Mozambique legal and accounting and tax considerations in 2024

• Corporate tax regime

  1. Corporate tax in Mozambique is imposed at a standard rate of 32%. All legal entities must register for tax with the Mozambique Tax Authority and file annual returns by the 31^st of May following the end of the tax year;
  2. Capital gains in Mozambique is regarded as ordinary income and is taxed at the normal corporate tax rate of 32%;
  3. The Value Added Tax (VAT) is levied at a standard rate of 17%. Certain corporate services including banking, health and education are however exempted from VAT. Companies must register for VAT and submit monthly returns;
  4. Other taxes in Mozambique include i) real property tax of 0.4% for residences and 0.7% for offices ii) 0.4% stamp duty applicable of the transfer of shares iii) 2% real property transfer tax;

• Withholding tax and tax treaties

  1. A 20% withholding tax is applicable on i) dividends ii) interests and iii) royalties paid to both resident and non-resident companies. The rate may however be reduced for non-resident companies where a tax treaty is applicable;
  2. A 20% withholding tax is applicable on technical services fees paid to non-resident company unless reduced where a tax treaty applies;
  3. A 10% withholding tax is applicable to payments made to non-resident companies for services including i) construction ii) transport and telecommunication iii) electricity distribution;
  4. Employers in Mozambique must submit a monthly social security contribution of 4% of their employees’ gross salary to the National Institute of Social Security (INSS);
  5. The Republic of Mozambique is signatory to 9 double tax treaties with different countries including South Africa, Portugal, United Arab Emirates, among others;

• Miscellaneous tax information

  1. Business tax losses in Mozambique can be carried forward for up to 5 years. Carryback of losses is however not allowed;
  2. Healy Consultants Group will assist the Client with i) documenting and implementing accounting procedures ii) implementing financial accounting software iii) preparing financial accounting records and iv) preparing forecasts, budgets and performing sensitivity analysis;
  3. It is important our Clients’ are aware of their personal and corporate tax obligations in their country of residence and domicile; and they will fulfill those obligations annually. Let us know if you need Healy Consultants’ help to clarify your annual reporting obligations.