Personal Income Tax (PIT)

Personal Income Tax (PIT)

Who is liable?

  • Worldwide incomes of Individuals who have their tax domicile located in Chad, whether they are Chadian or not.
  • Persons who have their tax domicile located outside Chad are subject to personal income tax only on their income derived from Chad.

An individual is considered resident in Chad in the following cases:

  • He or she is present in Chad more than 183 days during a fiscal year.
  • He or she has a permanent home in Chad as an owner, usufructuary or tenant.
  • His or her main economic resources are from Chadian sources.

What category activity is subjected to PIT?

  • Salaried activity including benefit in kind (Tax Withheld at source)
  • Self-employed individuals (handicrafts, commercial, professional and agricultural)
  • Professional ministerial officers and liberal professions
  • Investment incomes (dividend, interest on loan savings accounts, etc….)
  • Capital Gain

What income is subject to tax?

  • Employment income includes directors’ fees and almost all cash and non-cash payments, allowances and benefits arising from employment.
  • Benefit in Kind are taxed at a percentage of employment income.

Benefit in kind rate :

Benefit

Rate (%)

Accommodation

20

Vehicle

10

Water - Electricity

2

Domestic servants

4

Caretaking

4

Gas

4

Telephone

1

  •  The net income from each of the above categories is combined, and the total is subject to the progressive rates set forth in
  • Individuals may claim a deduction of social contributions
  • All the activities are aggregated with profits from other sources to determine annual global taxable income, and taxed at the rates set forth below :

    Taxable Revenue

    Above

    Below

    Rate %

    XAF

    XAF

    0

    800

    0

    800,001

    2,500,000

    10

    2,500,001

    7,500,000

    20

    7,500,001

    -

    30

     

Some PIT highlights

  • Employers must file an annual statement of salaries by 31 January following the end of the preceding year.
  •  This declaration also includes commissions, fees etc. of more than XAF 25,000, as well as amounts paid to managers, and board members
  •  Special allowances granted to employees with respect to charges and expenses relating to their function, provided that the amount of such allowances does not exceed 15% of the gross salary including these allowances
  •  Some salary related elements are not taxable such as: Unemployment allowances, Scholarship allowances, Transportation allowances, Gratuities; Severance pay allocated within the framework of a social plan or voluntary departure.
  •  Dividend and interest paid to individual are subjected to 20% withholding tax for resident. For nonresident 20% for dividend and 25% for interest.
  •  Some interests are exempted such as interest deriving from savings accounts with some limitations

 What are the PIT and CIT regimes ?

Three tax regimes, depending on their annual earnings.

Earning(XAF)

Regime

Determination

Comments

Less than or equal 50 Million

Discharge tax

Fix amount(Min/Max) scale by activity type and geographic zone

Trading businesses, Final tax

50 millions - 100 Millions

Simplified

Like under normal regime

All activities

100 millions - 500 Millions

Simplified

Like under normal regime

Above 500 Millions

Normal

Book profit / Loss

Cost deductibility from revenue

What are the deductions?

  • Are eligible, only resident individuals
  • Interest on borrowings to finance investments in property.
  • Arrears paid to ascendants or descendants or the value of collateral with respect to such borrowings, up to a maximum of XAF600,000 per year.
  • Payments under a court decision as a result of separation or divorce. If the procedure is pending in court, an additional condition is that the spouse be taxed separately.

Others PIT Related :

Tax

Basis

Rate

Contributor

Periodicity

Taxe d'Apprentissage

Gross salary + BIK

1,20%

Employer

Monthly

Taxe Forfaitaire

Gross salary + BIK

7,50%

Employer

Monthly

F.I.R

Fix

40 XAF

Employee

Monthly

Last Update: July 31st 2021

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