Verified Facts
Tax rates in Togo range from 5% to 35% for individual income, with a corporate tax rate of 27%, and a value-added tax (VAT) rate of 18%, making it essential for expats and businesses to understand the tax system to ensure compliance and maximize benefits.
Tax laws change frequently. Always consult a qualified tax professional for advice specific to your situation. This is a general guide only.
Quick Facts
Tax System Overview
Togo has a territorial tax system, where individuals and companies are taxed on their income earned within the country, regardless of their residency status. However, residents are also subject to tax on their worldwide income, with foreign tax credits available to avoid double taxation. To be considered a tax resident in Togo, an individual must have a permanent home in the country, or spend more than 183 days in a calendar year.
The tax system in Togo is governed by the General Tax Code, which provides the framework for taxation of individuals and companies. The tax authorities in Togo are responsible for collecting taxes, and taxpayers are required to file tax returns and pay taxes on a timely basis. The tax year in Togo runs from January to December, and taxpayers must file their tax returns by the end of March of the following year.
Personal Income Tax
| Income Bracket (XOF) | Tax Rate |
|---|---|
| 0 - 250,000 | 5% |
| 250,001 - 500,000 | 10% |
| 500,001 - 1,000,000 | 15% |
| 1,000,001 - 2,000,000 | 25% |
| 2,000,001 and above | 35% |
| Taxpayers in Togo are entitled to deductions and allowances, including a personal allowance of XOF 250,000, and deductions for mortgage interest, charitable donations, and education expenses. Tax returns must be filed electronically, and taxpayers are required to pay taxes on a quarterly basis. |
Corporate & Business Tax
- The corporate tax rate in Togo is 27%, with a reduced rate of 15% for small and medium-sized enterprises (SMEs) with an annual turnover of less than XOF 500 million.
- Small business incentives are available, including a reduced tax rate and exemptions from certain taxes, for businesses that invest in specific sectors such as agriculture and manufacturing.
- Togo has free zones that offer tax exemptions and other incentives to companies that operate within these zones, including the Lomé Free Zone and the Kpalimé Free Zone.
- Companies must register with the tax authorities and obtain a tax identification number (TIN) to operate in Togo.
- Value-added tax (VAT) registration is required for businesses with an annual turnover of XOF 50 million or more.
VAT / Sales Tax
- The standard VAT rate in Togo is 18%, with a reduced rate of 10% for certain goods and services, such as basic foodstuffs and pharmaceuticals.
- Exemptions are available for certain goods and services, including exports, and goods and services that are not subject to VAT.
- A tourist refund scheme is available for non-resident tourists who purchase goods and services in Togo, allowing them to claim a refund of VAT paid on their purchases.
- VAT returns must be filed on a monthly basis, and taxpayers are required to pay VAT on a timely basis to avoid penalties and interest.
For Expats & Foreign Workers
- Tax residency rules in Togo are based on the number of days spent in the country, with individuals who spend more than 183 days in a calendar year considered tax residents.
- Togo has double taxation treaties with 8 countries, including France, Germany, and the United Kingdom, to avoid double taxation and fiscal evasion.
- Social security contributions are mandatory for employees and employers in Togo, with rates ranging from 10% to 15% of gross salary.
- Remittance rules in Togo require taxpayers to declare and pay taxes on foreign-sourced income, with foreign tax credits available to avoid double taxation.
- Work permits are required for foreign workers in Togo, and must be obtained before commencing work in the country.
- Tax clearance certificates are required for foreign workers who leave Togo, to confirm that all taxes have been paid and to avoid any tax liabilities.
Crypto & Investment Income
- Investment income, including dividends, interest, and capital gains, is subject to tax in Togo, with a withholding tax rate of 15% for non-residents.
- Cryptocurrency is subject to tax in Togo, with gains from the sale of cryptocurrency considered capital gains, and subject to tax at a rate of 27%.
- Dividends received by shareholders are subject to a withholding tax rate of 15%, with a reduced rate of 10% for dividends received by residents.
- Interest income earned by individuals is subject to tax, with a withholding tax rate of 10% for interest earned on bank deposits and other investments.