The standard corporate tax rate for resident companies (including the branch or permanent establishment of a foreign entity) is 30%.
However, a number of other rates apply as follows:
- Industrial companies and mining companies are subject to a reduced tax rate of 25% (for mining companies, only income effectively derived from the exploitation of mineral deposits is eligible to the reduced rate);
- Oil companies engaged in the business of exploration and exploitation and production and sale of natural hydrocarbons are taxed in the range of 35%-45%;
- New companies formed in Benin are granted an income tax reduction in accordance with the provisions of article 156 bis of the Tax Code: 25% for the first and second years of operation, 50% for the third year of operation;
- Companies with a turnover not exceeding XOF 20 million are classified as micro enterprises and are subject to tax at progressive rates based on turnover. Companies with a turnover between XOF 20 million and XOF 50 million are classified as small enterprises and are subject to tax at a flat rate of 2% on turnover, subject to a minimum of XOF 150,000;
- Dividends received are chargeable to tax at a rate of 10% generally and 5% if received from a company listed on an approved stock exchange;
- Capital Gains derived from the sale of bonds are chargeable to tax at a rate of 5%; and
- Interest income arising from debts, deposits and guarantees are chargeable to tax at a flat rate of 15%, except interest income on bonds with tenure of more than 5 years where the flat rate is 6%. Further, interest income on bonds issued by a Member State of the Western African Economic and Monetary Union is chargeable to tax at a flat rate of 3% if with a tenure of more than 5 years but less than 10 years, and exempt with a tenure of more than 10 years.
The corporate tax due may not be less than 1% of receivables generally (3% with respect to construction and public works companies, and 10% with respect to companies whose assets consist predominantly of real estate). In all cases, the minimum amount payable may not be lower than XOF 500,000. Specific rules apply to specified businesses including used car dealerships and gas stations.