Income tax - Corporate entities
Burundi
i) Corporation tax rates
| Law no 1/02 of 24 January 2013 on direct taxes on income | Rate |
|---|---|
| Corporate tax standard rate | 30% |
| Minimal tax on turnover if taxable profits is less than turnover divided by 30 | 1% |
| Incentives to registered investors | |
| a. Profit tax discount of: | |
| If investor employs between 50 and 200 Burundians | 2% |
| If investor employs more than 200 Burundians The discount is granted to investors only if they maintain the employees for a period of at least six months during a tax period and the category of employees are not those who pay PAYE at zero percent (0%). |
5% |
| b. Any Investor in Free Trade Zone | |
| Corporate income tax during the first 10 years of establishment | 0% |
| Corporate income tax - starting from 11th year of establishment | 15% |
| Corporate income tax - if investor employs more than 100 permanent Burundian Employees | 10% |
| If investor reinvest more than 25% of profits realised during the 10 years of Existence | 10% |
| Tax on dividends | Exempted |
| All kind of Imports on the list submitted during registration | Exempted |
| All kind of Exports on the list submitted during registration | Exempted |
| c. Investor engaged in trade who operates in Free Trade Zone | |
| Turnover tax during the first 10 years of establishment | 1% |
| Turnover tax if employs more than 20 Burundian permanents jobs | 0.80% |
| Repatriation of profits | |
| Free repatriation | |
| Interests in treasury bills | |
| Interests on treasury bills | Exempted |
| Exports - Tax discount | N/A |
| Exempted activities | |
| Agriculture and livestock activities are exempted | Exempted |
| Fishery activities below 20 Million are exempted | Exempted |
| Other Taxes | |
| Security tax on imports | 1.15% |
ii) Capital deductions
| Capital deductions - Tax Depreciation | Rate |
|---|---|
| Buildings at Cost (each asset is depreciated individually) | 5% |
| Heavy machinery, boats, ships, airplanes at Cost (each asset is depreciated individually) | 10% |
| Intangible assets including goodwill at Cost (each asset is depreciated individually) | 10% |
| Computers and accessories, information and communication systems, software products and data equipment (under a pooling system and on declining balance) | 50% |
| All other business assets (under a pooling system and on declining balance) | 25% |
| Cost: This is defined to include cost of acquisition, the cost of improvement or construction and the cost of refining, rehabilitation, reconstruction development. | |
| Investment allowance | N/A |
Kenya
i) Corporation tax rates
| Description | Rate |
|---|---|
| Resident corporation | 30% |
| Non-resident corporation | 37.5% |
| Export Processing Zone: | |
| i) first 10 years | Nil |
| ii) next 10 years | 25% |
| Registered Unit Trusts / Collective Investment schemes | Exempt subject to conditions |
| Newly listed companies approved under the Capital Markets Act: | |
| With 20% issued shares listed. For the first 3 years after listing | 27% |
| With 30% issued shares listed. For the first 5 years after listing | 25% |
| With 40% issued shares listed. For the first 5 years after listing | 20% |
| Special rates on gross income of non-residents derived in Kenya: | |
| Transmission of messages | 5% |
| Ownership or operation of a ship | 2.5% |
ii) Capital deductions (writing down allowances)
| Capital deductions | Rate |
|---|---|
| Investment deduction: | |
| Qualifying investment exceeding Kshs 200 million (outside Nairobi, or the Municipalities of Mombasa or Kisumu) | 150% |
| Other qualifying investment | 100% |
| Industrial building allowance: | |
| Hostels and certified education buildings (straight line) | 50% |
| Qualifying rental residential or commercial buildings (straight line) | 25% |
| Other qualifying buildings (including hotels, straight line) | 10% |
| Wear and tear allowance: | |
| Plant and machinery (reducing balance) | |
| Class 1 (Heavy earth moving equipment, tractors and combine harvesters) | 37.5% |
| Class 2 (Other self-propelling motor vehicles) | 30% |
| Class 3 (computers and peripheral computer hardware) | 25% |
| Class 4 (All other equipment including furniture) | 12.5% |
| Telecommunication equipment (straight line) | 20% |
| Other allowances: | |
| Computer software (straight line) | 20% |
| Capital expenditure under a concession airing arrangement | Equal proportions over the period of concession |
| Mining specified minerals; Year one | 40% |
| Mining specified minerals; Year two to seven | 10% |
| Farm works (straight line) | 100% |
Rwanda
i) Corporation tax rates
| Description | Rate |
|---|---|
| The general corporate tax rate for resident companies | 30% |
| However, a registered investment entity that operates in a Free Trade Zone and foreign companies with headquarters in Rwanda who fulfil the requirements stipulated in the Investment code of Rwanda is entitled to the following preferential tax rates: | |
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0% |
