The International Tax Handbook

The International

Tax Handbook

6th Edition

The International

Tax Handbook

6th Edition

The International

Tax Handbook

6th Edition

Bloomsbury Professional Ltd, Maxwelton House, 41–43 Boltro Road,

Haywards Heath, West Sussex, RH16 1BJ

© 2017 Nexia International Limited. All rights reserved. The trade marks NEXIA

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References to Nexia or Nexia International are to Nexia International Limited.

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ISBN: 978 1 78451 396 2

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v

Contents

Introduction vii

Glossary ix

Countries

Angola 1

Argentina 7

Australia 15

Austria 23

Azerbaijan 33

Bahrain 41

Barbados 47

Belgium 53

Bolivia 63

Brazil 69

Bulgaria 77

Cambodia 89

Cameroon 99

Canada 107

Cayman Islands 115

Channel Islands, Guernsey 123

Channel Islands, Jersey 129

Chile 135

China (People’s Republic of) 145

Colombia 153

Croatia 159

Cyprus 169

Czech Republic 179

Denmark 187

Dominican Republic 197

Ecuador 205

Egypt 219

El Salvador 227

Estonia 235

Finland 243

France 253

French Polynesia 267

Georgia 279

Germany 291

Ghana 303

Gibraltar 309

Greece 317

Guatemala 329

Honduras 335

Hong Kong 341

Hungary 347

India 359

Indonesia 377

Iraq 385

Ireland (Republic of) 391

Isle of Man 403

Israel 409

Italy 415

Japan 423

Jordan 433

Kazakhstan 439

Kenya 449

Korea, Republic of 455

Kuwait 467

Lebanon 473

Liechtenstein 483

Luxembourg 491

Malaysia 503

Malta 515

Mauritius 527

Mexico 533

Morocco 539

Mozambique 549

Myanmar 557

Netherlands (The) 567

Nevis 577

New Zealand 583

Nigeria 595

Norway 603

Pakistan 615

Panama 623

Peru 629

Philippines 637

Poland 647

Portugal 659

Puerto Rico 671

vi The International Tax Handbook

Romania 683

Russia 695

Saudi Arabia 709

Senegal 715

Serbia 721

Singapore 731

Slovakia 743

Slovenia 757

South Africa 767

Spain 779

Sri Lanka 791

Sweden 799

Switzerland 807

Taiwan 819

Tanzania 825

Thailand 837

Tunisia 847

Turkey 855

Uganda 863

Ukraine 881

United Arab Emirates 889

United Kingdom 901

United States 915

Uruguay 923

Venezuela 929

Vietnam 937

vii

Introduction

This is the sixth edition of the International Tax Handbook that has been produced by

Nexia International, Nexia International is a leading worldwide network of independent

accounting and consulting fi rms, providing a comprehensive portfolio of audit,

accountancy, tax and advisory services. I would like to thank all the contributors for their

invaluable assistance.

This edition contains more chapters than previous editions of this book and each chapter

provides an overview of the tax system in the relevant country and deals with information

generally sought by businesses to understand the fi scal regime. This edition continues to

include details of the withholding taxes applied to the major cross border transactions

based on the double taxation conventions.

This book has been prepared in a tabular format to unify the content of each chapter

and highlight the core tax aspects for each country. Each section is split into corporate,

personal and indirect taxes which should provide the reader with an overview of the tax

system in place in a specifi c country.

Every effort has been taken to ensure that the information provided in this book is accurate

and up to date. However, it is only meant to provide a general overview of the prevailing

tax systems and should not be used as a substitute for professional tax advice.

Neither the author nor the publishers can accept any responsibility for any loss sustained

by any person relying on the information provided in this book and failing to seek

appropriate professional advice.

Therefore, I would like to stress the importance of obtaining local advice before any action

is taken or decision is made. Any queries can be addressed to the local Nexia offi ces

directly, using the contact information provided in the Handbook. For a comprehensive

list of Nexia International members worldwide, visit the Nexia International “ Locations ”

section at www.nexia.com

James Wall

[email protected]

Editor

January 2017

Nexia International

Tel: + 44 (0) 20 7436 1114

Fax: + 44 (0) 20 7436 1536

E-mail: [email protected]

Web: www.nexia.com

ix

Glossary

CGT Capital Gains Tax

CT Corporate Tax (tax on income of corporation)

IHT Inheritance Tax

PE Permanent establishment (PE) is a fi xed place of business,

such as a place of management, a branch, an offi ce, a factory,

a workshop, an installation or structure for the exploration of

natural resources, any place of extraction of natural resources,

a building site or construction or installation project, through

which the business is carried on. An agent acting on behalf

of the company may also constitute a PE if he has and habitually

exercises the authority to do business on behalf of the company.

SME Small and medium-sized enterprise

VAT Value Added Tax

1

Angola

(Prepared by the Angolan desk of NG Auditoria e Consultoria Lda,

NG Auditoria e Consultoria Lda, [email protected])

I MAIN LEGAL FORMS

Legal form

Characteristics

General partnership (SENC) and

Limited partnership (SEC)

Private corporation (SQ) and

Public corporation (SA)

Partners/shareholders

● Number

● Restrictions

General partnership ( Sociedade em

Nome Colectivo):

Minimum number of partners: two

Limited partnership ( Sociedade em

Comandita):

Minimum number of partners: two,

or fi ve if the capital is represented

by shares

Private corporation ( Sociedade por

Quotas) (SQ):

Minimum number of quotaholders:

two

Public corporation ( Sociedade

An ó nima) (SA):

Minimum number of shareholders:

fi ve

Directors Management is attributed to the

directors, independent of being

partners

● One or more directors

(independent of being

quotaholders)

