Law No. 28/20, of 20 July 2020, published in the Official Gazette, amends the Employment Income Tax Code, approved by Law No. 18/14, of 22 October 201. It also revokes Law No. 9/19, of 24 April 2019, and Law No. 28/19, of 25 September 2019, both Laws having previously amended the Employment Income Tax Code. Among the several measures, we highlight the following:
- The tax base on income earned by employees of service providers is extended. Cashier’s allowances, severance payments, and the full amount of housing allowances (previously only 50% of the rental contract amount) are now subject to tax.
- The minimum threshold for taxation of employment income (Group A) increases from 35,001 to 70,001 Angolan kwanza (AOA).
- Additionally, the minimum tax rate for employment income increases from 7% to 10% (applicable from AOA 70,001) and the maximum rate increases from 17% to 25% (applicable from AOA 10,000,001), with relevant increases also in the fixed amounts of each tax bracket.
- Self-employment income of Groups B and C is subject to a withholding tax (WHT) rate of 6.5% on the amount of the service provided when paid by entities with an organised or simplified accounting model.
- The taxable income of self-employed individuals of Groups B and C not subject to WHT is liable to a 25% tax rate.
- Group B and C taxpayers with organised accounts may be subject to the provisions of the Corporate Income Tax (CIT) Code for the assessment of the taxable income. Those taxpayers are allowed to deduct 30% of the costs if they have simplified accounts or record books. In all other cases, they are not allowed to deduct any costs.
- Services acquired from non-residents, as foreseen in the CIT Code, are subject to tax at the rate of 15%.
- The list of activities taxed under Group B was extended.
- The deadlines for submitting tax returns and payments have changed from the last day of the month to the last working day of the month.
This law entered into force 30 days after its publication.