Impact on International Entities & Permanent Establishments (PE)
: The threshold has been raised to ETB 10,000 per contract (previously ETB 3,000).
Navigating Ethiopian tax compliance requires utilizing authoritative resources from official ministerial and legal repositories.
For those interested in reading the withholding tax proclamation in Ethiopia in its entirety, the document can be downloaded in PDF format from the Ethiopian government's website or other online sources. The PDF document provides a comprehensive overview of the withholding tax system in Ethiopia, including the key provisions, tax rates, and withholding tax returns.
: The WHT rate on domestic payments for goods and services has increased from 2% to 3% . Revised Thresholds :
: Consider using compliance software that integrates with your accounting system. It can automatically apply the correct WHT rates based on transaction types and supplier details, significantly reducing manual errors.
Under the new proclamation, withholding tax is applied to various payments made to both residents and non-residents. The standard rate for domestic supply of goods and services has been increased to encourage formal business documentation. Payment Category Resident Rate Non-Resident Rate Conditions/Thresholds Above ETB 20,000 Supply of Services Above ETB 10,000 Dividends Revised from 10% Interest Revised from 5% Royalties 5% – 10% 5% for art and culture Digital Content For non-professional creation No TIN Provided Applied if supplier lacks valid TIN Key Changes in the 2025 Amendment
A new Minimum Alternative Tax of applies if the calculated income tax falls below this threshold, even for companies enjoying tax incentives.
You can find the official PDF version of the Withholding Tax Proclamation in Ethiopia on the Ethiopian Tax Administration website or other government websites.
:
Any resident of Ethiopia or a permanent establishment in Ethiopia making a payment to a non-resident for items such as dividends, repatriated profits, interest, royalties, management fees, or technical fees is required to withhold tax. The tax is applied to the gross amount paid at the rate specified in the Proclamation for non-resident income.
Withholding tax must be deducted by the payer if the transaction value per contract exceeds these limits: Supply of Goods: ETB 20,000. Supply of Services: ETB 10,000. Non-TIN Suppliers:
Impact on International Entities & Permanent Establishments (PE)
: The threshold has been raised to ETB 10,000 per contract (previously ETB 3,000).
Navigating Ethiopian tax compliance requires utilizing authoritative resources from official ministerial and legal repositories.
For those interested in reading the withholding tax proclamation in Ethiopia in its entirety, the document can be downloaded in PDF format from the Ethiopian government's website or other online sources. The PDF document provides a comprehensive overview of the withholding tax system in Ethiopia, including the key provisions, tax rates, and withholding tax returns. withholding tax proclamation in ethiopia pdf best
: The WHT rate on domestic payments for goods and services has increased from 2% to 3% . Revised Thresholds :
: Consider using compliance software that integrates with your accounting system. It can automatically apply the correct WHT rates based on transaction types and supplier details, significantly reducing manual errors.
Under the new proclamation, withholding tax is applied to various payments made to both residents and non-residents. The standard rate for domestic supply of goods and services has been increased to encourage formal business documentation. Payment Category Resident Rate Non-Resident Rate Conditions/Thresholds Above ETB 20,000 Supply of Services Above ETB 10,000 Dividends Revised from 10% Interest Revised from 5% Royalties 5% – 10% 5% for art and culture Digital Content For non-professional creation No TIN Provided Applied if supplier lacks valid TIN Key Changes in the 2025 Amendment The PDF document provides a comprehensive overview of
A new Minimum Alternative Tax of applies if the calculated income tax falls below this threshold, even for companies enjoying tax incentives.
You can find the official PDF version of the Withholding Tax Proclamation in Ethiopia on the Ethiopian Tax Administration website or other government websites.
:
Any resident of Ethiopia or a permanent establishment in Ethiopia making a payment to a non-resident for items such as dividends, repatriated profits, interest, royalties, management fees, or technical fees is required to withhold tax. The tax is applied to the gross amount paid at the rate specified in the Proclamation for non-resident income.
Withholding tax must be deducted by the payer if the transaction value per contract exceeds these limits: Supply of Goods: ETB 20,000. Supply of Services: ETB 10,000. Non-TIN Suppliers: