Cameroon

In Cameroon, employers shoulder various tax obligations, including payroll taxes, social security contributions, and corporate income tax.

Employer Payroll Taxes

• Payroll Tax (Housing Loan and Employment Fund): 2.5% of total salaries and fringe benefits. This is paid monthly.
• Additional Council Tax: 10% of the Personal Income Tax (PIT) withheld from employees.
• Audiovisual Tax: Paid by private and public sector employees. The rate is determined based on the employee's salary range.

Social Security Contributions

• National Social Insurance Fund (NSIF): Employers contribute 11.2% of the employee's gross salary, capped at XAF 750,000 per month.
• National Social Insurance Fund (Industrial Accidents): 1.75% of total salaries for Group A activities, 2.5% for Group B, and 5% for Group C. This is based on the employee's gross salary, including benefits-in-kind.

Corporate Income Tax (CIT)

• Standard Rate: 35%, plus a 10% surcharge, effectively totaling 38.5%.
• Reduced Rate: 30% (plus 10% surcharge, totaling 33%) for publicly listed companies during their first three years on the national stock exchange.
• Tax Return Due Date: March 15th annually. Monthly advance payments are also required by the 15th of each month.

Personal Income Tax (PIT) Withholding

• Withholding: Employers withhold PIT from employee salaries based on a progressive scale ranging from 11% to 38.5%. No PIT is withheld for monthly salaries below XAF 62,000.
• Payment: PIT withheld is remitted to tax authorities by the 15th of the following month.
• Annual Return: Employee tax reconciliation returns are due by March 15th for professional individuals and June 30th for non-professionals.

Value Added Tax (VAT)

• Rate: 19.25%.
• Filing and Payment: Returns and payments are due by the 15th of each month.

Other Taxes and Duties

• Transfer Tax: 10% on the sale of a business. A 5% registration duty applies to share transfers not involving the business transfer.
• Stamp Duty: Varies from 1% to 15% based on the transaction. A minimum duty of XAF 1,500 applies.
• Property Tax: 0.1% of the assessed property value annually.

Note: This information reflects the status as of February 5, 2025, and might be subject to change. You should seek professional advice for your specific circumstances.

In Cameroon, employee tax deductions are calculated based on a progressive tax system with specific deductions allowed, impacting an employee's net pay.

Cameroon Employee Tax Deductions

As of today, February 5, 2025, this information is current, but may be subject to changes in the future. Therefore, it is always recommended to confirm the latest regulations with official sources.

Income Tax (PIT)

• Progressive Rates: Cameroon's Personal Income Tax (PIT) follows a progressive structure. While specific percentages and brackets can vary based on legislation, the principle is that higher earners are taxed at higher rates. For example, rates can range from 11% for lower income levels up to 38.5% for higher levels. You can find the current income brackets and tax rates from the tax administration.
• Deductions: Several deductions can reduce the taxable income:
  • Business Expenses: Up to 30% of the taxable salary can be deducted as business expenses.
  • Social Security Contributions: Employee contributions to the social security system are deductible.
  • Standard Abatement: A standard annual deduction of XAF 500,000 is typically available for wages and salaries.
• Threshold for Deductions: Income tax is generally deducted at source only for salaries equal to or exceeding XAF 62,000 per month. Earnings below this are exempt from direct income tax withholding.
• Employer Responsibilities: Employers are responsible for deducting income tax from employee salaries and remitting the tax to the relevant authorities before the 15th of each month. Annual tax returns and any outstanding tax balance are typically due by March 15th of the following year.

Other Deductions

• Additional deductions or allowances might exist depending on the nature of employment or specific legal provisions. It is crucial to stay updated on the latest tax regulations to ensure accurate payroll calculations.

Additional Information

• Tax Year: The Cameroonian tax year typically aligns with the calendar year.
• Penalties: Late filing or payment of taxes can result in penalties, such as interest charges, so adherence to deadlines is crucial.
• Specific Regulations: It is advisable to stay informed about current tax laws and consult official sources or tax professionals for precise details.

This detailed summary offers insights into Cameroon's employee tax deductions and obligations. Always verify the most recent updates as tax laws can change.

In Cameroon, businesses providing goods and services are generally subject to Value Added Tax (VAT).

