GuineaTax Obligations Detailed

Employers in Guinea have various tax obligations related to payroll, social security, and other levies.

Employer Taxes

• Corporate Income Tax: The standard corporate income tax rate is 25%. However, specific sectors have different rates:
  • Mining Companies: 30%
  • Telephone Companies, Banks, Insurance, and Petroleum Importers/Distributors: 35%
• Payroll Tax (Versement Forfaitaire sur les Salaires): This tax is levied at 6% of the total gross salary paid to all employees.
• Social Security Contributions: Employers contribute 18% of each employee's gross salary, distributed as follows:
  • Family Allowance: 6%
  • Work Injury: 4%
  • Retirement: 4%
  • Illness/Medical Expenses 4% (Note: the combined employer and employee contributions to Health insurance is 6.5%). There is a monthly ceiling for these contributions.
• Transfer Pricing: Guinea has transfer pricing rules to prevent tax avoidance through transactions between related parties. Documentation is required for companies exceeding a certain turnover threshold.

Employee Taxes

• Personal Income Tax: A progressive tax system applies to resident individuals based on their taxable income. Non-residents are taxed on Guinea-sourced income only.
  • Up to 1,000,000 GNF: 0%
  • 1,000,001 - 3,000,000 GNF: 5%
  • 3,000,001 - 5,000,000 GNF: 8%
  • 5,000,001 - 10,000,000 GNF: 10%
  • 10,000,001 - 20,000,000 GNF: 15%
  • Over 20,000,000 GNF: 20%
• Social Security Contributions: Employees contribute 5% of their gross salary towards social security. Note: the combined employer and employee contributions for social security is 23%. This 5% is divided as follows:
  • Retirement, Disability, and Death: 2.5%
  • Illness/Medical Expenses: 2.5% (Note: the combined employer and employee contribution to Health insurance is 6.5%). There is a monthly ceiling for these contributions.

Other Taxes

• Real Property Tax (Contribution Foncière Unique): This tax is based on the annual rental value of the property. The rates vary as follows:
• 5% for owner-occupied or unrented residential buildings
• 10% for owner-occupied or unrented buildings for professional use
• 15% for rented buildings.

Additional Information:

• Payroll Cycle: The typical payroll cycle in Guinea is monthly.
• Minimum Wage: GNF 550,000 per month (as of August 2024).
• Overtime: Overtime rules in Guinea are subject to specific regulations limiting the number of hours and requiring premium payments for work exceeding standard hours.

Disclaimer: This information is for general guidance only and is current as of February 5, 2025. It is essential to consult with a tax advisor for specific advice related to your situation as tax laws and regulations are subject to change.

In Guinea, employee tax deductions encompass payroll tax, social security contributions, and other applicable deductions.

Payroll Tax

A progressive payroll tax system is in place, with rates varying based on income levels. A new 8% payroll tax rate applies to earnings between GNF 3,000,000 and GNF 5,000,000. Certain tax-free allowances are capped at 25% of gross salary.

Social Security Contributions

Employees contribute to the national social security system. Specific contribution amounts and rates vary depending on several factors and should be confirmed with local authorities or a qualified professional.

Other Deductions

• Donations, Tips, and Gifts: These are deductible up to 1.5% of income.
• Equipment, Tools, and Office Furniture: Deductions for these items are limited to a unit value of GNF 5,000,000.

Additional Information on Guinean Taxation

• Tax Exemptions: Tax exemptions require ratification by the National Assembly.
• Flat-Rate Levy (BIC): This levy applies to local purchases from unregistered VAT vendors, impacting a broader range of individuals and businesses.
• Tax Payment Flexibility: The Guinean government offers tax payment staggering options for taxpayers facing temporary difficulties.
• Apprenticeship Tax: This tax now applies to companies with fewer than 30 employees.
• Corporate Income Tax: Losses from one financial year are deductible from the following year's profit, up to 70% of taxable profit. The remaining loss can be carried forward indefinitely within the same limit.
• Withholding Tax on Non-Wage Income (RNS): Applies to service providers without effective management in Guinea. Services ancillary to goods supplies are exempt.
• License Tax: The rate is based on the previous year's turnover.

