Accounting and tax
- The standard corporate tax rate in the DRC is 35%. Mining companies are, however, subject to a reduced corporate tax rate of 30%;
- Capital gains are included in the taxable income and are hence taxed at the corporate income tax rate;
- The standard VAT rate of 16% is levied on imports and supply of goods/services in DRC;
- All dividends, royalties and interest payments are subject to a withholding tax rate of 20%. However, distributions to local mining companies and their subcontractors are subject to a reduced withholding tax rate of 10%;
- Payment for professional services performed and rendered by non-resident companies in DRC is subject to a withholding tax rate of 14%, if the period of the said service does not exceed 6 months;
- Transfer of a building property or piece of land is subject to a stamp duty at the rate of 3% applicable on the total value of the property.
- Corporate tax returns must be filed before the 30th of April; failure to do so will subject the company to a penalty of 20% for the first offence and 40% for second offence;
- In DRC, VAT returns must be filed on a monthly basis.
- An indefinite carry forward of losses is permitted in the DRC. However, it may only be offset up to 70% of the pre-tax profit in any single fiscal year;
- The Democratic Republic of Congo has signed only 2 double taxation avoidance treaties, with Belgium and South Africa.
Legal and compliance
- Our Clients can setup a DRC company with 1 director and 1 shareholder. Under DRC law, there are no residency or nationality requirements for directors and shareholders;
- In DRC, all companies are required to provide a local registered office in the country. However, there is no requirement to appoint a company secretary;
- Before company setup is approved, A DRC company must open a capital account and deposit the minimum share capital amount;
- A DRC company will be required to register for tax and social security with i) Tax Authority ii) Social Security office and iii) Ministry of Labour.
- Employers are also required to remit Social Security contributions at the rate of 9% imposed on gross monthly salaries;
- DRC law favours hiring of local workers. Consequently, percentage of foreigners in a local company may not exceed 15% of the total work force;
- All employers must provide their employees fixed term contracts (up to 2 years) or open-ended contracts. All non-written contracts are assumed to be open ended;
- Employers may hire new employees on probation. However, the probationary period may not exceed 6 months;
- For night duty, employees will be paid 1.25 times the normal hourly wage. For overtime, they will be 1.375 times the normal hourly wage;
- DRC law bans all employees from discriminating on the grounds of sex, gender, caste, creed, colour and religion.