Understanding the diverse tax systems of 54 different countries on the African continent can be challenging. Our team of Africa tax specialists advise on investments in Africa including:
We have an extensive best friend network of many of the leading law and tax advisory firms in Africa. These relationships offer a competitive advantage as they enable us to project manage the largest and most complex cross-border transactions in Africa.
Company income taxes and withholding taxes
Most African countries operate source-based tax systems as compared to the residence-based system used in more developed countries. Because of this, African countries tend to impose high taxes on income (up to 45%) and high withholding taxes (up to 35%) on cross-border cash flows, including dividends, interest, royalties and management and consultancy fees.
Minimising such taxes through the use of appropriate tax treaties is challenging for a number of reasons including the facts that:
There is not a "one-size-fits-all" tax structure for African investments. However, with a sound understanding of the tax systems of the countries involved and careful tax planning, it is generally possible to reduce the tax cost of doing business in Africa.