Taxation of international executives
When are tax returns due? That is, what is the tax return due date?
Employees are not required to submit tax returns.
What is the tax year-end?
What are the compliance requirements for tax returns in Angola?
Residents and Non-Residents
It is always the entity that pays the income (salary, wage, or fee) that must deal with the tax administration.
The paying entity must withhold the tax and subsequently remit it to the tax administration.
Personal income tax must be paid by the end of the month following the month in which the personal income was paid.
What are the current income tax rates for residents and non-residents in Angola?
Income tax table for 2019
|Tax rate on income in bracket|
|From AOA||To AOA||Percent|
||AOA550 + 7% of the amount exceeding AOA35,000
|40,001||45,000||AOA900 + 8% of the amount exceeding AOA40,000|
|45,001||50,000||AOA1,300 + 9% of the amount exceeding AOA45,000|
|50,001||70,000||AOA1,750 + 10% of the amount exceeding AOA50,000|
|70,001||90,000||AOA3,750 + 11% of the amount exceeding AOA70,000|
|90,001||110,000||AOA5,950 + 12% of the amount exceeding AOA90,000|
|110,001||140,000||AOA8,350 + 13% of the amount exceeding AOA110,000|
|140,001||170,000||AON12,250 + 14% of the amount exceeding AOA140,000|
|170,001||200,000||AOA16,450 + 15% of the amount exceeding AOA170,000|
|200,001||230,000||AOA20,950 + 16% of the amount exceeding AOA200,000|
|230,001||Above||AOA25,750 + 17% of the amount exceeding AOA230,000|
Note: 1.00 US dollar (USD) = AOA308.31
Employees are subject to personal income tax at these rates in respect of their total remuneration.
The 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).
Any entity making payments to an independent professional (including directors and members of the board or of other statutory bodies) is required to withhold personal income tax at a flat rate of 15 percent. The taxable income corresponds to 70 percent 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.
For the purposes of taxation, how is an individual defined as a resident of Angola?
In Angola the only criterion for the applicability of personal income tax is the source of the income. As mentioned earlier, only income earned in Angola attracts personal income tax. Residency is therefore irrelevant.
It should be noted that, in the event that an employee of a foreign entity renders services in Angola for a period of time exceeding 90 days, this may create a permanent establishment of the foreign entity in Angola. As a result, said foreign entity will be subject to all Angolan taxation.
Is there, a de minimus number of days rule when it comes to residency start and end date? For example, a taxpayer can’t come back to the host country/territory for more than 10 days after their assignment is over and they repatriate.
There is no de minimus number of days rule in Angola.
What if the assignee enters the country/territory before their assignment begins?
This does not make a difference as there is no de minimus number of days rule.
Are there any tax compliance requirements when leaving Angola?
Not applicable in Angola.
What if the assignee comes back for a trip after residency has terminated?
Not applicable in Angola.
Do the immigration authorities in Angola provide information to the local taxation authorities regarding when a person enters or leaves Angola?
Currently this is not happening. This could change any time if the authorities gain the capacity to do so.
Will an assignee have a filing requirement in the host country/territory after they leave the country/territory and repatriate?
Not applicable in Angola.
Do the taxation authorities in Angola adopt the economic employer approach to interpreting Article 15 of the Organisation for Economic Co-operation and Development (OECD) treaty? If no, are the taxation authorities in Angola considering the adoption of this interpretation of economic employer in the future?
Are there a de minimus number of days before the local taxation authorities will apply the economic employer approach? If yes, what is the de minimus number of days?
Not applicable in Angola.
What categories are subject to income tax in general situations?
As a general rule, all types of compensation and benefits received by an individual for services rendered constitute taxable income subject to personal income tax including, but not limited, to the following:
Intra-group statutory directors
Will a non-resident of Angola who, as part of their employment within a group company, is also appointed as a statutory director (i.e., member of the Board of Directors in a group company situated in Angola trigger a personal tax liability in Angola, even though no separate director's fee/remuneration is paid for their duties as a board member?
