Know Your Tax Code – Personal Income Tax In Cameroon

Are you planning to start a business in Cameroon? Do you work or live in Cameroon? Taxation may affect everyone who lives or has anything to do in Cameroon. Any person carrying out any income generating activity in Cameroon has to pay income tax. The personal income tax in Cameroon is a direct tax levied on the incomes of natural persons carrying out activities in Cameroon. Get a preview of Cameroon tax administration and what it takes to start a business in Cameroon.

Tax base for PIT and assessment in Cameroon

The taxation for personal income in Cameroon includes the overall net income made by the taxpayer through out the fiscal year after a fixed deduction of 500,000FCFA. The overall net income includes all net incomes earned from the different categories. See categories below.

The personal income tax rate in Cameroon ranges between 10% to 35%. The tax due can be obtained by using the scale below of the total rounded income of the tax payer:

10% ==> from 0 ==> 2,000,000

15% ==> from 2,000,001 ==> 3,000,000

25% ==> from 3,000,001 ==> 5,000,000

35% over 5,000,000

NB: Cameroon’s currency is the Central African Franc CFA (XAF). It is pegged to the Euro at XAF655.9570 = 1 Euro.

Taxable Individuals

Those liable to pay the personal income tax in Cameroon are natural persons whose fiscal domicile is in Cameroon. That is, they earn their income from activities carried out in Cameroon. Some sources included:

=> Farmers, traders and craftsmen;

=> Landlords;

=> Wage/salary earners, pensioners and annuitants;

=> Those in liberal professions like lawyers, auditors, etc

Income categories liable to personal income tax in Cameroon

Income categories liable to personal income tax in Cameroon

The personal income categories includes:

=> Wages, salaries, pensions, annuities,

=> Income from capital,

=> Land revenue,

=> Profits from the activities of craftsmen, traders, farmers and those of the liberal professions and other related revenue.

Tax exemptions in relation to personal income tax in Cameroon

Tax exemptions in Cameroon in relation to PIT depends on the income categories. The income categories that are exempted include:

=> Monthly wages that are less than 62,000FCFA

=> Cash voucher interests

=> Savings account interests for placements less than or equal to 10,000,000FCFA

=> Scholarships

=> Bonds issued by companies

=> Total net profits of less than 500,000FCFA on share transfers, bonds and other capital investments by individuals

Read Also:Want To Start An Import-Export Business In Africa? You Need To Read This First

Tax returns

The tax payers are obliged to file in their tax returns before March 15 every year. The tax return must show in detail the individuals earnings for the previous fiscal year.

Important to note

=> Wage earners that have no other source of income are exempted from filing tax returns at the end of the year

=> Any person paying revenue in the form of salary, wage, indemnity, emolument, pension or life annuity must make deductions provided the activity is carried out in Cameroon.

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Related: Small Business taxation in Cameroon – Discharge tax

=> Deductions at source are made only on salaries greater than 62,000FCFA. Those earning revenue less than this ceiling are exempted from such deductions.

=> Employers are obliged to deposit the amount deducted in the Public Treasury on or before the 15th of the month following the one which the salary was paid.

Are you planning to start a business in Cameroon? We can be of help in all your business development needs in Cameroon. Checkout this posts on how to start a limited liability company in Cameroon if you plan to open one. You can also checkout how to start a sole proprietor business in Cameroon.

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