VAT Rates

• Standard Rate: 19.25% (This includes a 17.25% VAT and a 10% council tax). This applies to most goods and services. As of today, February 5, 2025, certain essential goods are exempt from VAT as specified in the 2025 finance law. Further details on these exemptions haven't been publicly specified yet but should become clear as the year progresses.
• Zero Rate: 0% applies to exports of taxable goods. Certain goods and services are also exempt, but the right to deduct VAT may not apply. These include the transfer of real estate, educational services, and some basic food products.

VAT Registration

• Threshold: Businesses must register for VAT if their annual turnover exceeds XAF 50,000,000.
• Process: Registration can be done online via the tax administration website (www.impots.cm) or in person at a tax center. Non-resident businesses must appoint a local fiscal representative. This representative is jointly liable for the seller's VAT obligations. Without a representative, the customer becomes liable for withholding the VAT due.

VAT Filing and Payment

• Frequency: VAT returns must be filed monthly.
• Deadline: Returns and payments are due by the 15th of the month following the taxable period.
• Method: Returns can be filed online. While electronic invoicing is not mandatory, it's recommended.

Other Indirect Taxes

• Customs Duties: These range from 5% to 30% on imported goods, depending on the product. Electronically acquired goods imported into Cameroon are subject to customs duties and taxes.
• Excise Taxes: These range from 25% to 50% on specific goods like cigarettes, drinks, cosmetics, and luxury items.
• African Integration Contribution (AIC): 0.2% applies to goods imported from non-African Union countries.

It's recommended to monitor updates from official sources for precise details on the VAT exemptions for essential goods as outlined in the 2025 finance law. The information above is current as of February 5, 2025, and is subject to change as new details about Cameroon's 2025 tax regulations become available. Consulting with a tax professional can provide more clarity regarding specific business situations.

Cameroon offers a range of tax incentives to attract and encourage investment, particularly in key sectors. These incentives typically include exemptions or reductions on various taxes and duties.

General Tax Incentives

• Investment Code Regime: Offers incentives for new investments, expansions, renovations, and business transformations.

  • Installation Phase: Up to five years of exemptions from registration duties, transfer duties, customs duties, and VAT on specific items.
  • Operational Phase: Up to ten years of exemptions and reductions on minimum tax, corporate tax, customs duties on specific items, and other taxes.

• Listed Companies: Companies listed on the Douala Stock Exchange benefit from a reduced corporate income tax (CIT) rate of 25% for three years, starting from the year of listing.

• Youth Employment: Businesses that hire at least five young university graduates annually may be eligible for a tax credit. Other qualifying activities for the tax credit include combating pollution, supporting sports/cultural/social initiatives, and developing public interest activities in rural areas.

Sector-Specific Incentives

• Mining: Distinct incentives are available for both exploration and exploitation phases.

  • Exploration: Exemptions from business license contributions, free registration of incorporation/extension/capital increase deeds, and VAT exemptions on local purchases and imports of approved mining equipment.
  • Exploitation: Payment of registration fees for company creation, extension, and capital increases spread over a year, accelerated depreciation of 1.25 times the normal rate for specified fixed assets, extension of loss carry-forward from four to five years, and zero-rated VAT on exports.

• Agriculture, Livestock, Fisheries: Incentives available to encourage investment in these sectors. Details may vary.

• Other Priority Sectors: Special incentives are granted for investments in priority sectors like tourism, real estate development, agro-industry, energy, water supply, and regional development projects.

Free Zone Regime

Companies operating within designated free zones benefit from significant tax exemptions, such as exemptions from corporate tax, personal income tax, and tax on investment income, as well as a 50% reduction in business license tax.

Application Procedures

Details regarding specific application procedures for each incentive are available through the relevant government ministries or agencies, including the Ministry of Finance (MINFI), the Ministry of Mines, Industry and Technological Development (MINMIDT), and the Ministry for Small and Medium-sized Enterprises, Social Economy and Handicrafts (MINPMEESA). It is highly recommended to consult these entities for the most up-to-date information and precise requirements.

Additional Considerations

• Tax Expenditure Statement: Beneficiaries of tax incentives are required to submit an annual declaration detailing the utilized exemptions and corresponding theoretical tax amounts. This is typically due by March 15th for large companies, April 15th for medium-sized enterprises, and May 15th for micro-enterprises.

• Compliance with Regulations: All tax incentives are subject to compliance with Cameroonian laws and regulations. It is recommended to consult with tax professionals or legal advisors for guidance.

This information is current as of February 5, 2025, and might be subject to change. Always refer to the latest official publications and seek professional advice for specific situations.