Chad Personal Income Tax

An individual is considered resident in Chad in the following cases:

  • He or she is present in Chad more than 183 days during a fiscal year.
  • He or she has a permanent home in Chad as an owner, usufruc­tuary or tenant.
  • His or her main economic resources are from Chadian sources.

Income subject to tax

Employment income. Individuals are subject to income tax on employment earnings in the following circumstances:

  • They are resident during the time of employment, regardless of whether their duties are performed in Chad or whether the employer is located in Chad.
  • For nonresidents, their employers are resident or have a perma­nent establishment in Chad and the activities are performed in Chad.

It is irrelevant where an employment contract is signed or remu­neration is paid.

Employment income includes directors’ fees and almost all cash and non-cash payments, allowances and benefits arising from employment. Taxable benefits arising from employment include the following:

  • The taxable benefit from employer-provided housing corresponds to 15% of employment income or to the rent value paid by the employer, whichever is less.
  • Motor vehicles. The value of the benefit of an employer-provided motor vehicle is 8% of employment income including any part of the benefit that is paid in cash by the employer.
  • Water and electricity. The taxable benefit equals 6% of employ­ment income.
  • Housekeeping and servants. The taxable benefit equals 4% of employment income.
  • The taxable amount equals 5% of employment income.
  • Gas supplied by the employer. The taxable benefit equals 1% of employment income.
  • The taxable benefit equals 3% of employment income.

Specific exemptions include the following:

  • All pensions.
  • Special allowances granted to employees with respect to charg­es and expenses relating to their function, provided that the amount of such allowances does not exceed 15% of the gross salary including these allowances.
  • Family allowances paid by the employer. The amount of the exemption for such allowances is limited to XAF5,000 per child per month.
  • Unemployment allowances.
  • Scholarship allowances.
  • Severance pay allocated within the framework of a social plan or voluntary departure.
  • Death benefit.
  • For non-citizens recruited outside Chad and their families, the cost of passage with respect to joining the company, annual leave and departure.
  • Transportation allowances paid to all employees.
  • Gratuities paid to employees who receive Labour medals (awards granted to employees for their seniority or the excep­tional quality of their services).
  • Employer-provided stock options if the company’s stock options are granted to all employees.
  • Additional payments made by the company that allow employ­ees to acquire the company’s shares.

Self-employment and business income. All income accrued in or derived from Chad is subject to income tax. For a resident, this includes profits from a business carried on both inside and out­side Chad.

Business income includes income derived from a trade, profes­sion or vocation, as well as from manufacturing or other related operations. A partnership is transparent for tax purposes, with the individual partners taxed on their shares of partnership profits.

Individuals are liable to personal income tax under three tax regimes, depending on their annual earnings. These regimes are described below.

Individuals with annual revenue equal to or less than XAF10 mil­lion from services or XAF20 million from trading businesses are subject to a discharge tax regime. The amount of discharge tax is determined according to the nature and consistency of the busi­ness carried out by the individual. The discharge tax is consid­ered a final payment of tax, and the taxpayer is exempt from any other income tax.

Individuals with annual revenue higher than XAF10 million but equal or less than XAF60 million from service activities and individuals with annual revenue higher than XAF20 million but equal or less than XAF100 million from trading activities are subject to income tax under the simplified taxation regime. Income tax due from individuals under the simplified tax regime is determined by the same method as under the normal tax regime, which is described below.

Individuals with annual revenue higher than XAF60 million or XAF100 million from service activities or trading activities, respectively, are subject to income tax under the normal tax regime. Under this regime, business profits and losses are deter­mined using normal commercial methods, matching expenses with income from similar activities and using the accrual method of accounting.

All individuals who are self-employed and unincorporated busi­nesses must have a 31 December year-end.

Directors’ fees. Directors’ fees paid to resident and nonresident directors are subject to a 20% withholding tax. Other income received by a director is taxable under the appropriate rules. For example, a director receiving a salary from an effective employ­ment relationship with the company is subject to payroll taxes with respect to the portion of his or her income corresponding to the salary.

Investment income. Dividends and interest income from invest­ments in Chad are subject to a final withholding tax in the year received. For residents, the tax rate is 20% on dividends and interest. For nonresidents, the tax rates are 20% on dividends and 25% on interest.

