Personal income tax rates in Gambia are progressive up to 35%.
Income range per annum Tax rate
0 - GMD 7, 500 Exempt
GMD 7, 501 - GMD 17,500 10%
GMD 17, 501 - GMD 27,500 15%
GMD 27, 501 - GMD 37,500 20%
GMD 37,501 - GMD 47,500 25%
GMD 47,501 and above 35%
Basis - Gambian residents are taxed on their worldwide income; nonresidents are taxed only on their Gambian-source income.
Residence - An individual is resident if he/she spends 183 days of the tax year in Gambia, has an aggregated presence of 183 days in a tax year or owns a dwelling in Gambia.
Filing status - Each individual must file a return if so required; joint filing is not permitted.
Taxable income - Income is taxed under a schedular system. Employment income, including most employment benefits, is taxable. Profits derived from carrying on of a trade or profession generally are taxed in the same way as profits derived by companies.
Investment income in the form of dividends is subject to tax at source at the rate of 15%.
Capital gains - Capital gains tax is the greater of 5% of the consideration or 15% of the net gain.
Tax Deductions and tax allowances - Retirement benefits to approved pension funds may be deducted up to a maximum of 25% of gross income reduced by the employer's contributions. There are no personal allowances.
Corporation tax is payable based on the higher of 35% of chargeable profit or 2% of total turnover for the tax year. This implies that, even if a company makes a loss or has an adjusted tax loss figure for any particular year, it will still be liable to tax. Note that, if for any reason, a company is not audited, tax on that company's total turnover will be 3% and not 2%.
Income tax is payable in quarterly instalments i.e. the three month period ending on the last day of the third, sixth, ninth and twelfth months of the taxpayer's tax year. This instalment is based on 2% of total turnover for a company with audited accounts or 3% for a company without audited accounts and is due by the 15th of the following month, failing which a penalty equal to 5% of the unpaid tax per month can be applied. The advance payments during the fiscal year are creditable against the income tax assessed.
The Corporate Income Tax Return is mandatory for all companies and should be submitted by 31 March of each year. The form is used to determine annual tax liability.
CAPITAL GAINS TAX
This is payable on the disposal of a capital asset. In the case of a partnership, company or trustee, tax is paid on the greater of:
(i) 25% of the capital gain arising on disposal or
(ii) 10% of the consideration received for the disposal
In the case of an individual, body of persons or trustee of a deceased estate:
(i) 15% of the capital gain arising on percentage of the disposal or
(ii) 5% of the consideration received on disposal.
Capital gains tax is exempt on the disposal of agricultural land, a private residence and if the amount gained does not exceed GMD 7,500.
BRANCH PROFITS TAX
A branch's profit is taxed at the higher of the 35% on profit or 2% of income as the branch is a permanent establishment meaning a resident company.
FRINGE BENEFITS TAX
Fringe benefits are specific and direct payments of expenditure for and on behalf of an employee in addition to his /her salary. The total amount of fringe benefit plus tax thereon is an allowable deduction for the purposes of corporate tax calculation. The tax levied is at a rate of 35% on the grossed-up taxable value of each benefit provided and is payable by the organisation that provides the benefit to the employee.
National Educational Levy: If the total income of a company exceeds GMD5 million per annum the levy applied is GMD 50,000 and if below GMD 5 million, a flat tax rate of GMD 30,000 is applied.
Business Registration: An annual payment of GMD500 should be made by all businesses at the start of the year.
Stamp Duty: The duty is levied on juristic acts resulting to a flow of wealth between the parties involved legally. Thus, stamp tax is applicable inter alia to acts whereby transactions on Real Estate or financial obligations are documented. Rates vary according to the type of transaction involved.
Customs & Excise Duties: Is applied on the importation or exportation of certain goods.
Residential Rent Tax: Tax is imposed for each tax year on a person who has a taxable rental amount at a rate of 10% per annum.
DETERMINATION OF TAXABLE INCOME
The calculation of taxable income is arrived at by adjusting the accounting profits for non-taxed income and disallowed expenses.