It is crucial to remember that tax laws are complex and subject to change. The information provided is current as of today, February 5, 2025, and may not reflect future amendments or interpretations. Always consult official government resources or a qualified tax professional for personalized advice.

In Guinea, the Value Added Tax (VAT), known locally as Taxe sur la valeur ajoutée (TVA), is levied on most goods and services.

VAT Rates

• Standard Rate: 18% applies to all transactions unless an exception applies.
• Zero Rate (0%): Applies to specific goods and services, allowing for VAT deduction. Examples include exports, pharmaceuticals, books, school supplies, and basic foodstuffs (rice, wheat, flour, bread, and certain oils).
• Exempt Supplies: These are exempt without the right to deduct VAT. Examples include sales and imports of stamps, financial transactions (interest, bank charges), real properties subject to registration fees, rentals of undeveloped land and bare premises, printed periodicals, and certain non-profit activities.

VAT Registration

Businesses are automatically subject to VAT if their turnover equals or exceeds GNF 500 million (approximately USD 52,113 as of October 12, 2021). Businesses with turnover between GNF 150 million and GNF 500 million (approximately USD 15,633.9 and USD 52,113 respectively as of October 12, 2021) may be taxed under authorization. Non-resident businesses providing digital services are also subject to VAT with no threshold and must appoint a tax representative.

Filing and Payment

Businesses must file for VAT registration within 15 days of starting activities. Monthly VAT returns must be submitted by the 15th of the following month.

VAT on Digital Services

Guinea applies VAT to non-resident providers of digital services. A tax representative is required, and there's no registration threshold. For B2B transactions, a reverse charge mechanism applies.

Other Considerations

• Free distribution of goods for advertising or sales promotions is excluded from the VAT base.
• Sales of second-hand goods by taxpayers who used them for business purposes are exempt.
• Tourism activities are subject to a separate tourism tax.
• Exchange gains from currency conversion are not subject to VAT.
• Business transfers are subject to registration fees, exempt from VAT.
• Warranty repairs are taxable as accessory services to the sale of goods.
• Late VAT payment penalties include 2% monthly interest and a 10% increase on duties, with a minimum of GNF 100,000.

It's crucial to remember that tax regulations are subject to change, and this information is current as of February 5, 2025. Consulting with a tax advisor is recommended for the most up-to-date and specific guidance.

Guinea offers various tax incentives, primarily focused on mining and petroleum industries, with additional incentives under the Investment Code.

Mining and Petroleum Incentives

• The Petroleum and Mining Codes, often supplemented by mining conventions, offer specific tax exemptions and incentives. These benefits vary depending on the phase of operation (exploration or production).
• Mining conventions commonly include exemptions from Value Added Tax (VAT).
• Subcontractors of mining title holders also often benefit from these exemptions.

Investment Code Incentives (Zone B)

• Zone B, encompassing most of Guinea outside specific designated areas, offers incentives under the Investment Code's privileged regime. These incentives apply during the initial installation phase, capped at three years from the first import of project equipment.

• Key benefits include:

  • Exemption from import duties and taxes (including VAT).
  • Reduced registration tax (0.5% of CIF value).
  • Exemption from professional license fees, real estate tax, flat-rate tax on wages, and apprenticeship tax (under specific conditions).

Corporate Tax Rates and Minimum Tax

• The standard corporate tax rate for mining title holders is 30% of taxable profit.
• A Lump Minimum Tax, calculated as 1.5% of turnover, also applies. Specific thresholds for this minimum tax are based on company size:
  • Medium-sized companies: Minimum GNF 15 million, maximum GNF 45 million.
  • Large companies: Minimum GNF 75 million, maximum GNF 100 million.
• Certain sectors, including telecommunications, banking, insurance, and petroleum product importers and distributors, are exempt from the Lump Minimum Tax.

Additional Notes

• While VAT exemptions exist within the Investment Code, there are recommendations to remove them due to their fiscal impact.
• Guinea introduced VAT on January 1, 2025, replacing the previous general sales tax. This new system allows businesses to claim input tax credits, potentially impacting existing incentive structures.
• It is important to note that tax regulations and incentives can change. Consulting with a tax professional or the relevant Guinean authorities for the most up-to-date information is recommended. This overview is current as of February 5, 2025.