IRPS: the end of schedular taxation for individuals

IRPS ends the schedular logic under which each type of income sat in its own statute. The new code absorbs employment income tax, tax on investment income, property tax on rental income and stamp duty under item 23.2. The employment income tax code, approved by Law 18/14, is repealed.

The second fundamental change is scope. Tax residents in Angola will be taxed on worldwide income, while non-residents continue to be taxed only on Angolan-source income. Residence is determined by presence: more than 90 days, consecutive or not, in any 12-month period. Anyone working across borders or receiving income abroad has ground to review here, including the risk of double taxation.

For business and professional activity, Category B offers two routes. With organised accounts, taxable income follows IRPC rules. Under the simplified regime, available to those not exceeding 25 million kwanzas in annual turnover or imports, taxable income is set at 70% of gross turnover. A 6.5% withholding is also foreseen on services provided to entities keeping accounts, as a rule provisional and credited against the final assessment.

The proposal was approved in general terms by the National Assembly and the regime only takes effect once the final law comes into force. That is no reason to wait: choosing between the simplified regime and full accounts, reviewing contracts and assessing the tax residence of key staff are decisions made in advance, not afterwards.

At BDIO we assess the impact of the transition case by case. Talk to us before the change reaches your payroll.