Taxation

Taxation in Botswana is governed by the Income Tax Act of 2019, which replaced the previous Income Tax Act of 2004. The tax system in Botswana is administered by the Botswana Unified Revenue Service (BURS).

Personal income tax is levied on all individuals who are residents of Botswana. The tax rates are progressive, ranging from 5% to 25%, depending on the income level. The first BWP 36,000 of annual income is exempt from taxation, and there are various deductions and credits available to reduce the tax liability. Non-residents of Botswana are subject to a flat tax rate of 15% on income earned in Botswana.

Corporate income tax is levied on all companies and businesses operating in Botswana. The standard corporate tax rate is 22% on the net taxable income. However, certain businesses such as manufacturing, tourism, and certain agricultural activities may be eligible for tax holidays or reduced tax rates under certain circumstances.

The tax year in Botswana runs from July 1st to June 30th. The deadline for filing personal income tax returns is November 30th of the following year, while the deadline for filing corporate tax returns is generally six months after the end of the accounting period. Taxpayers are required to make advance tax payments on a monthly or quarterly basis, depending on the level of taxable income.

Payments can be made online or in person at designated banks. The penalty for late payment or non-payment of taxes can range from 10% to 200% of the tax due, depending on the severity of the offense. Additionally, interest may be charged on any outstanding tax liability.

Overall, taxation in Botswana is relatively straightforward, with reasonable tax rates and a well-established tax administration system. The government has taken steps in recent years to simplify the tax system and make it more user-friendly for taxpayers.