Tax Regime
Procedures
Taxation in Somalia
Investors and companies are subject to pay taxes to different levels of government and local authorities. Taxpayers are subject to direct and indirect taxes. Direct taxes include; personal income tax, rental tax, withholding tax, and corporate tax, among others. The main types of indirect taxes are VAT, customs duty, excise, and turnover taxes. Somalia’s main taxes are summarized in the table below:
Taxation Regime
- Income/Payroll Tax
The income is payable to the Federal Government of Somalia under authority of this Appropriation Law and Law No. 5, November 7, 1966.
| Monthly income bracket in (US $) | Tax Rate (%) | Assessment Formula |
| 0-200 | 0 | Exempt |
| 201-800 | 6 | Income above $200 and up to $800 |
| 801-1500 | 12 | Income above $800 and up to $1,500 |
| 1501-over | 18 | Income above $1,501 |
The Corporate Income Tax (CIT) or Company Tax is payable to the Federal Government of Somalia under authority of this Appropriation Law and Law No. 5, November 5, 1966.
| Yearly Income Bracket in (US $) | Tax Rate (%) | Assessment Formula |
| 0-2,399 | 0 | Exempt |
| 2,400-3,600 | 9 | Income above $2,400 and up to $3,600 |
| 3,620-4,800 | 11 | Income above $3,600 and up to $4,800 |
| 4,820-6,000 | 13 | Income above $4,800 and up to $6,000 |
| 6,020-7,200 | 15 | Income above $6,000 and up to $7,200 |
| 7,220-8,400 | 17 | Income above $7,200 and up to $8,400 |
| 8,420-9,600 | 19 | Income above $8,400 and up to $9,600 |
| 9,620-10,800 | 22 | Income above $9,600 and up to $10,800 |
| 10,900-18,000 | 25 | Income above $10,900 and up to $18,000 |
| 18,100-30,000 | 28 | Income above $18,000 and up to $30,000 |
| 30,000-over | 30 | Income above $30,000 |
The Rent Tax is payable to the Federal Government of Somalia under authority of this Appropriation Law and Law No. 5, November 5, 1966.
| Quarterly Income Bracket in (US $) | Tax Rate (%) | Assessment Formula |
| 0-499 | 0 | Exempt |
| 500-20,000 | 15 | Income above $500 and up to $20,000 |
| 20,000-over | 22.5 | Income above $20,000 |
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