The following annual rates are applied against the written down value of assets (Annual allowance):
- Building 5%
- Motor Vehicle 40%
- Plant and machinery 20%
- Plant and machinery used in manufacturing, mining 30%
- Office furniture and equipment 20%
Initial allowance is applied at 20% of the cost of the asset or 10% for building, structures or works of permanent nature.
Initial and annual allowance cannot be granted on the same asset in the same year. Therefore, annual allowance is not granted in the year a fixed asset is first put to use only initial allowance is granted.
An amortisation deduction is allowed. The deduction is computed by using the cost of the asset divided by the useful life of the intangible asset in whole years.
No deduction is allowed in the tax computation but rather capital allowances are allowed.
A deduction is allowed for the cost of stock in trade disposed of in a tax year in deriving the chargeable income.
CAPITAL GAINS AND LOSSES
If the consideration received exceeds the written down value of the asset, the excess is business income which has to be included in the person's income for that year and if less the difference is allowed as a deduction when computing the chargeable income for the year.
Dividends are taxable under the withholding tax section.
A deduction is allowed for any interest incurred in a tax year if the company used the proceeds or benefit of the debt on which the interest is payable. The interest not deducted can be carried forward for a period of six years.
If a company has a business loss for the year that amount is carried forward to the following year and allowed a deduction in computing the chargeable income for that year. Losses can only be carried forward for six years after the tax year in which the loss is incurred.
FOREIGN SOURCED INCOME
A foreign sourced income received by a resident company is exempt from income tax if foreign income tax has been paid, a tax credit is allowed.
Expenditure on certain pre-commencement expenditure qualifies for accelerated deductions. A deduction is allowed in the tax year which the expenditure is incurred and in the following three years at a rate of 25% each year.
Bad debts: A deduction is allowed for a debt written off if certain conditions are satisfied.
Loss reserve of banks: A bank is allowed a deduction for the addition to its provision for doubtful debts in a tax year, provided the addition has been determined in accordance with the prudential requirements specified by the Central Bank of the Gambia.
The amount allowed as a deduction for a tax year shall not exceed a half of one percent (0.5%) of the total outstanding debt claims of the bank as at the end of the tax year. Granting of investment incentives and tax exemptions can only be obtained from the Gambia Investment Promotion and Free Zones Authority (GIPFZA).
FOREIGN TAX RELIEF
The Government of The Gambia has a double taxation treaty with Norway, Sweden, Switzerland, Taiwan and the United Kingdom.
If a resident person has a foreign tax loss for a tax year, the amount of the loss can be carried forward to the following tax year and allowed as a deduction against the person's foreign sourced business income. The loss can be carried forward for a period of six years.
Tax on certain payments to non-resident persons does not apply if the conditions below are met:
(i) If the holding giving rise to the dividend is connected with a permanent establishment in The Gambia of a non-resident company
(ii) Any interest if the debt claim giving rise to the interest is connected with a permanent establishment in The Gambia of a non-resident company
(iii) Any royalty if the property or right giving rise to the royalty is effectively connected with a permanent establishment in The Gambia of a non-resident company
(iv) Any technical service fee if the services giving rise to the fee are rendered through a permanent establishment in The Gambia of a non-resident company.
A person who retains the services of a contractor or subcontractor to carry out work or supply labour or materials for the carrying out of work shall withhold tax at the rate of 10% of the gross fees.
A company or partnership paying dividend to a resident individual shall withhold tax at the rate of 15%.
A 15% withholding tax shall be withheld on interest paid to resident companies but it does not apply to interest paid to financial institutions. Currently, this law is not being applied.
There are no exchange controls in effect.
There is no VAT in the Gambia but sales tax is imposed on:
(a) A taxable supply of goods
(b) A taxable supply of services
(c) A taxable import.
RATES OF TAX
(a) 18% for a taxable supply of telecommunications services
(b) 15% for manufacturing and shipping agency services
(c) 15% for imported construction materials
(d) 10% for any other case.
A person who is obliged to register under subsection 1 shall apply to the
Commissioner General for registration within 21 days of becoming obliged.
Income Tax Rate
Corporate Tax Rate
Sales Tax / VAT Rate
Last Update: Nov 2010
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