1

ETS CABINET
DOH LESLIE
NEWSLETTER
Cameroon Tax law updates for 2024

15, May 2024

OFFICE: B.P 9199 BOSTON,

DOUALA CAMEROON
TEL: (237) 678 854 854
Email: dohleslietita@gmail.com ,
info@cacdol.com

WEBSITE. CACDOL.COM

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
2

CABINET PREVIOUS
LIMITATIONS
DOH LESLIE Until December 31, 2023,
overhead expenses and

NEWSLETTER certain service fees, such as

technical, financial, and
accounting assistance, could
Cameroon Tax law updates for 2024
be deducted up to 2.5% of the
taxable profit before
NEW GUIDELINES FOR DEDUCTING OVERHEAD AND deducting these expenses. If a
TECHNICAL ASSISTANCE EXPENSES business was in deficit, this
limitation applied based on
In a recent update, the guidelines for deducting overhead and technical
the results of the last
assistance expenses for businesses facing deficits have been clarified. Here's
profitable fiscal year.
what you need to know as tax payers:
. New Guidelines: The new
Definitions:
provisions specify the
• Continuous Deficit: A business is considered to be in deduction rules for overhead,
continuous deficit when it records a deficit for more than studies, and technical,
four consecutive fiscal years.
financial, and accounting
• New Business: A business is classified as new if it has been assistance for businesses
created for less than three years. facing continuous deficits or
new businesses in deficit.
• Overhead and Technical Assistance Expenses: The
definitions for these terms remain as per the circular NO
006/MINFI/DGI/LRI/L dated February 21, 2020.

Deductibility for New Businesses and Businesses in Continuous

Deficit:

• The deduction for overhead and technical, financial, and accounting

assistance expenses remains capped. However, the deduction varies
based on whether the new business in deficit generates revenue or
not:

• If revenue is generated, the deductible portion is limited to 1% of the

annual revenue (excluding taxes).

• If no revenue is generated, the deductible portion is limited to 1% of the total annual expenses incurred by the
business. This applies particularly to new businesses in the setup or investment phase.

Note: Existing businesses not in continuous deficit for at least four fiscal years are not
eligible for the 1% deduction on revenue. For them, the 2.5% threshold of taxable profit still
applies based on the last profitable fiscal year.
Tap here to add a caption
Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
3

Cameroon Tax law updates for 2024

CHANGES IN DEDUCTIBILITY:
NEW REGULATIONS : Losses or deficits resulting from the transfer of liabilities of a dissolved
ON DEDUCTIBILITY company are no longer deductible if the acquiring company decides to
OF LOSSES DUE TO change the activities previously carried out by the dissolved company.
BUSINESS
RESTRUCTURING Scenarios Generating Deficits: The transfer of liabilities from a
dissolved company to an acquiring company can result in a deficit for the
acquiring company in the following situations:

• When transferred debts exceed the assets received, particularly if the

dissolved company has more debts than assets.

• When the acquiring company incurs significant expenses to restructure the transferred activity, such as severance
pay, site closure costs, legal, and financial advisory fees.

Types of Restructuring Operations:

• Mergers: Two or more companies combine to form a single entity either by creating a new
company or absorbing one of them.

• Partial Asset Contributions: One company transfers a portion of its assets to another company
(new or existing) in exchange for shares issued by the beneficiary company.

Splits: The dissolved company transfers its entire assets to two or more existing or new companies,
with shareholders of the dissolved company receiving shares in the beneficiary companies proportionate
to their ownership rights

Restructuring Operations Covered: Starting January 1, 2024, deficits resulting from the transfer of assets
and liabilities of a dissolved entity to an acquiring entity are subject to deductibility based on whether there's a change in
activities:

• Covered operations involve simultaneous transfer of assets and liabilities from one or more dissolved companies t
o one or more acquiring companies, notably merger-absorption operations and splits.

• Deficits resulting from partial asset contributions are not affected by these regulations as liabilities are not transfer
red in such restructuring.

Criteria for Assessing Activity Change: An activity change in the absorbed

Tap here to add a caption
company refers to the abandonment or partial transfer of one or more activities
resulting in a decrease of over 50% in the acquiring company's revenue compared
to the preceding fiscal year. The burden of proving no activity change lies with the
acquiring company, demonstrating that the revenue decrease is not attributable to
the absorbed company's activity change. Non-deductibility leads to the inclusion of
losses in taxable income and corporate tax recalculations. These regulations apply
to fiscal year results ending on December 31, 2024.

