Congo, Democratic Republic of the

Finance Law for 2024

The Finance Law for 2024 entered into force as of 1 January 2024.

The main changes enacted are as follows:

1. Value Added Tax ( VAT)

The taxpayer is required to submit detailed lists of transactions (turnover) with the VAT return, in accordance with the models defined by the tax authorities.

2. Corporate Income Tax ( CIT)

• Procedures for subscription of the CIT by companies subject to a minimum tax (Article 37 of the LF 2024)

Payment of the minimum tax set at 1% of declared turnover is only due for one twelfth per month or fraction of a month when the taxpayer began operations after January.

• Arrangements for the payment of instalments (Article 39 of the 2024 Finance Act)

Reduction in the number of instalments (from 4 to 3) and changes in their rates and deadlines:

• 30% of the CIT base for the first two instalments:
• before 1 August for the 1st instalment and
• before 1 October for the second instalment of the year in which the taxable income is earned.
• 20% of this base is payable before 1 December of the year in which the taxable income is earned.

3. Personal Income Tax

• Exempt income (Article 34 LF 2024)

Establishment of the immunity of financial benefits accompanying official testimonials and other honours awarded to a remunerated person in the course of his or her career.

• Determination of Personal Income Tax (Art 35 of the LF 2024)

The clarification that PIT calculated after deduction of family allowances may not be less than 2,500 Congolese francs per month.

• The rate of permanent and non-permanent bonuses, snacks and other benefits paid to state employees and civil servants, as well as members of political institutions and assimilated persons (Art. 36 of the 2024 Finance Act).

 Specification of the rate at which these bonuses are subject to IPR at:

• 3% for state employees and civil servants
• 15% for members of political and similar institutions.

Finance Law for 2023

The Finance Law for 2023 entered into force as of 1 January 2023.

The main changes enacted are as follows:

Value-added tax (VAT)

• The obligation for taxable persons to issue a standardised invoice generated by electronic fiscal devices or a document in lieu thereof, the details of which will be laid down by decree, and to have their invoicing system approved.
• The obligation for taxable persons to register with the tax authorities as users of electronic fiscal devices and the possibility of being reimbursed, in the form of a credit to the IBP, for the cost of acquiring physical electronic fiscal devices.
• The obligation to deduct VAT mentioned on an invoice only if it is a standardised invoice.
• The obligation to deduct the VAT mentioned on an invoice from a foreign supplier only if it is a standardised invoice or a document in lieu thereof and if it mentions the supplier's Tax Number.
• VAT exemption for imports of banknotes and foreign currency by commercial banks.

• The introduction of a reduced rate of 8% for the sale of domestic airline tickets and an extended list of essential goods.

Corporate income tax (CIT)

• The abolition of the legal requirement to enter on the assets side of the balance sheet under ’formation expenses‘ expenses incurred in connection with activities that are essential to the existence or development of the company, but the amount of which cannot be related to the production of specific goods and services.
• The possibility for the company to deduct the amount of interest paid to partners (or shareholders) only if the sums made available to the company do not exceed, for all the aforementioned partners or shareholders, the amount of the share capital.
• Clarification that provisions set up by credit and microfinance institutions in accordance with their specific rules and by insurance and reinsurance companies are deductible only if they are certified by the auditor and not certified.
• Increase in the deduction to 100% of Internet costs, provided they are used exclusively for business purposes .
• Recognition of the deduction of justified expenses not exceeding 0.5% of turnover when these deductions relate to gifts, donations, and subsidies made to the Social Fund of the Republic, to research bodies, to philanthropic and social works or bodies of public utility, and to sports associations established in the Democratic Republic of the Congo (DRC)).

Withholding tax (WHT)

• Establishment of taxation of income from the shares of active partners in companies other than joint stock companies having their registered office and their principal place of business or their permanent or fixed establishment in the Democratic Republic of the Congo.
• Clarification that the income from the shares of active members includes interest and all profits allocated in any capacity and in any form.

Excise duties

• The exclusion of 16 goods from the application of excise duty.
• Taking into account the concept of information and communication technologies as one of the processes by which service signals subject to excise duty are transmitted or routed.
• Revision of excise duty rates for certain goods and services.
• Extension of the exemption from excise duty to certain products.
• Penalisation of the placing on the market of goods without the official tax mark, with fines ranging from 50 million to 100 million Congolese francs (CDF) by special confiscation or destruction.

Tax procedure

Information and reporting requirements 

• Banks are required to notify the tax authorities of their customers' details (natural persons and legal entities) within ten days of opening a bank account or changing those details .
• Introduction of a fine for failure to make the amended declaration of taxpayer information provided for in Article 2 of Law n°004/2003.
• The obligation for all companies to have their financial statements certified by an ONEC chartered accountant, failing which the financial statements will be rejected. 

The audit procedure

• Clarification that the tax authorities carry out a documentary audit without sending a prior notice or request for information to the taxpayer, the latter being a simple possibility.
• Clarification that the documentary audit is an audit of the consistency of the taxpayer’s declarations and not a general audit of the accounts.