Taxation

Corporate income tax

• The tax year follows the calendar year. Annual tax returns must be sent by the last working day of May (except if the company does not follow the calendar year).
• The standard CIT rate is currently set at 32%. A 35% rate applies in case of undocumented expenses.
• Companies can carry forward losses for a period of 5 years.
• As for non-resident entities, the taxation of income from Mozambique is made through a 20% withholding tax (source: APIEX).

Withholding taxes (WHT)

Note: last update: 2019. Main sources: KPMG, PWC

• Organizations that do not have their head office or place of effective management in Mozambique are subject to a 10% definitive withholding tax on the following services

Source: APIEX, last update: 2019

Oil and mining taxation

• Firms carrying out petroleum or mining operations in Mozambique under a concession agreement are subject to general taxation rules and to the special taxes displayed below

• Special rules are applicable to determine the taxable income for the corporate income taxation.

Value added tax

• Value added tax (VAT) is a tax ultimately borne by the final consumer.
• It is levied on the supply of goods or services carried out in the national territory by a taxpayer and on the importation of goods.
• The tax liability is determined by the difference, in a given period, between VAT on sales (output VAT) and VAT on purchases (input VAT).
• Firms engaged in specific business activities (including finance, insurance, leasing) cannot recover VAT.
• Mozambique’s (unique) VAT rate is 17%.
• Some transactions are VAT exempt under certain conditions and limits, including the following:

Customs duties

• Goods imported in Mozambique are subject to customs tariffs. The rates vary as follows:

Note: last update: April, 2019. Source: APIEX

Excise tax

• The consumption of some (imported or locally produced) commodities is subject to a specific consumption tax (Imposto Consumo Específico).
• Examples of excise duty rates are provided below

Database source: PWC

Property Transfer Tax (SISA) or Municipal Property Transfer Tax

• Transfer of real estate, options to purchase and long-term leases is subject to a property transfer tax.
• The current rate is set at 2% (or 10% if the beneficiary lives in a tax haven country).

Stamp duty

• Stamp duties must be paid for a number of documents.

Municipal taxes

• Main municipal taxes imposed on firms are the following

Source: PWC

The Government of Mozambique has established tax treaties with a number of countries.

Treaty partners	Treaty rate					Agreement
	Dividends (%)	Interest (%)	Royalties (%)	Services (%)	Capital gains (%)
Bostwana	0/12^	10	10	10	0**
India	7.5	10	10	10	^^^
Italy	15	10	10	0^^^^	0
Macau (SAR)	10	10	10	10	0
Mauritius	8/10/15 *	8	5	0^^^^	0
Portugal	10	10	0/10 ^^	10	0 **
South Africa	8/15 ***	8	5	0 ^^^^	0 **
United Arab Emirates	0	0	5	0^^^^	0**
Vietnam	10	10	10	10	0**

Notes:
* 8% for dividend payments by a subsidiary in Mozambique (≥25% of share capitals) to its Mauritius parent company; 10% for dividend payments by a subsidiary in Mozambique (<25% of share capitals) to its Mauritius parent company; 15% in all other cases.
** Capital gains are taxed locally if shares sold are from a company for which more than 50% of its value is formed by immovable property.
*** 8% for dividend payments by a subsidiary in Mozambique (≥25% of share capitals) to its South Africa parent company; 15% in all other cases.
^ 0% for dividend payments by a subsidiary in Mozambique (≥25% of share capitals) to its Botswana parent company; 12% in all other cases.
^^ A 10% withholding tax applies to technical fees related with software assistance; 0% in all other cases.
^^^ The exemption on capital gains is extremely restricted.
^^^^ It seems that services should be considered as business profitsSources: KPMG