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
4

Cameroon Tax law updates for 2024

DEDUCTIBILITY
CONDITIONS FOR
NEW DEDUCTIBILITY CRITERIA: CASH OPERATING
EXPENSES
• Only expenses equal to or exceeding one hundred thousand (100,000)
FCFA, paid exclusively via transfer, cheque, or electronic means, are Until December 31, 2023,
deductible from taxable income. cash operating expenses
below five hundred thousand
• Expenses below one hundred thousand (100,000) FCFA can still be
(500,000) FCFA were not
deducted if paid in cash, via transfer, cheque, or electronic means.
deductible. However, starting
Electronic Payment Definition: from the 2024 fiscal year, this
Electronic payment includes any transaction made through electronic or threshold has been reduced to
one hundred thousand
computer devices, including payments made via mobile phones
(100,000) FCFA per
transaction
Exceptions to the Rule:

• Fully documented mission expenses for registered individuals.

• Basic product purchases (e.g., cocoa, coffee, tobacco, cotton) directly

from rural producers with valid tax registration.

Exclusion: Foreign Suppliers: This rule does not apply to suppliers based abroad.

In addition to the general deductibility

Non-Deductibility of
conditions outlined in Article 7 of the CGI, any
Expenses for Inactive
Taxpayers expense must be incurred for active taxpayers
listed on the tax authority's database at the
the General Tax Code (CGI)
now states that expenses for
time of the transaction to be deductible for
various types of payments determining taxable income.
made to taxpayers not listed
as active on the tax authority's
CONSEQUENCES OF NON-COMPLIANCE:
Tap here to add a caption
database at the time of the
transaction are not Expenses failing to meet this new condition will be subject to non-accounting
reintegration and will be liable for corporate tax (IS) and individual
deductible.
minimum tax on industrial and commercial income (IRCM).

ACCESS TO TAXPAYER DATABASE: IMPOT.CM

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
 5

CLARIFICATION OF THE CONCEPT OF TAX HAVEN

CAMEROON TAX LAW UPDATES FOR 2024

PREVIOUS DEFINITION:
Before the 2024 Finance Act, a jurisdiction was considered a tax haven based on two criteria:

• The corporate income tax rate was lower than one-third of Cameroon's rate (11%).

• Transparency, as determined by inclusion on international financial organizations' lists of tax havens.

Updated Criteria:
Updated Criteria: Under the new law, the transparency criterion for defining a tax haven is now based on inclusion on
the lists of international bodies promoting transparency and information exchange for tax purposes. These bodies include
the Global Forum on Transparency and Exchange of Information for Tax Purposes, the European Union, etc.

. Alternative Criteria: Both criteria remain alternative, meaning satisfaction of either one is sufficient to establish a
jurisdiction's tax haven status.

STREAMLINING DEADLINES FOR STATISTICAL AND TAX DECLARATIONS

. New Deadlines from January 1, 2024:

• March 15: Deadline for companies under the structure responsible for large enterprises.

• April 15: Deadline for companies under tax centers for medium-sized enterprises and specialized tax centers.

• May 15: Deadline for companies under divisional tax centers.

Clarification of Legal Dependency: ANNUAL TRANSFER PRICING

Before the 2024 Finance Act, legal dependency was
defined based on ownership of at least 25% of another
DECLARATION REQUIREMENTS
company's capital or shared ownership of 25% of the
capital of two companies. Now, legal dependency . Companies under the large enterprise management
Tapincludes
here to add a captionof at least 25% of capital or voting
ownership
rights directly or indirectly. structure are mandated to submit an annual transfer

pricing declaration no later than March 15th of each year

Previously, non-compliance with
transfer pricing declaration
requirements incurred a flat fine of five
million FCFA. The 2024 Finance Act
specifies grounds for sanctions:

• Failure to submit the declaration by the deadline.

• Submission of incomplete or inaccurate declarations. The fine for non-compliance has been
raised from five million FCFA to fifty million FCFA.
Tap here to add a caption
Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
6

Non-Profit Organizations
(NPOs) to Withhold
CAMEROON TAX LAW UPDATES FOR 2024
Income Tax Withholding

SCOPE OF WITHHOLDING

The 2024 Finance law empowers Non-Profit Organizations (NPOs) to withhold income tax at the source when paying

invoices to their suppliers NPOs are authorized to withhold the following income tax withholdings:

• Advance income tax for individuals (IRPP)

• Corporate income tax (IS)

• Prepayment on rent

However, NPOs are exempted from withholding tax on purchases (PSA) and value-
added tax (VAT). No formalities are required for NPOs to be authorized to withhold
tax. Their authorization is automatic, as stated
;m in Article 1, paragraph 2 of the
decree no 0000001/MINFI/DGI dated January 8, 2024, listing entities required to
withhold VAT and income tax at source for the 2024 fiscal year.

REMOVAL OF PREPAYMENT
EXEMPTION FOR INDUSTRIAL
PURCHASES
Previous Exemption:
Before the 2024 Finance Act, industrialists registered under the actual regime were exempt from paying prepayment on
purchases made for their operational needs. Tap here to add a caption

Change in Legislation:
the new finance law, this exemption is removed, and industrialists are now required to pay prepayment on all purchases
made from January 1, 2024, onwards, including those for their operational needs.

