Let’s face it: navigating corporate tax regimes can feel like a maze designed to trip up even the savviest entrepreneur. If you’re considering Mozambique as a base for your company in 2025, you’re probably looking for clarity, not confusion. This guide breaks down Mozambique’s corporate tax system with hard data and actionable strategies—so you can optimize your tax position and keep more of what you earn.
Understanding Mozambique’s Corporate Tax Rate in 2025
Mozambique applies a flat corporate income tax rate of 32% on taxable profits for resident companies. This means that, regardless of your company’s profit level, the same rate applies—no progressive brackets, no hidden thresholds. For international entrepreneurs, this predictability can be a double-edged sword: it’s simple, but there’s little room for maneuver within the standard regime.
| Tax Type | Rate | Who Pays? | Notes |
|---|---|---|---|
| Corporate Income Tax | 32% | Resident companies | Flat rate on taxable profits |
| Surtax (Autonomous Taxation) | 35% | All companies | On confidential/illicit expenses or those lacking documentation |
| Withholding Tax (WHT) | 20% | Non-resident entities (no PE) | Final tax on gross income |
| Reduced WHT | 10% | Non-resident entities (no PE) | Certain sectors (e.g., telecom, transport, rural energy, fishing, agri-services) until end of 2025 |
Key Surtaxes and Withholding Taxes: What to Watch For
Beyond the headline 32% rate, Mozambique’s tax regime in 2025 includes several important surtaxes and withholding taxes that can catch the unwary:
- 35% Surtax: Applied to any confidential or illicit expenses, or expenses without proper documentation. This is an autonomous tax—meaning it’s assessed separately and can’t be offset against other tax liabilities. Pro Tip #1: Keep meticulous records and avoid any undocumented transactions to sidestep this punitive rate.
- 20% Withholding Tax: Non-resident entities without a permanent establishment (PE) in Mozambique face a 20% final withholding tax on gross income. This is definitive—no further Mozambican tax is due on this income. Pro Tip #2: Structure your operations to either establish a PE or ensure income is not Mozambican-sourced to avoid this flat WHT.
- 10% Reduced Withholding Tax: For certain sectors (telecommunications, international transport, rural energy infrastructure, maritime freight for fishing/coasting, and services to local agricultural companies), a reduced 10% WHT applies for non-residents without a PE—but only until the end of 2025. Pro Tip #3: If you’re in these sectors, act fast to benefit from the lower rate before it expires.
Case Study: How the Numbers Play Out
Suppose your Mozambican company earns 10,000,000 MZN (approx. $156,000) in taxable profits in 2025. Here’s how the tax would break down:
- Standard Corporate Tax: 32% of 10,000,000 MZN = 3,200,000 MZN (approx. $50,000)
- If you incur undocumented expenses: 35% surtax applies to those amounts—potentially adding significant cost.
- If you’re a non-resident entity with no PE: 20% WHT on gross income, or 10% if you qualify for the sectoral reduction (until end of 2025).
Checklist: Optimizing Your Corporate Tax Position in Mozambique
- Document Everything: Ensure all expenses are properly supported to avoid the 35% autonomous tax.
- Review Your Residency Status: Consider establishing a permanent establishment if it reduces your overall tax burden.
- Leverage Sectoral Incentives: If you operate in telecom, transport, rural energy, or agriculture, confirm eligibility for the 10% WHT before the end of 2025.
- Monitor Regulatory Changes: Mozambique’s tax incentives can change—stay updated to avoid surprises.
Summary: Key Takeaways for 2025
- Mozambique’s flat 32% corporate tax rate is straightforward but leaves little room for negotiation.
- Surtaxes and withholding taxes can significantly increase your effective tax rate if you’re not careful.
- Proper documentation and strategic structuring are essential for minimizing your tax burden.
- Sector-specific incentives offer short-term opportunities—especially for non-residents in qualifying industries.
For further reading on Mozambique’s tax system, consult the official Mozambique Tax Authority or the PwC Mozambique Tax Guide.