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| Companies that carry out micro finance activities pay corporate income tax for a period of five years. The period is renewable by the order of the minister. | 0% |
| A registered investor is entitled to a profit tax discount of: | |
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| The discount is granted to investors only if they maintain the employees for a period of at least six months during a tax period and the category of employees are not those who pay PAYE at zero percent (0%) | |
| Newly listed companies | |
| Newly listed companies on capital market shall be taxed for a period of 5 years on the following rates: | |
| i. if those companies they sell at least 40% of their shares to the public; | 20% |
| ii. if those companies sell at least 30% of their shares to the public; | 25% |
| iii. if those companies sell at least 20% of their shares to the public. | 28% |
| Venture capital companies registered with the Capital Markets Authority in Rwanda benefit from a corporate income tax of zero percent (0%) for a period of five (5) years from the date the decision has been taken. | |
| Exports-Tax discount | |
| Export of commodities and services that bring to the county revenue of: | |
| Between US$ 3m and US$ 5m qualify for a tax discount of | 3% |
| More than US$ 5m qualify for a tax discount of | 5% |
| A new tax regime for SMEs in the form of a flat tax rate has been introduced. The new SME tax regime groups SMEs in two categories with the following tax rates: | |
| 1. SMEs with turnover of 12 million to Rwf 50 Million, now pay a flat tax rate of | 3% |
| 2. Micro enterprises with turnover of Rwf 12 million or less are now grouped into four bands with tax amounts payable as follows: | |
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| 3. Taxpayers with annual turnover equal to Rwf 200 Million can opt to declare and pay PAYE on a quarterly basis | |
ii) Capital deductions
| Capital deductions | Rate |
|---|---|
| Buildings, plant and equipment (each asset on its own on a straight line basis) | 5% |
| Intangible assets including goodwill (each asset on its own on a straight line) | 10% |
| Computers and accessories, information and communication systems, software products and data equipment (under a pooling system on straight line basis) | 50% |
| All other business assets (under a pooling system on straight line basis) | 25% |
| Investment allowance | |
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40% |
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50% |
United Republic of Tanzania
i) Corporation tax rates
| Description | Rate |
|---|---|
| Resident corporation | 30% |
| Non-resident corporation | 30% |
| Newly listed companies - reduced rate for 3 years | 25% |
| Alternative minimum tax | 0.3% |
ii) Capital deductions
| Capital deductions | Rate |
|---|---|
| Buildings (straight line) | |
| Used in Agriculture or livestock / fish farming | 20% |
| Other | 5% |
| Plant and machinery (initial allowance) | |
| Used in Manufacturing (first year allowance) | 50% |
| Used in Agriculture | 100% |
| Plant & machinery (reducing balance) | |
| Class 1 | 37.5% |
| Class 2 | 25% |
| Class 3 | 12.5% |
| Intangible assets (straight line) Over useful life | |
| Agriculture - improvements / research and development | 100% |
| Mining exploration and development | 100% |
| Equipment used for prospecting and exploration of minerals or petroleum | 100% |
Uganda
i) Corporation tax rates
| Description | Rate |
|---|---|
| Resident corporation | 30% |
| Non-resident corporation | 30% |
| Repatriated income of a branch | 15% |
| Collective Investment Schemes | Exempt |
| Non-resident shipping, air and road transport operators and embarking goods in Uganda | 2% |
| Direct-to-home pay television services and internet broadcasting | 5% |
| Operation of aircraft in domestic and international traffic or leasing of aircraft | Exempt |
| Presumptive tax is the final tax for the taxpayer | Gross Turnover Rates |
| Less than UShs 5 million | Nil |
| Between UShs 5 million and UShs 20 million | UShs 100,000 |
ii) Capital deductions
| Capital deductions | Rate |
|---|---|
| Industrial Buildings / Hotels / Hospitals: | |
| Initial allowance | 20% |
| Annual write-down allowance (straight line) | 5% |
| Plant and machinery (Initial allowance): | |
| Entebbe, Jinja, Kampala, Namanve, Njeru (the allowances are lower in these areas to decentralise) | 50% |
| Other areas | 75& |
| Plant, machinery and vehicles (annual allowance, on reducing balance): | |
| Year 1 | 20% |
| Year 2 | 30% |
| Year 3 | 35% |
| Year 4 | 40% |
| Commercial Buildings (Annual allowance on straight basis) | 5% |
| Mining companies are charged at income tax rates ranging from 25% to 45% depending on company’s ratio of chargeable income to gross revenue in the year of income. | 25% to 45% |
| Between UShs 20 million and UShs 30 million | Lower of UShs 250,000 or 1% of gross turnover |
| Between UShs 30 million and UShs 40 million | Lower of UShs 350,000 or 1% of gross turnover |
| Between UShs 40 million and UShs 50 million | Lower of UShs 450,000 or 1% of gross turnover |