Africa · Tax guide
Ethiopia
Ethiopia taxes company profits at 30% and charges VAT at 15% once turnover passes Br 2,000,000. The tax year follows the Ethiopian calendar, ending on 7 July, and taxes are administered by the Ministry of Revenues.
At a glance
- Corporate income tax
- 30%
- VAT
- 15%
- VAT registration
- Br 2,000,000
- Withholding on payments abroad
- 10%
On business profits
Standard rate
Annual taxable turnover
Dividends and interest
Business income tax
Companies pay 30% on taxable profits. The tax year ends on 7 July (Hamle 30) and larger taxpayers file their annual return within four months of the year-end.
VAT
VAT is 15%. Registration is required once annual taxable turnover exceeds Br 2,000,000. Returns are filed monthly, and sales are recorded on registered cash register machines or approved invoices. Businesses below the threshold may pay turnover tax instead.
Payments abroad
Dividends and interest paid to non-residents carry 10% withholding, with different rates on royalties and technical services, unless a treaty lowers them.
Key dates
- MonthlyVAT return
- Within four months of 7 JulyAnnual business income tax return
Figures and sources
4 figures- Corporate income tax rate30%Under professional review
- VAT rate15%Under professional review
- Annual taxable turnover above which VAT registration is requiredBr 2,000,000Under professional review
- Withholding on dividends and interest paid to non-residents (5% royalties, 15% technical services)10%Under professional review
Indicative only. This assessment is a high-level overview of tax obligations in Ethiopia based on the information you provided and rules in force for 2026. It is not tax or legal advice. Consult a qualified tax adviser in Ethiopia (an Ethiopian tax adviser) before making compliance decisions.