The following are the principal types of exempt investment income:

  • Interest derived from savings accounts held with agricultural banks or associations
  • Interest derived from Treasury bills with up to five years of maturity
  • Interest derived from savings accounts held with cooperatives, up to XAF5 million
  • Interest derived from home ownership savings plans
  • Interest derived from savings accounts held with the Post Office Savings Bank, up to XAF5 million
  • Interest derived from deposit notes with an interest rate of up to 6% held with financial institutions

Rental profits are aggregated with profits from other sources and taxed at the rates set forth in Rates.

Winnings from betting and gaming. Payments relating to win­nings from betting and gaming in Chad are subject to a final withholding tax in the year received. The applicable tax rates are 20% for residents and 25% for nonresidents.

Capital gains. Capital gains derived from transfers, exchanges, sharing, compulsory purchases, capital subscriptions or company settlements with respect to movable or non-movable assets are subject to a final withholding tax at a rate of 20%.

Deductions and reliefs. Individuals not resident in Chad for tax purposes are not entitled to any deductions or credits.

Resident individuals may deduct the following expenses in com­puting taxable income:

  • Interest on borrowings to finance investments in property.
  • Arrears paid to ascendants or descendants or the value of col­lateral with respect to such borrowings, up to a maximum of XAF600,000 per year.
  • Payments under a court decision as a result of separation or divorce. If the procedure is pending in court, an additional con­dition is that the spouse be taxed separately.

Rates. Progressive income tax rates are applied to resident and nonresident individuals’ annual global taxable income (including employment income and self-employment or business income). The following are the rates.

Taxable income (XAF)
Exceeding Not exceeding Rate
    %
0 300,000 20
300,000 800,000 25
800,000 1,000,000 30
1,000,000 1,500,000 40
1,500,000 2,000,000 45
2,000,000 3,000,000 50
3,000,000 6,000,000 55
6,000,000 60

 

Tax is withheld from payments to nonresidents at the following rates.

Income category Rate (%)
Dividends 20
Interest 25
Management and professional fees, training fees, royalties and performance fees 25
Rental of movable property 20
Use of other property 25
Pensions and retirement annuities 0
Telecommunication service fees 25

 

These rates normally constitute the final liability for Chadian income tax.

Relief for losses. Tax-adjusted profits and losses from the follow­ing specified sources must be categorized separately:

  • Income derived from buildings and land without buildings
  • Income derived from industrial, agricultural and commercial activities
  • Non-commercial profits
  • Revenue from employment activities
  • Capital gains
  • Investment income

Losses may be carried forward to offset future profits from the same specified source without monetary limits. They may be used in the income year in which they arise and in the following four years, or five years for revenue from land. Losses may not be carried back.

Other taxes

Tax on buildings. The rates of the tax on buildings are 10% in Ndjamena and 8% in other towns. The tax base is 8% of the value of the building, after a deduction of 50% in consideration of maintenance fees.

Tax on unbuilt property. The rates of the tax on unbuilt property are 21% in Ndjamena and 20% in other towns. The tax rate applies to a portion of the rental value of the property. The rental value equals 10% of the estimated market value of the property.

Tax on rental premise. Progressive income tax rates are applied to monthly rent paid. The rates vary depending on whether the land­lord is a resident or a nonresident. The following are the rates.

Taxable income (XAF) Rate
Exceeding Not exceeding Residents Nonresidents
% %
0 1,000,000 15 20
1,000,000 4,000,000 20 25
4,000,000 25 30

 

Social security

The only social security tax levied in Chad is the National Social Insurance Fund (NSIF) tax. The NSIF is a statutory savings scheme that provides for retirement, professional injury risks and family allowances. Local and foreign employees must register with the NSIF. Employees must contribute to the NSIF at a rate of 3.5% of gross salary, including all earnings in cash or in kind, up to XAF500,000 per month. Employers must contribute at a rate of 16.5% of gross salary, up to XAF500,000 per month. The employer is responsible for payment to the NSIF of both the employer and the employee contributions.

Chad has not entered into any bilateral or multilateral convention to prevent double taxation from a social security perspective. However, Chad is a member of the Inter-African Conference of Social Welfare (Conférence Interafricaine de la Prévoyance Sociale, or CIPRES), which has the exclusive objective of improving the management of social security within African countries.

Tax filing and payment procedures

Employee withholding. Tax is withheld from employees’ income on a monthly basis. The employer must file a monthly wage with­holding declaration provided by the tax authorities. The tax dec­laration must be sent, together with the tax payment, to the tax authorities by the 15th day of the month following the month of payment to the employees.

