Namibia, Republic of

Individual - Tax administration

Last reviewed - 13 December 2019

Taxable period

The tax year of assessments for natural persons runs from 1 March to 28 February.

Tax returns

Namibia has a system of self-assessment, which must include a computation of the taxpayer's taxable income and tax payable, and the payment of tax due on the income so computed.

Husbands and wives submit separate tax returns and are taxed separately.

The income tax return for salaried individuals is due on 30 June and for farmers and business individuals on 30 September.

Payment of tax

Employee’s tax

Pay-as-you-earn (PAYE) tax is withheld from an employee's salary by the employer and must be remitted to the revenue authorities by the 20th day of the month following the payroll deductions. Any individual who earns income in excess of NAD 5,000 that is not subject to PAYE (e.g. interest or profit from trade) is required to register as a provisional taxpayer.

Provisional tax

The first provisional payment for provisional taxpayers is due on/before 30 August (at least 40% of tax payable at year-end is payable with the submission of the first provisional tax return).

The second provisional payment is due on/before 28 February (the first and second provisional payments should amount to at least 80% of tax payable at year-end).

Top-up payment

The final provisional payment is due on 30 June for salaried individuals and 30 September for business and farming individuals.

Withholding tax (WHT)

WHT on dividends is due within 20 days following the month in which the dividend was declared.

WHT on royalties is due 20 days after the end of the month during which the said liability is incurred or the said payment is made.

WHT on services is payable to the Receiver of Revenue within 20 days after the end of the month during which the amount was deducted or withheld. It is advised for WHT on services that even if relief is available under a 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.

Penalties and interest

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

Tax area Reason Penalty* Interest*
1st provisional tax Late submission NAD 100 per day penalty for outstanding provisional tax returns None
Late payment 10% per month* 20% per annum
Under-estimation 100% of the underestimated amount None
2nd provisional tax Late submission NAD 100 per day penalty for outstanding provisional tax returns None
Late payment 10 per month* 20% per annum
Under-estimation 100% of the underestimated amount None
Income tax return Late submission NAD 300 may be levied None
Late payment 10% one-off 20% per annum**
Omission/incorrect statement Up to 200% None
WHT Late submission None None
Late payment 10% 20%

*  Penalties are levied at 10% per month. Interest is levied at 20% per annum. Both penalties and interest are limited to the amount of taxes outstanding/underpaid.

 ** Applicable when the return was submitted on time but when the payment was late.

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 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 Receiver of Revenue can, at its sole discretion, impose Section 95 on any transaction or scheme, which will place the onus on the taxpayer to prove that any/all of the requirements noted above will not be applicable to the transaction or scheme.