Benin legal and accounting and tax considerations in 2024

1. Corporate tax in Benin is imposed at a standard rate of 30%. However, companies in the industrial sector are subject to a lower rate of 25%. All legal entities must register for tax with the General Tax Office and file annual returns within 4 months following the end of the fiscal year;
2. A varying corporate tax rate of between 35% – 45% is applicable to all companies engaged in i) oil research and exploration ii) the production and sale of hydrocarbons;
3. The Value Added Tax (VAT) is levied at a standard rate of 18%. Companies must register for VAT and file returns by 10^th of the following month. Banking institutions and insurance companies are exempted from VAT;
4. Companies in the industrial sector may enjoy exemption from income tax for 5 years. Companies established in Industrial Free Zones may also enjoy a 10 year exemption from income tax;
5. A 15% withholding tax is applicable on i) dividends and ii) interests paid to both resident and non-resident companies;
6. Withholding tax on royalties is applicable at the rate of i) 12% on royalties paid to non-resident companies and ii) 30% on royalties paid to resident companies;
7. A 12% withholding tax is applicable on technical services fees paid to non-resident companies and a reduced rate of 5% to resident companies;
8. Other withholding taxes in Benin include i) 15% withholding tax on profits remitted abroad by foreign entities ii) 12% withholding tax on profits paid to non-resident companies iii) 5% withholding tax on capital gains from disposal of bonds;
9. Other taxes in Benin include i) 15% withholding tax on profits remitted abroad by foreign entities ii) 12% withholding tax on profits paid to non-resident companies iii) 5% withholding tax on capital gains from disposal of bonds;
10. Other taxes in Benin include i) 4% payroll tax ii) 6% real property tax iii) 8% transfer tax levied on the transfer of property iv) 15.4% monthly social security contribution applicable on employees’ gross salaries;
11. Benin has so far entered into 4 double tax treaties with France, Norway, Kuwait, together with the 8 countries of the West African Economic and Monetary Union (WAEMU);
12. Healy Consultants 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;