The Gambia's tax system is administered by the Gambia Revenue Authority (GRA). It includes various taxes and contributions levied on both employers and employees. Understanding these obligations is crucial for businesses operating in Gambia to ensure compliance and avoid penalties. This guide provides an overview of employer tax obligations and employee tax deductions in Gambia for 2025.
Employer Social Security and Payroll Tax Obligations
Employers in Gambia are required to make social security contributions on behalf of their employees. These contributions are managed by the Social Security and Housing Finance Corporation (SSHFC). The primary contributions include:
- Pension Fund: Employers contribute a percentage of the employee's gross salary to the pension fund.
- Industrial Injuries Compensation Fund: This covers employees in case of work-related injuries or diseases.
- National Health Insurance Scheme (NHIS): Contributions to the NHIS are mandatory for employers and employees to provide access to healthcare services.
Here's a summary of the contribution rates:
| Contribution | Employer Rate | Employee Rate |
|---|---|---|
| Pension Fund | 10% | 5% |
| Industrial Injuries Compensation Fund | 1% | 0% |
| National Health Insurance Scheme | 1.5% | 1.5% |
These rates are subject to change, and employers should consult the SSHFC for the most up-to-date information.
Income Tax Withholding Requirements
Employers are responsible for withholding income tax (Pay-As-You-Earn or PAYE) from their employees' salaries and remitting it to the GRA. The PAYE system is based on a progressive tax structure.
The income tax rates for 2025 are as follows:
| Taxable Income (GMD) | Rate |
|---|---|
| 0 - 12,000 | 0% |
| 12,001 - 36,000 | 15% |
| 36,001 - 72,000 | 25% |
| Above 72,000 | 30% |
To calculate the PAYE, employers must:
- Determine the employee's gross monthly income.
- Subtract any allowable deductions and allowances (see section on Employee Tax Deductions and Allowances).
- Apply the progressive tax rates to the remaining taxable income.
- Remit the tax to the GRA by the 15th of the following month.
Employee Tax Deductions and Allowances
Employees in Gambia are entitled to certain tax deductions and allowances that reduce their taxable income. These may include:
- Personal Relief: A standard deduction available to all employed individuals.
- Dependant Relief: An allowance for supporting dependent children or other relatives. Specific conditions and limits apply.
- Pension Contributions: Employee contributions to approved pension schemes are tax-deductible.
- Medical Expenses: Certain medical expenses may be deductible, subject to specific rules and documentation requirements.
- NHIS Contributions: Employee contributions to the National Health Insurance Scheme are tax-deductible.
Employees must provide the necessary documentation to their employers to claim these deductions and allowances. The specific amounts and conditions for these deductions are subject to change, so it's important to consult the GRA guidelines.
Tax Compliance and Reporting Deadlines
Employers in Gambia must adhere to specific deadlines for tax compliance and reporting. Key deadlines include:
- Monthly PAYE Remittance: Income tax withheld from employees' salaries must be remitted to the GRA by the 15th of the following month.
- Annual Employer Reconciliation: Employers must file an annual reconciliation of PAYE deductions and remittances by a specified date, usually in January or February of the following year.
- Social Security Contributions: Monthly contributions to the SSHFC must be remitted by the 15th of the following month.
- Annual Social Security Reconciliation: Employers must submit an annual reconciliation of social security contributions.
Failure to comply with these deadlines may result in penalties and interest charges.
Special Tax Considerations for Foreign Workers and Companies
Foreign workers and companies operating in Gambia are subject to the same tax laws and regulations as domestic workers and companies. However, there are some special considerations:
- Residency Status: The tax treatment of foreign workers depends on their residency status. Individuals who are resident in Gambia for tax purposes are taxed on their worldwide income, while non-residents are taxed only on income sourced in Gambia.
- Double Taxation Agreements: Gambia has double taxation agreements (DTAs) with some countries. These agreements may provide relief from double taxation for foreign workers and companies.
- Expatriate Allowances: Certain allowances paid to expatriate employees, such as housing and transportation allowances, may be subject to different tax treatment.
- Permanent Establishment: Foreign companies operating in Gambia may be deemed to have a permanent establishment if they have a fixed place of business in the country. This can trigger corporate income tax obligations.
Foreign workers and companies should seek professional tax advice to ensure they comply with all applicable tax laws and regulations.
