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Hiring in Angola
Angola, officially known as the Republic of Angola, is located in Southern Africa. Angola is rich in natural resources such as Diamonds, Oil, Gold and Copper. It’s primary trading partner is China. Global PEO or Employer of Record (EOR) play a pivotal role in providing companies with services related to hiring employees, and ensuring compliance with Angola’s legal and tax regulations. Employment regulations including probation period, holidays and termination are stipulated in Angola’s Labor Code. For instance, Angolan employees are generally entitled to 22 days of vacation per year. Global PEO’s act as the official employer of record (EOR) and thus ensure foreign companies operating in Angola are compliant with the Labor Code. Angola’s personal income tax (PIT) code segments income into 3 groups i.e. employees, self-employed workers, and industrial or commercial employees. These groups are subjected to different tax rates. Global PEO’s ensure compliance with Angola’s tax regulations.
statutory labor requirements
Probation Period
- Unlimited employment contracts generally have a probation period of 60 days.
Annual Leave
- Angolan employees are generally entitled to 22 days of vacation per year.
- Employees with children are entitled to an additional vacation day per year until the child reaches the age of 14.
Public Holidays
- New Year's Day (1st January)
- Liberation Movement Day (4th February)
- Carnival (25th February)
- International Women's Day (9th March)
- Day of the Liberation of Southern Africa (23rd March)
- Peace Day (6th April)
- Good Friday (10th April)
- Labor Day (1st May)
- National Heroes' Day (in Angola) (17th September)
- All Souls Day (2nd November)
- Independence Day (of Angola) (11th November)
- Christmas Day (25th December)
Maternity Leave
- Female employees are entitled to three months of maternity leave, four weeks to be taken before the due date and the balance after, with 9 weeks after guaranteed, regardless of the due date.
- If there are multiple births, the mother is entitled to an additional four weeks.
- The employee may not return to work until at least 5 weeks after the birth.
- Employees on maternity leave are generally entitled to social security compensation, with supplementation by the employer.
Paternity Leave
- There is no statutory paternity leave.
Sick Leave
- Employees may take unlimited days off of work for illness as long as they present a medical certificate.
- Medium and large companies must pay medical leave at 100% of the employee’s salary for the first two months. The third through the 12th months must be paid at 50% of base salary.
Work Hours
- The normal working week in Angola is 44 hours with each day limited to 8 hours.
- The work week can be extended to 54 hours or 9 hours per day.
Overtime
- Overtime is limited to:
- 2 hours per normal day of work
- 40 hours per month of work
- 200 annual hours
- Overtime of up to 30 hours per month is paid at an additional 50% rate.
- Additional overtime is paid at an additional 75%.
Notice Period
- For fixed-term employment contracts, employers must serve employees with two weeks' prior written notice before their contract expires.
- Further, a 30-day notice period applies to individual termination for objective reasons and a 60-day notice period applies to collective dismissal.
Severance
There is no severance pay13th / 14th Month Pay
- Yes (Mandatory)
- There is a statutory requirement to pay holiday bonus equivalent to 50% of the base salary.
- There is a mandatory 13th month vacation bonus which is paid before the holiday.
- And there is a mandatory Christmas Bonus which is paid in December.
income tax
- The PIT Code foresees, with the respective specificities, the segmentation of income into Groups, namely:
- Group A: Generally applicable to the income earned by employees.
- Group B: Income earned by self-employed workers.
- Group C: Income earned by individuals carrying out an industrial or commercial activity listed in the minimum profits table in force, attached to the PIT Code.
- Self-employed workers (Group B) are taxed at a flat rate of 15%.
- This 15% tax rate is applicable to 70% of the gross income (resulting in an effective rate of 10.5%).