In case any part of their remuneration is paid/borne by an Angolan entity, taxation should arise in Angola.
a) Will the taxation be triggered irrespective of whether or not the board member is physically present at the board meetings in Angola?
b) Will the answer be different if the cost directly or indirectly is charged to/allocated to the company situated in Angola (i.e., as a general management fee where the duties rendered as a board member is included)?
Yes, in that case taxation in Angola should arise.
c) In the case that a tax liability is triggered, how will the taxable income be determined?"
The taxable income should correspond to the total income paid/recharge to the Angolan entity.
Are there any areas of income that are exempt from taxation in Angola? If so, please provide a general definition of these areas.
The following items are expressively excluded from tax:
Are there any concessions made for expatriates in Angola?
There are no specific concessions for expatriates.
Is salary earned from working abroad taxed in Angola? If so, how?
Income earned from working abroad is not subject to tax, unless it is paid or borne by the Angolan company.
Are investment income and capital gains taxed in Angola? If so, how?
Capital gains earned by an individual are not subject to taxation on personal income tax.
Dividends, Interest, and Rental Income
Dividends, interest and rental income earned by an individual are not subject to taxation on personal income tax.
Gains from Stock Option Exercises
The Angolan employment income tax code does not provide any specific criteria to calculate the related income neither when the taxable event takes place.
Nevertheless, under the applicable rules, compensation and benefits paid in cash or in kind by the employer to the employees are deemed as taxable income and it is the employer’s requirement to withhold the tax due and pay it to the tax authorities. In addition, please note that the benefits in kind should be computed by its cost for the employer entity.
That said, the income derived from stock options should be considered as taxable employment income subject to withholding provide that the related cost is recharged the Angolan entity.
Foreign Exchange Gains and Losses
Income is taxed at the conversion rate ruling at the date of payment of the salary.
Principal Residence Gains and Losses
Personal Use Items
Not considered for deduction. Taxable as a benefit if paid by employer.
Are there additional capital gains tax (CGT) issues in Angola? If so, please discuss?
Are there capital gains tax exceptions in Angola? If so, please discuss?
Deemed Disposal and Acquisition
What are the general deductions from income allowed in Angola?
Social security contributions.
What are the tax reimbursement methods generally used by employers in Angola?
How are estimates/prepayments/withholding of tax handled in Angola? For example, Pay-As-You-Earn (PAYE), Pay-As-You-Go (PAYG), and so on.
This withholding is final.
Pay-As-You-Go (PAYG) Withholding
When are estimates/prepayments/withholding of tax due in Angola? For example, monthly, annually, both, and so on.
Is there any Relief for Foreign Taxes in Angola? For example, a foreign tax credit (FTC) system, double taxation treaties, and so on.
Angola does not have any double taxation treaties with any country/territory. No foreign credit system exists as the PAYE system is final.
What are the general tax credits that may be claimed in Angola? Please list below.
This calculation assumes a married taxpayer resident in Angola with two children whose 3-year assignment begins 1 January 2017 and ends 31 December 2019. The taxpayer’s base salary is USD100,000 and the calculation covers 3 years.
|2017 USD||2018 USD||2019 USD|
|Moving expense reimbursement||20,000||0||20,000|
|Interest income from non-local sources||6,000||6,000||6,000|
Exchange rate used for calculation: USD1.00 = AOA308.31 (this same rate was used for the calculation for of the years 2017, 2018 and 2019).
|Days in Angola during year
|Earned income subject to income tax|
|Net housing allowance||3.699.725,76||3.699.725,76||3.699.725,76|
|Moving expense reimbursement||0||0||0|
|Total earned income||46.554.882,52||48.096.434,92||46.554.882,52|
|Total taxable income||45.629.951,08||47.171.503,48||45.629.951,08|
|2017 AOA||2018 AOA||2019 AOA|
|Taxable income as above||45.629.951,08||47.171.503,48||45.629.951,08|
|Angolan tax thereon||7.743.741,68||8.005.805,59||7.743.741,68|
|Domestic tax rebates (dependant spouse rebate)||0||0||0|
|Foreign tax credits||0||0||0|
|Total Angolan tax||7.743.741,68||8.005.805,59||7.743.741,68|