SIGNIFICANT DEVELOPMENTS
There have been no significant tax or regulatory developments regarding individual taxation in the past year.
TERRITORIALITY AND RESIDENCE
Cameroon tax residents are subject to personal income tax on their worldwide income unless excluded by a tax treaty. Nonresidents are taxable on their Cameroon-source income.
All persons who have any of the following in Cameroon are considered tax residents.
1.Place of abode as owner, tenant, or life tenant.
2.Principal place of residence.
3.Center of their economic interests or business affairs.
GROSS INCOME
Employee gross income/ Taxable income includes all cash remuneration, including living and housing allowances and bonuses. It also includes in-kind benefits such as housing, electricity and water, car domestics, and food. In-kind benefits are valued as follows (as a percentage of gross
income): housing-15%; electricity-4%; water-2%; per car-10%; per domestic servant-5%; and food-25% per person, up to a maximum of CFAF50,000 per month, children under 15 counting for one-half. Special allowances inherent to employment function or duties are nontaxable if they genuinely serve their
purpose and are not exaggerated.Capital gains and investment income/ Capital gains are taxable only if the recipient or the recipient’s spouse, ascendants, or descendants exercise
or have exercised during the last five years preceding the transfer a management function in the company whose shares are transferred and if, during the same period, the rights of said persons have exceeded 25% of the profit earned. Such capital gains are liable to a deemed tax at a rate of 20%.
Capital gains resulting from the transfer of developed or undeveloped property that are realized by individuals off balance sheet are subject to a lump-sum tax withheld by the notary.Dividend income is subject to proportional tax on income from securities (taxe proportionelle sur les revenus de capitaux mobiliers-TRCM) at 16.5% for recipients resident in Cameroon, 15% for French residents, or 25% for nonresident recipients. Interest income is subject to a 16.5% withholding
tax, except if paid to a nonresident, in which case it is not taxable.The net income from dividends and interest is subject to a graduated surtax. The amount withheld is deductible from the income liable to graduated surtax.
DEDUCTIONS
Business deductions/ Professional expenses are deemed to be 20% of gross income and are deductible for proportional tax calculation purposes.Nonbusiness expenses/ For the graduated surtax calculation, the following are deductible: loan interest, financing costs for the purchase in Cameroon
of one’s personal domicile and of stocks in newly set up businesses, mandatory annuity payments, insurance premiums (under certain conditions), contributions to pension funds(limited to 10% of taxable salary), social security contributions to the National Social insurance Fund, business
expense reimbursements, and all taxes paid by the taxpayer except the graduated surtax.Personal allowances/ The number of a taxpayer’s dependents does not affect proportional tax on salaries but is taken into account for graduated surtax
calculation purposes.Tax creditsNo specific tax credits are available to short-term residents.Residents are entitled to tax credits for withholding tax paid in Cameroon and tax treaty countries. Cameroon has tax treaties with Canada, France,
and the Central Africa Customs Union (UDEAC) countries.
Other tax credits/ A5% credit is withheld on purchases. Any purchase made by a manufacturer, importer, wholesaler, or forester is decreased by 5% of the amount of the purchase. The total amount of 5% on purchases paid during the fiscal year by the purchaser constitutes an advance payment of income
tax for persons with commercial businesses.Cameroon radio/ television allowance either is paid annually, simultaneously
with business license tax for persons with commercial businesses, or is withheld by the employer from employees. This is not a tax burden but an advance payment of individual tax to be deducted from the final individual tax due for the fiscal year.
OTHER TAXES
Housing fund tax/ Employers must pay housing fund tax (credit foncier) at a rate of 1.5% on the items of income paid to employees, excluding in-kind benefits.Employment fund tax/ Employers must pay employment fund tax (fonds national
pour I’emploi) at a rate of 1% on the items of income paid to employees, including real amounts of n-kind benefits.
Television allowance/ Employees contribute to finance Cameroon television according to a fixed scale, depending on monthly taxable income. This allowance should not be considered a tax burden, since the payments may be offset against the final incom
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