- Individuals carrying out an industrial or commercial activity (Group C) are taxed at a flat rate of 30% or 6.5%, as explained below:
|
Taxable income |
Rate (%) |
|
Amount of profits established in the minimum profits table and individuals with organized accounting. |
30 |
|
Amount of sales of goods and services (not subject to withholding) when the taxpayer has turnover in excess of four times of the maximum value established in the minimum profits table. The income received from the provision of services subject to withholding under the Corporate Income Tax (CIT) Code to corporate persons or individuals with organized accounting is subject to 6.5% PIT withholding tax (WHT) (this WHT is regarded as a final tax). |
6.5 |
- For Group A, there are progressive income tax rates up to 17%, as follows:
|
Income (AOA) |
Payable tax (AOA) |
|
Up to 34,450 |
Exempt |
|
Between 34,451 and 35,000 |
The excess of 34,450 |
|
Between 35,001 and 40,000 |
550 + 7% upon the excess of 35,000 |
|
Between 40,001 and 45,000 |
900 + 8% upon the excess of 40,000 |
|
Between 45,001 and 50,000 |
1,300 + 9% upon the excess of 45,000 |
|
Between 50,001 and 70,000 |
1,750 + 10% upon the excess of 50,000 |
|
Between 70,001 and 90,000 |
3,750 + 11% upon the excess of 70,000 |
|
Between 90,001 and 110,000 |
5,950 + 12% upon the excess of 90,000 |
|
Between 110,001 and 140,000 |
8,350 + 13% upon the excess of 110,000 |
|
Between 140,001 and 170,000 |
12,250 + 14% upon the excess of 140,000 |
|
Between 170,001 and 200,000 |
16,450 + 15% upon the excess of 170,000 |
|
Between 200,001 and 230,000 |
20,950 + 16% upon the excess of 200,000 |
|
More than 230,001 |
25,750 + 17% upon the excess of 230,000 |
deductible expenses
Employment Expenses
- The 8% social security contributions (supported by the employee) are allowed as a deduction to the taxable income for PIT purpose of the employee.
Business deductions
- No business deductions are allowed for employees.
- For self-employed workers and individuals carrying out a commercial or industrial activity, business related expenses are allowed as a deduction to the taxable income, within certain limits.
|
Deductible Expenses |
|
|
Employment Expenses |
|
|
Business deductions |
|
immigration
- In line with the new legal regime for foreign nationals in Angola, various types of temporary visas may be granted to foreign nationals who intend to come to Angola.
- The type of visa depends on the reason and period of stay.
- The Tourism Visas are granted by Consular Missions at the applicant’s country of origin or residence, for business prospection or family reasons and for engaging in scientific and technologic activities, as well to those foreign nationals who intend to stay in Angola for recreational, sporting or cultural activities.
- Tourism Visas allow its holder to stay in the country for 30 days, extendable twice for the same time period.
- Tourism Visas do not allow their holders to perform remunerated activities in the country, for which a Work Visa is required, or apply for residence.
- Temporary Stay Visas, which are granted for 365 days, extendable for the same time period, until the end of the term of the reason that justified the visa, may be granted in the following circumstances:
- To accomplish missions within religious institutions or within nongovernmental organizations
- For scientific research, mobility or university extension
- To family members of study, medical treatment and work visa holders
- To family members of holders of valid residence permits
- To spouses of Angolan citizens
- The appropriate visa allowing a foreign national to undertake remunerated activities in Angola is the Work Visa.
- The Work Visa is granted for 365 days, extendable for equal time periods until the end of the term of the employment agreement that justified the visa.
- The Work Visa must be applied for at the Angolan Consulate or Embassy in the applicant’s country of origin or residence.
- Before applying for a Work Visa, a favorable opinion from the entity overseeing the sector of activity in Angola is required.
|
Type of Visa/ Permit |
Documentation |
Validity |
Eligibility |
|
Tourist Visa |
|
30 days |
|
|
Temporary Stay Visa |
|
1 year |
|
|
Work Visa |
|
1 year |
|
value added tax (vat)
- From 1 October 2019 onwards, VAT entered into force in Angola, and the consumption tax was revoked.
- The Angolan VAT system is a modern regime with a rate of 14% and a broad tax base.
|
VAT |
|
|
Standard Rate |
14% |
withholding tax
- Under domestic law, dividends paid to non-resident companies are subject to a 10% withholding tax.
- Dividends paid between Angolan resident companies may be exempt from withholding tax if a participation of at least 25% is held for a period of longer than 1 year prior to the dividend distribution.
- Dividends paid to resident or non-resident companies with stocks traded on a recognized stock exchange market are subject to a reduced withholding tax rate of 5%, applicable for the years 2015 until 2019.
- All royalties paid to resident or non-resident companies are subject to a 10% withholding tax.
- Interest paid to resident or non-resident companies are subject to withholding tax usually at a rate of 15%.
- However, certain interest, such as interest on shareholder’s loans, corporate bonds, bank deposits, treasury bills, treasury bonds and securities issued by the Angolan Central Bank (BNA) are subject to a 10% rate.
- Interest on treasury bonds and securities issued by the BNA are subject to a reduced rate of 5% if the maturity is at least three years.
- Services are usually subject to a 6.5% withholding tax regardless of whether they are paid to a resident or a non-resident service provider.
- Some exemptions may apply depending on the type of service.
|
WHT |
|
|
Dividends |
0%/5%/10% |
|
Royalties |
10% |
|
Interest |
15%/10%/5% |
|
Technical Service Fees |
6.5% |
termination
- Angolan employment law is structured to offer a high level of employee protection.
- For employees with unlimited employment contracts, terminations must follow strict rules, and in general, employees may only be terminated for a serious infringement or an objective and economic reason that is not the fault of the employer.
- Litigation over termination is common.
- For fixed-term employment contracts, employers must serve employees with two weeks' prior written notice before their contract expires.
- Further, a 30-day notice period applies to individual termination for objective reasons and a 60-day notice period applies to collective dismissal.
- There is no severance pay
statutory benefits
- These are mandatory benefits as postulated by law
- These include probationary period, annual leave, public holidays, sick leave, maternity leave, overtime pay, notice period, and severance pay
- Statutory benefits also include social security benefits
|
Statutory Benefits |
|
Probationary Period |
|
Annual Leave |
|
Public Holidays |
|
Maternity Leave |
|
Sick Leave |
|
Overtime Pay |
|
Notice Period |
|
Severance Pay |
|
Social Security Benefits |
payments and invoicing
- The tax year runs from 1 January to 31 December.
- Individuals only deriving employment income are not required to file tax returns, as the employment income tax is withheld at source by their employer.
- Employment income tax is assessed and paid on a pay as you earn (PAYE) basis through monthly WHT collected by employers.
- Self-employed workers file an annual return disclosing their annual income during March of the following year.
- By the end of February each year, employers should file the Employment Income Tax annual return ('Modelo 2').
- This return should disclose the total number of employees (including those who are self-employed), the total amount of wages and other income paid to each employee during the prior year, and the total amount of Employment Income Tax withheld.
ease of doing business
- The ease of doing business index is an index created by Simeon Djankov, an economist at the Central and Eastern Europe sector of the World Bank Group.
- Higher rankings (a low numerical value) indicate better, usually simpler, regulations for businesses and stronger protections of property rights.
- According to the World Bank Angola ranked 177th in the World in 2019 in terms of ease of doing business.
employee accruals
| Christmas Bonus% | It is based on 50% of the salary of December (4.16% of annual salary) |
| Christmas Bonus Over Vacations % | 0% |
| Severance per Year % | Employees are entitled to one months's pay based on one year of service (8.33% of annual salary) |
| Vacations % | Angolan employees are generally entitled to 22 days of vacation per year (6.02%) |
| Notice % | Employees are entitled to 2 weeks of notice for fixed term contract exceeding 3 months (3.83%) |
| Christmas Bonus Over Notifications% | Outstanding Christmas Bonus equivalent to 2 weeks of pay must be paid in December (4.16% of annual salary) |
| Vacations Plus% | Employees are entitled to 50% extra of their monthly base rate for their holiday (4.16% of annual salary) |
| Total percentage of Salary (yearly) | The total employment accruals as a percentage of salary per anum are equal to 30.66% |
employer accruals
Additional information (Country Accruals)
| Social Security | 8% |
| Christmas Bonus | 8.33% |
| Vacations | 9.04% |
| Description | Individuals are liable to social security contributions on their gross income at rates of 3% (8%, in case of retired employees) and 8% due by the employee and the employer, respectively. |
| Taxable income includes all cash or in kind benefits, with the exception of the following: | |
| Social benefits paid by employers. | |
| Holiday allowances. | |
| Values of subscription/participation in complementary social protection schemes. | |
| The contributions are intended to cover family, pension, and unemployment protection. | |
|
Foreign citizens working in Angola (without a residence permit) may be excluded from social security in Angola, provided that they
|
Employer Accruals Additional information
| Employment Accruals | ||
| Annual Leave | Angolan employees are generally entitled to 22 days of vacation per year. | This equals 6.02% ( 22/365 days ) of annual income |
| Maternity Leave | Female employees are entitled to three months of maternity leave. Employees on maternity leave are generally entitled to social security compensation, with supplementation by the employer. | This equals 25% (3/12 months) of annual income |
| Sick Leave | Companies must pay medical leave at 100% of the employee’s salary for the first two months. | This equals 16.66% (2/12 months) of annual income |
| Overtime | Overtime is limited to: • 2 hours per normal day of work • 40 hours per month of work • 200 annual hours Overtime of up to 30 hours per month is paid at an additional 50% rate. |
Normal hourly rate is around 1,631.25 AOA. Overtime is paid at an additional 815.625 AOA. |
| 13th Month Pay | 13th month pay is mandatory.14th-month is also mandatory as a Christmas bonus | This equals 16.66% (2/12 months) of annual income |
| Social Security Contribution | Employers must make social security contribution of 8% | This equals 8% of annual income |
