Update: New IRPS Code

Today in Luanda, we presented and discussed the main aspects of the ongoing tax reform regarding taxation of personal income (E&M Taxation Conference, The New IRPS Code: Broadening the Tax Base and Its Impact on Individuals and Businesses).

The Chairman of the Board of AGT highlighted three key aspects of the legislative proposal already submitted to the National Assembly, which reflect changes compared to the version previously released for public consultation:

the expected effective date of the new IRPS Code is January 1, 2027 (and not 2026, as initially proposed), allowing for a longer transition period, but with a direct impact on employment income and the taxation of benefits in kind;
income aggregation (“englobamento”) will only apply from January 1, 2028 (maintaining the current system of separate taxation for different categories of income); and
tax residency in Angola will be determined based on a physical presence in the country for more than 183 days, whether consecutive or non-consecutive, within a 12-month period (instead of 90 days, as foreseen in the initial proposal).

Despite the extended transition period before the reform takes effect, companies should already begin preparing for the new tax model by assessing its impact and adjusting internal processes, HR policies, and reporting systems - particularly in relation to international mobility and compensation & benefits.

In the specific case of Banks, systems and client relationship teams must be prepared for the taxation of income earned abroad by resident Clients.

This additional period therefore represents a strategic opportunity for timely preparation, helping to mitigate compliance risks and ensuring an efficient transition to the new individual income tax model.

KPMG is supporting companies in anticipating the implications of the proposed changes, both in the domestic and international tax context.