The tax year follows the calendar year.
The annual CIT return for companies under general and simplified regime must be submitted by the last business day of May and April, respectively, following the year to which the income relates.
Payment of tax
Taxpayers under the general regime that record sales and services excluded from WHT are required to make advance CIT payments by the end of August.
This tax is calculated by applying the rate of 2% to the total amount of sales and services excluded from the application of CIT WHT recorded by the taxpayers in the first half of the tax year. Advance payments may be offset against final CIT assessed.
The taxpayers may assess the 2% provisional payments of CIT due on sales based on the actual amounts received (rather than the turnover), but, in such cases, they are required to deliver the bank statements to the tax authorities.
Taxpayers with tax losses in the previous year may be exempt from the 2% provisional payments of CIT on sales.
The taxpayers that replace their suppliers in the issuance of invoices (considering the self-invoicing regime defined in law) should, in the moment of payment to the supplier for the provision of goods, withhold 2%.
The final tax must be settled by the last business day of the month of April (simplified regime) and May (general regime) of the following year.
Tax audit process
The tax authorities may carry out tax audits to the monthly and annual tax returns.
Taxpayers may challenge any decision and file an appeal to the Chief of the respective Tax Office within 30 days upon receiving the tax notification.
Based on an unsatisfactory decision of the Chief of the Tax Office, the taxpayer may also file a hierarchical appeal addressed to the President of the Tax Authorities Executive Board (AGT) within 30 days upon receiving the tax notification.
The taxpayer still has the right to appeal against the final decision of the AGT in court within 60 days upon receiving the final decision from the tax authorities.
Statute of limitations
The statute of limitations in Angola is five years. The statute can be extended to ten years if the delay in settlement has the result of a tax crime.
Topics of focus for tax authorities
The tax authorities' main areas of focus are related to:
- WHTs due (regarding several taxes: CIT, PT, IIT, and PIT).
- 1% stamp tax on receipts (partially revoked as of October 2019).
- Deductibility of costs for CIT purposes (foreign exchange differences, provisions, donations, exemptions relating to tax benefits areas).
- Consumption tax on production and on services provided by foreign entities (revoked as of October 2019).
- Transfer pricing.
Legal regime on invoices and similar documents
Invoices or similar documents must comply with the legal regime of invoices and similar documents (governed by the Presidential Decree 292/18).
Invoices and similar documents must comply with the following requirements (amongst others):
- Include the name, firm, tax address, and tax number of the supplier.
- Be duly dated, sequentially numbered.
- Include details on the nature, quantity, and price of the goods and services, as well as the taxes due.
- Be written in Portuguese and expressly mention that they were computer processed.
The legal regime of invoices and similar documents also established the following rules:
- The existence of a monthly generic invoice for banking institutions.
- Issuance of invoices in triplicate, being the triplicate used to accompany the transport of goods.
- Obligation to issue invoices in a programme certified by the tax authorities, applicable to taxpayers with a turnover above AOA 50,000,000.
Suppliers that do not comply with this regime are subject to fines and penalties. In addition, the acquiring entities cannot deduct the cost for CIT purposes and will be subject to an autonomous taxation on an amount that varies depending on the extent of the failure.
Additionally, from a VAT perspective, the VAT assessed in invoices that do not comply with the foreseen in the Law is not deductible and shall be registered as a cost.
We highlight that a Self- billing Legal Regime was approved by Presidential Decree nr. 194/20 of July 24th, 2020.
This regime entered into force on August 23rd, 2020 and will be in force until 31 December 2022.
The same is applicable to entities with tax residency in Angola which have organised accounting and who, in the exercise of economic activities, acquire goods and services from individual suppliers, who are not able to issue invoices.
The invoices/receipts issued must contain, in addition to the requirements foreseen on the Legal Regime of Invoices and Equivalents Documents, the mention “self-billing”, as well as the information referred to the Self-Billing Legal Regime.
This regime has specific rules such as:
- The invoices/receipts issued shall not exceed 20% of the total cost of goods sold and materials consumed and the cost of supplies and services from third parties of the issuer.
- When the products acquired in the sectors provided are exclusively for the realization of the acquiring entity main activity, the costs resulting from self-billing can be considered in 60%.
- In the acquisition of goods, the acquiring entities must withhold Corporate Income Tax at a rate of 2%.
- In the acquisition of services, the acquiring entities must withhold Personal Income Tax at a rate of 6.5%.
Legal framework on electronic processing and recording of tax procedures
Presidential Decree no. 232/19, of 22 July, was published in the Official Gazette. It approves the new Legal Framework on the Electronic Processing and Recording of Tax Procedures, repealing Decree no. 363/17, of 26 July.
This regime sets out new rules applicable to electronic notifications and other communications of tax procedures.
This regime is mandatory to:
- taxpayers registered in the Department of Large Taxpayers
- taxpayers with a turnover, or a volume of import of goods, higher than AOA 50 million, and
- tax representatives of non-resident entities from the time of delivery of the declaration with the respective appointment.
These taxpayers must update their registration within 30 days after the entry into force of this Decree.
It becomes the taxpayer's responsibility to access periodically the taxpayer Portal and to consult the tax acts of which it is addressee. The taxpayer is considered as being notified when one consults the Portal or 10 days after the tax act is made available on the taxpayer’s Portal.
Taxpayers subject to this regime are required to file by electronic means tax statements, including maps and forms as well as all supporting documents, within the deadlines stipulated in the applicable law.