● General meeting (for relevant

decisions)

● Board of Directors or a single

director in the cases allowed by

law, all controlled by an Audit

Committee or an Individual

Qualifi ed Auditor ( Conselho Fiscal

or Fiscal Ú nico)

2 The International Tax Handbook

Legal form

Characteristics

General partnership (SENC) and

Limited partnership (SEC)

Private corporation (SQ) and

Public corporation (SA)

Registration Companies have to register at:

● National Private Investment Agency (Ag ê ncia Nacional para o

Investimento Privado - ANIP) in order to obtain the Private Investment

Registry Certifi cate (Certifi cado de Registo do Investimento Privado -

CRIP), licence for import of capital. The minimum value for the

investment by the ANIP is US $ 1,000,000 (only for foreign investment)

● Registry of Company Names ( Ficheiro Central de Denomina ç õ es Sociais

or Guich é Ú nico da Empresa)

● Commercial Company Register ( Registo Comercial)

● Tax authorities declaring the start of activity

● Statistical Record (Instituto Nacional de Estat í stica)

● Registration as importer/exporter (Direc ç ã o Nacional do Com é rcio)

● Social security Registration (Instituto Nacional de Seguran ç a Nacional)

● Bank account opening in a company name;

● Deposit of funds for capitalisation of the project where it is a private

investment project

Minimum capital None SQ: the amount in Kwanzas

equivalent to US $ 1,000

SA: the amount in Kwanzas

equivalent to US $ 20,000

Liability General partnership: unlimited,

subsidiary and joint liability

Limited partnership: limited liability

or unlimited, subsidiary and joint

liability, depending on the type of

partner

Limited

Governance Partners Board of Directors

Audit requirements Not mandatory Mandatory

Taxation Corporation tax ( Imposto Industrial) Corporation tax ( Imposto Industrial)

Usage Minimal SQ: mainly small and medium￾sized companies

SA: larger/listed companies

Angola 3

II CORPORATION TAX

Legal form

Description Resident corporation Permanent establishment (PE)

General description Corporation tax ( Imposto Industrial): annual tax due for the income obtained

by residents or non-residents as a result of any commercial or industrial

activity. The income is classifi ed into two groups (A and B), depending on

the dimension of the activity and of the annual income

Taxable entities Corporations with headquarters,

domicile or effective management

in Angola

PE located in Angolan territory

Taxable income Worldwide income Income attributable to the Angolan

territory

Calculation of

taxable profi ts

Taxable profi ts are based on results arising from accounting records,

adjusted for tax purposes due to different criteria

Interest payments Interest payments are deductible

Interest receivable on Government bonds which are part of technical

reserves set up by insurance companies or by companies managing

securities is deductible from income (tax exempt) in the cases stated by law

[art 45 º , 1, b) CII]

Related party

transactions

There are provisions in place allowing the tax authorities to adjust:

● the taxable income because of related party transactions

● the taxable income of foreign activities if not corresponding to income

determined according to domestic rules

Tax year, return and

payment

The tax year corresponds to the calendar year

Tax returns shall be fi led:

● Group A: in May following the tax year (or June where the taxpayer has

premises or a permanent representation outside the province in which it

has its head offi ce)

● Group B: in April following the tax year

The payment shall be carried out as follows:

● Group A: three payments during the year

● Group B: only one payment 1

Capital gains Included in the computation of the taxable income and taxable at the

normal tax rate

Losses Tax losses may be carried forward for a period of three years

Tax group N/A

Tax rate 30 % , or 15 %for agricultural, forestry and livestock activities

1 Corporate tax has to be withheld on payments to companies and individuals including those

which have headquarters, effective management or a PE in Angola, at a fl at rate of 35 %

applicable to a taxable amount equal to 10 %of the net value of any contract related to

construction, benefi tting or maintaining immovable assets, or 15 %in all other cases.

4 The International Tax Handbook

III TAXES FOR INDIVIDUALS

Residents Non-residents

Income Tax

General description Tax on income received by individuals

Taxable entities and

taxable income

Residents are taxed on their

worldwide income

Non-residents are taxable on

all income obtained in Angola

Types of taxable

income

Mainly income deriving from employment and independent

workers, such as wages, salaries, fees, bonus and premiums

Certain fi nancial income and capital gains 2

Calculation of income The tax is applicable over the total monthly income and is

calculated according to a progressive tax rate

Tax year, tax

assessment and tax

payment

Tax year –calendar year

Income obtained by employees: employers are required to

withhold tax over payments to employees and deliver the amounts

withheld by the end of the following month

Income obtained by independent workers: they must fi le their tax

return during January of the following year

Losses Losses may not be carried forward

Tax rates Employees: the progressive tax rate is 0 %to 17 %

Independent professionals: the progressive tax rate is 15 %to 70 %

Residents Non-residents

Capital Gains Tax (CGT)

General description There is no specifi c tax on capital gains. Capital gains / fi nancial

income may be subject to withholding tax 3

Taxable entities and

chargeable assets

Calculation of gain

Tax year, tax

assessment and tax

payment

Tax rates

Domiciled Non-domiciled

Inheritance Tax

(IHT)

General description This tax is levied on the value of gratuitous transfers at progressive

rates (from 10 %to 15 %in case of transfers in favour of spouses,

ascendants or descendants, and from 20 %to 30 %in all other

cases). Transfers in favour of descendants, ascendants and spouses

with a value less than 500,000 Kwanzas are exempt from the

payment of this tax

2 Individuals are autonomously taxed on certain fi nancial income/capital gains (see note 1 above).

3 See note 1 above.