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Botswana: Domestic Corporate Taxation

Withholding Tax

This page was last updated on 8 May 2019.

Dividends: since July 2011, a 7.5% withholding tax rate has been payable on dividends paid to both residents and non-residents, unless the withholding tax rate is varied by a double taxation avoidance agreement.

Interest: rate is 15% on interest paid to non-residents. For residents, the rate is 10% on amounts greater than BWP500 in one month, BWP1500 in a quarter or BWP6000 in a  year.

Commercial royalties: 15% tax to non-residents for use of or rights to patents, trade-marks, copyrights, secret formulas and industrial, commercial or scientific equipment or information.

Management or consultancy fees: 15% on payment to non-residents.

Entertainment fees: 10% on payments to non-resident entertainers.

Construction contracts: the commissioner of taxes must be informed of all non-resident contracts relating to construction contracts which amount to more than BWP5,000.00. Payments under such contracts are subject to a withholding tax of 3%.

In the case of all other withholding taxes, the tax withheld is the final tax. Non-residents need not file tax returns if they have no other income.

Amendments to the Income Tax Act passed in 2004 include a tighter definition of the 3% withholding tax charged on construction contracts in order to combat evasion of the levy in the sector, and the removal of the exemption from the 15% withholding tax on dividends for associated companies (a firm where the parent company holds more than 20% of its stock.)

 

 

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