Mozambique

Changes to PIT Code 

Law No. 11/2025, of 29 December, published in the Official Gazette No. 248, introduced a set of amendments to the Personal Income Tax Code (PIT), approved by Law No. 33/2007, of 31 December, and subsequent amendments. 

Articles 21, 22, 26, 34, 48, 50, 57, 65, 65-A, and 72 have been amended. 

The following provisions of the PIT Code have been revoked: Article 30(1)(b) and (c), Article 33, Article 52(2)(b), and Articles 65(4), 73, and 74. 

Main highlights:

• Residence criteria: The tax residence criteria have been amended. The previous 180-day physical presence test has been repealed. A person is now regarded as a tax resident if they have their main residence in Mozambique, their principal professional activity is carried on there, or the center of economic interests is there, regardless of nationality or the duration of physical presence.
• Digital Economy Taxation: A 10% withholding tax (as a final tax) applies when such income is paid by Mozambican tax residents. Further regulations on this regime are expected.
• Electronic Currency Commissions: Commissions on electronic currency transactions are subject to a flat 10% withholding tax rate at source. Further regulations on this regime are expected.
• Capital Gains: Capital gains are subject to autonomous taxation at progressive rates ranging from 10% to 32%.
• Rental Income: A deduction from the gross rental income of up to 30% is available for duly documented expenses conservation and maintenance expenses, as well as interest paid to Mozambican credit institutions on loans credit for the construction of owner-occupied housing. Rental income is now subject to a flat 20% withholding tax rate. The deduction of 30% to the withholding tax rate is eliminated.
• Withholding tax on employment income: The provision deeming income tax withheld on employment income to be a final tax has been repealed (Article 65-A (6)). The exemption from filing an annual tax return (Modelo 10) for individuals who received only employment income already subject to monthly tax withholdings was also repealed (Article 52 (2) (b)).
• Elimination of Special Regimes: The simplified and exempt regimes have been abolished. Taxpayers registered under those regimes must migrate to the statutory accounting regime.

This Law entered into force on 1 January 2026. The Government must issue the respective implementing regulations within 180 days.