0% to 35%
From XOF 0 to XOF 900,000	0.5%
From XOF 900,001 to XOF 4,000,000	7%
From XOF 4,000,001 to XOF 6,000,000	15%
From XOF 6,000,001 to XOF 10,000,000	25%
From XOF 10,000,001 to XOF 15,000,000	30%
Above XOF 15,000,000	35%
Minimum tax	XOF 3,000
Industrial and commercial profits, non-commercial profits, and agricultural profits	30%

Allowable Deductions and Tax Credits: A deduction of a percentage of net wages is allowed to cover contributions for public health insurance, social security and certain other deductions.
Interest on loans for the acquisition of a building or for building repairs in Togo is deductible for the first 10 years of the loan. Gifts, donations and subsidies are deductible (capped at 1% of taxable income).
Deductions are allowable for dependent relatives (XOF 10,000 per month per dependent) and for certain expenses relating to real property.
Individuals earning industrial and commercial profits, non-commercial profits, or agricultural profits may deduct expenses incurred in earning such profits.
Special Expatriate Tax Regime: Residents are taxed on their worldwide income, while non-residents are taxed on their Togo-source income.
Foreigners are taxed as residents if they have spent at least six months in Togo and have a tax domicile in the country.
Both residents and non-residents are subject to capital gains tax on direct or indirect transfers of real property, gains from the transfer of share and mining permits, and licenses issued by the government. The tax rates are 7% for gains from the transfer of property or property rights and share transfers and 15% for mining permits or license transfers.

Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed: Double taxation agreement between Togo and France
Withholding Taxes: Dividends: 0 (paid by a resident subsidiary to its resident parent company)/7% (if the payer company is a listed company within the WAEMU)/13%; Interests: 0% (long-term government bonds)/3% (medium-term government bonds)/6% (standard rate for companies)/13% (individuals); Royalties: 5% (resident with tax number)/10% (resident without tax number)/20% (non-resident).

Sources of Fiscal Information

Tax Authorities: Overview of Togo's tax measures in response to Covid-19
Togo Revenue Authority
Other Domestic Resources: Togo Revenue Authority - Tax guide
Togo Invest

Intellectual Property

National Organisations: Find the contact information of the National Institute of Industrial Property and Technology (INPIT) on this page.
Regional Organisations: Togo is a member of WIPO and of the African Intellectual Property Organization (OAPI)

Legal Framework

Independence of Justice: Although the Togolese constitution provides for an independent judiciary, in practice it is reported to be heavily influenced by the presidency. According to Freedom House, executive influence and judicial corruption limit constitutional rights to a fair trial (as shown in the case of the 2017 anti-government protest, when more than two dozen people were charged, tried, and convicted within two days of their initial arrest. Corruption and inefficiency are widespread among the police, and there are also reports of arbitrary arrest. Furthermore, prisons suffer from overcrowding and inadequate food and medical care.
Checking National Laws Online: Library of the Congress
Droit Afrique - Togo

Standards

National Standards Organisations: Togolese Agency for Normalisation (Agence Togolaise de Normalisation - ATN)
Integration in the International Standards Network: Togo is a member of African Organisation for Standardisation (ARSO).
The Togolese Agency for Normalisation is a correspondent member of ISO.
Classification of Standards: TGO
Certification Organisations: Togolese Agency for Normalisation (Agence Togolaise de Normalisation - ATN)

Business Practices

General Information
Opening Hours and Days: Shops: 7.30am to 12.30pm and 2.30pm to 6pm, Monday to Saturday.
Administrative Offices: 7am to noon and 2.30pm to 5.30pm, Monday to Friday.
Banks: 7.45am to 4pm or 5pm, Monday to Friday (some banks are also open on Saturdays).

Public Holidays

New Year's Day	1 Jan
Easter Monday	22 Apr
Independence Day	27 Apr
Labour Day	1 May
Ascension Day	30 May
Korité	4 Jun
Whit Monday	10 Jun
Martyrs' Day	21 Jun
Tabaski	11 Aug
Assumption Day	15 Aug
All Saints' Day	01 Nov
Christmas Day	25 Dec

Holiday Compensation: The law does not provide for a compensation day in case a holiday falls on a non-working day. However, if a person has to work during a holiday, he/she is generally entitled to a 65% increase of the normal pay (Art. 32 of the Collective Inter-Professional Convention of 2011).

Periods When Companies Usually Close

Closure for Easter	End of March/Early April
Closure for Christmas	End of December

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