Installment tax. Individuals must make an installment payment by the 15th day of each month, based on the turnover of the pre­ceding month. However, individuals whose income consists only of employment income and income from movable capital that is taxed at source are not required to pay installment tax.

Final return. Resident individuals are required to file a self-assessment return by 1 March following the end of the preceding calendar year.

Employers must file an annual statement of salaries by 31 January following the end of the preceding year.

Married couples. Married women may either file self-assessment returns with respect to their income from all sources or aggregate their income with the income of their husbands in the case of matrimonial division of property and judicial separation.

Double tax relief and tax treaties

Chad has only entered into the Central Africa Economic and Monetary Union (Communauté Economique et Monétaire de l’Afrique Centrale, or CEMAC) double tax treaty, dated 13 December 1986, together with Cameroon, Central African Republic, Congo (Republic of), Equatorial Guinea and Gabon.

Temporary visas and passes

All visitors other than nationals from CEMAC and the Community of Sahel-Saharan States (Communauté des Etats Sahélo-Sahariens, or CEN-SAD) must obtain visas to enter Chad. CEMAC includes only the countries listed in Section E, while CEN-SAD comprises Benin, Burkina Faso, Central African Republic, Chad, Comoros, Côte d’Ivoire, Djibouti, Egypt, Eritrea, Gambia, Ghana, Guinea, Guinea-Bissau, Kenya, Liberia, Libya, Mali, Morocco, Mauritania, Niger, Nigeria, São Tomé and Príncipe, Senegal, Sierra Leone, Somalia, Sudan, Togo and Tunisia.

A resident permit is mandatory for all visitors, including those from CEMAC and CEN-SAD countries, after a stay of three consecutive months in Chad. The resident permit expires one year after its delivery date.

Visas are obtained from the Chadian embassy or from the Emigration and Immigration Directorate (Direction de l’Emigration et l’Immigration) for visitors from areas that do not have a Chadian embassy. Foreign nationals wishing to visit Chad should confirm the entry requirements before departing from their home countries.

Temporary visas are usually granted without delay. They are issued for a maximum period of three months and are not renew­able. A foreign national wishing to stay in Chad for longer than three months must obtain a long-stay visa.

The following types of temporary visas are issued:

  • Transit visa, which is issued to individuals on transit and is valid for a maximum of 15 days. A fee of approximately USD70 is payable on application.
  • Ordinary or single-entry visa, which is issued to visitors, including tourists, making single trips to Chad for a maximum of three months. A fee of approximately USD100 is payable on application.
  • Multiple-entry visa, which is issued to foreign nationals, such as businesspersons, expecting to make several trips to Chad. The multiple-entry visa may be a short-term visa with a maxi­mum stay of three months in Chad or a long-term visa with a maximum of one year in practice. A fee of USD100 is payable on application.
  • Diplomatic visa, which is issued free of charge to holders of diplomatic passports on official business.
  • Official or service visa, which is issued free of charge to holders of official or service passports on official visits.

Work permits and self-employment

Work permits must be obtained before beginning work in Chad. Employers obtain the permits on behalf of foreign workers. Only one type of work permit is available in Chad. Employers are required to justify employing a foreign national instead of a Chadian. If the foreign national changes employment, his or her new employer is responsible for obtaining a new work permit.

A foreign national wishing to carry out business in Chad must make a declaration to the immigration authorities before the start-up of the business. In some limited cases, a foreign national must obtain required licenses and registrations and must have sufficient capital or resources for investment.

Residence permits

Foreign nationals wishing to reside in Chad must have a resident permit. A resident permit is valid for a maximum of one year from the delivery date. This permit is renewable for an unlimited number of times for up to one year at a time.

The Chadian National Immigration Office issues resident per­mits. The application process takes one to two weeks.

Family and personal considerations

Vaccinations. Individuals entering Chad must have international immunization certificates.

Family members. Family members of resident permit holders are entitled to resident permits. Dependents wishing to take up employment must obtain separate work and resident permits.

Marital property regime. Chadian law provides for a community property regime or a similar marital property regime, as well as for a separate property regime.

Driver’s permits. Holders of international or CEMAC driver’s licenses may drive in Chad without any further formality. They may also obtain Chadian driver’s licenses on application. Holders of driver’s licenses other than the CEMAC or international licenses are required to obtain Chadian driver’s licenses. A for­mal examination is required.