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Angola – Proposal for a Reformed Personal Income Tax Code

GMS Flash Alert 2025-079 | 15 April 2025

On 1 April 2025, Angola’s new Personal Income Tax Code (“IRPS”) was made available for public consultation.1  The aim is to gather contributions/input from entities representing civil society, the business sector, and professional associations by 30 April 2025.

This proposal is part of the effort to modernise the Angolan tax system and aims to replace the current taxation model – based on multiple legislation, such as the Employment Income Tax Code (“CIRT”), the Capital Investment Tax Code (“CIAC”), the Stamp Duty Code (“CIS”), and the Property Tax (from the rental income perspective) – with a single legislation that covers taxation of all income of individuals.

WHY THIS MATTERS

This proposal would significantly impact global mobility policies for companies operating in Angola from 1 January 2026.

New challenges could arise, such as determining the individual's tax residence, namely in the years of arrival and departure from Angola, with the possibility of a conflict of tax residence in the home and host countries when there is no double taxation agreement with Angola.

A key shift would be adoption of a worldwide income taxation model for tax residents in Angola (while maintaining territorial taxation for nonresidents), leading to a general obligation to submit an annual income tax return, which could give rise to international double taxation (and follow-on concerns as to how to address that).

Companies are encouraged to revisit their remuneration structures involving split-payroll or dual-contract models, as the current exemption for employment income sourced outside Angola may no longer apply.

The proposed changes broaden the taxable base of the new Category A (employment income) – as a result it is advisable to review the tax implications of remuneration packages, benefits-in-kind, and other compensation elements for employees working in Angola.

New Personal Income Tax Code 

New Rules in Brief 

In summary, the IRPS Code, in the version now proposed, would provide for a paradigm shift in the taxation of individuals.  Key proposals are as follows:

  1. Resident and nonresident individuals in Angola would be subject to IRPS;
  2. A worldwide income taxation model will be adopted for tax residents in Angola, and territorial taxation (income from Angolan sources) for nonresidents, with implications around possible international double taxation and consequent concerns about how to address that;
  3. Tax residency in Angola would be assessed based on the individual's stay in Angolan territory (it would be sufficient that they remain there for more than 90 days, consecutively or not, in any 12-month period starting or ending in the year in question), with the potential for dual-residency conflicts in situations of international mobility;
  4. IRPS would be levied on various types of income, classified into five categories: income from employment (category A); business and professional income (category B); investment income (category C); income from real estate (category D); wealth increase, including capital gains (category E) and, with regards to income from employment, tax will now be due on listed benefits-in-kind (e.g., use of a vehicle, housing);
  5. As a rule, the tax withheld at source when income is paid would be deemed as a ‘payment on account’, with the final tax being calculated by aggregating the overall income received and applying marginal rates of up to 25 percent (with the exception of investment income subject to withholding-tax-at-source at the fixed rates of 10 percent or 15 percent), with the possibility of deductions for some expenses (e.g., health and education);
  6. Resident taxpayers who obtain income from foreign sources in countries with which Angola has signed an agreement to eliminate double taxation (currently, Portugal, the People’s Republic of China, and the United Arab Emirates) would be entitled to a tax credit for international double taxation;
  7. With the exception of individuals who only receive income from employment paid by a single employer entity in Angola, there would be an overall obligation to submit an annual income tax return.

KPMG INSIGHTS

The entry into force of this reform proposal would significantly impact employers – they may wish to evaluate the tax implications arising from their current remuneration structure as is and consider alternative solutions – as well as employees, who would be facing additional reporting obligations and may be impacted by an increase of the applicable tax rates, and potential international double taxation.

Given the substantial potential impact of the reform on the taxation of individuals, KPMG in Portugal is fully aware of the practical implications of the proposed changes for both the domestic (Angola) and international tax contexts.  We are available to support companies with reviewing remuneration packages and formulating alternative solutions for consideration tailored to companies’ particular circumstances, and helping them to adapt their mobility and remuneration policies accordingly, in a timely manner, while also providing ongoing support to employees in complying with the new income tax obligations when they come into force.

FOOTNOTE:

1  (In Portuguese) Administração Geral Tributária, "Proposta de Código do Imposto sobre o Rendimento das Pessoas Singulares (IRPS)".  

Contacts

Sandra Aguiar
Sandra Aguiar

Tax Director of Personal Advisory Services

KPMG in Portugal

Joana Mota
Joana Mota

Director

KPMG in Portugal

Rita Esteves
Rita Esteves

GMS Tax Manager at KPMG Portugal

KPMG in Portugal

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Disclaimer

The information contained in this newsletter was submitted by the KPMG International member firm in Portugal.

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