Namibia, Republic of

Taxable period

The tax year for companies and close corporations is aligned with the financial year.

Tax returns

The income tax return is due within seven months after the financial year-end of the company and can be extended to five months after the seventh month due date, provided that no other prior year income tax returns are outstanding.

Payment of tax

The first provisional payment for income tax is due within six months from the commencement of the company's financial year (at least 40% of tax payable at year-end is paid on first submission). The second provisional payment is due on/before the last day of the respective tax year (at least 80% of tax payable at year-end is paid on second submission). The final provisional payment is due within seven months after the financial year-end of the company.

WHT on dividends are due within 20 days after declaration of the dividend.

WHT on royalties or similar payments are due within 20 days after the end of the month during which the liability for payment of the royalty was incurred.

WHT on services is payable to the Namibian Revenue Agency within 20 days after the end of the month during which the amount was deducted or withheld.

WHT on interest is due within 20 days after the end of the month during which the interest was paid. Interest is deemed to be paid on the earlier of actual payment or when the interest becomes due and payable.

It is advised that if relief is available under the DTA, a nil form should still be submitted when payment is made to non-residents. The amount of DTA relief claimed should be disclosed on the form submitted.

No cheques are accepted as a means of payment at the Namibian Revenue Agency.

Penalties and interest

The penalties and interest due for late submissions and payments can be summarised as follows:

*  Both penalties and interest are limited to the amount of taxes outstanding.

*  Namibia has a tax amnesty program ending 31 October 2026, whereby the penalties and interest is fully waived if the outstanding taxes are settled before the end of October 2026. 

Anti-avoidance

Note that the Income Tax Act, Act 24 of 1981, contains an anti-avoidance section, Section 95, which enables the Receiver of Revenue to disregard the implications of a transaction or scheme if it can be proven that:

• such transaction or scheme had been entered into to avoid or postpone the payment of any duty or levy imposed by the Act
• such transaction or scheme was entered into or carried out by means or in a manner that would not normally be employed in the entering into or carrying out of a transaction, operation, or scheme of the nature of the transaction, operation, or scheme in question, or has created rights or obligations that would not normally be created between persons dealing at arm's length under a transaction, operation, or scheme of the nature of the transaction, operation, or scheme in question, and
• such transaction or scheme was entered into or carried out solely or mainly for the purposes of the avoidance or the postponement of liability for the payment of any tax duty or levy.

The Namibian Revenue Agency can impose Section 95 on any transaction or scheme; however, the onus will be on the Revenue Agency to prove that any/all of the requirements noted above are applicable to the transaction or scheme.

Tax audit process

The tax audit process is a discretionary process instituted by the Namibian Revenue Agency. the Namibian Revenue Agency will inspect the validity of invoices and whether such expenses are deductible for tax purposes.

Generally, income tax audits are initiated on amounts being refunded to taxpayers, with the focus being on high-value refunds.

Subsequent to an audit, a letter will be sent to the taxpayer indicating changes made to the return of income.

In the event that the taxpayer agrees with the outcome, an assessment is issued. Where the taxpayer is not satisfied with the outcome, an objection may be lodged within 90 days.

Statute of limitations

There is no statute of limitation in respect of claiming a refund for excess income tax paid. Debts to the state prescribe after 30 years.

Topics of focus for tax authority

Topics of focus for the tax authority include import VAT, general compliance, transfer pricing, payment of subsistence and travel allowances to employees, and employee taxes.