This change applies to all purchases made by industrialists, even those for their
operational needs, from other industrialists, producers, importers, and forest
operators however Companies listed in the Minister of Finance's decree, which
outlines entities authorized to withhold taxes at source, are exempt from
prepayment withholding on purchases.

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
 7

CAMEROON TAX LAW UPDATES FOR

2024
DIGITALIZATION OF WITHHOLDING TAX
CERTIFICATES
CHANGE IN LEGISLATION:
As of December 31st, withholding tax certificates were issued by
authorized entities and companies responsible for withholding VAT and With the 2024 Finance Act, the issuance of
income tax or corporate tax. These certificates took various forms, withholding tax certificates is now exclusively
depending on the issuing entity, without prior validation from the tax done online through the computer system of the
authority. General Tax Directorate. This reform allows for
precise distribution of roles between collecting
Additionally, accountants, including Paymasters-General, Receivers, entities, taxpayers subject to withholding, and
Collectors, Accountants, and Ticket Sellers, were not obliged to tax services.
systematically issue certificates for withholding taxes on payments made
to suppliers and contractors of the State and other public entities. Implementation:
All withholding tax certificates for 2024 must be
Furthermore, certain taxes, such as prepayment on purchases,
exclusively issued on the DGI's digital platform.
prepayment on rents, special tax on income, special tax on petroleum
Operations carried out since January 1st, 2024,
products, tax on movable capital income, tax on non-commercial income,
must be regularized on the OTP/EBILLING
stamp duty on advertising, and a 5.5% prepayment on income paid to
platform. For transactions in April 2024,
liberal professionals and providers of Simplified and Liberator Tax
certificates can only be generated after the
regimes, although subject to withholding tax, did not result in the
withholding taxes are paid by May 15th, 2024.
issuance of a certificate.

Clarification on IRCM Taxable Base for Indirect Share

Transfers

Previously, under existing legislation, the taxable base for capital gains on indirect share transfers was calculated as the
difference between the selling price and the acquisition price or value of the shares at the time of acquisition. Now, with
the new law, the selling price used to determine the taxable base of these transfers cannot be lower than the value of the
shares sold.

Valuing shares can be done using various methods, including:

• Discounted Cash Flow (DCF) method: This method involves discounting future cash flows generated by the
shares.

• Market multiples method: This method compares the value of the shares to that of other comparable publicly
traded companies.
Tap here to add a caption
Net Asset Value method: This method is based on the net value of the company's assets

The burden of proof lies with the tax authority, which must establish, in detail, that the declared
selling price is lower than the actual value of the shares sold. Additionally, the tax authority must
explain and justify the chosen valuation method, demonstrating its relevance to the specific
characteristics of the shares sold and the relevant market. the tax authority may engage external
experts to assist in valuing the shares, ensuring adherence to proper procedures and maintaining
neutrality and objectivity in the assessment.

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
8

CHANGES IN REAL ESTATE CAPITAL GAINS TAX RATE

CAMEROON TAX LAW UPDATES FOR 2024

PREVIOUS REGULATION:
For this measure, cash payments into the seller's account do not
Until December 31, 2023, all real
qualify as payments via bank transfer, thereby disqualifying them
estate capital gains resulting from
transactions in areas with an from the 5% reduced rate application.
administrative price list were subject
Compliance Requirement: To benefit from the reduced tax
to a 5% withholding tax
rate, the notary or the purchaser, if applicable, must provide proof
New Regulation: of payment via bank transfer or electronic means during the online
Starting January 1, 2024, the declaration of the transaction. Accepted documents include bank
previously mentioned 5% reduced rate statements from both the seller and buyer in the case of a transfer,
no longer applies to real estate copies of checks, etc. Failure to provide such documentation will
transactions settled in cash. Such automatically result in the system applying the 10% rate to the
transactions are now subject to a 10%
capital gains in question
rate

VAT Deductibility Rules

CAMEROON TAX LAW UPDATES FOR 2024

What's Changing?

The Tax Code now sets stricter conditions for VAT deductibility on transactions. Previously, until December 31, 2023, VAT
had to be present on an invoice issued by a registered supplier under the real regime and mentioning their Tax
Identification Number ( to be deductible.

New Requirements:

1. Invoice with Electronic Billing: VAT must now be visible on an invoice duly issued through the electronic
invoicing system of the tax authority.
Tap here to add a caption
2. Supplier Registration: VAT should appear on an invoice issued by a supplier registered in the active taxpayers'
file at the time of the transaction.

VAT on invoices issued outside the electronic invoicing system of the tax
authority or by suppliers not registered in the active taxpayers' file at
the time of invoicing is no longer deductible.

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
9

SUBMIT AUDITOR REPORTS AND

INVENTORIES TO TAX AUTHORITIES WHO NEEDS TO
COMPLY?
The 2024 Finance Law introduces a requirement for taxpayers to
voluntarily submit auditor reports and inventories duly certified by the
courts to the tax administration.
This requirement applies to
What Needs to be Submitted? businesses subject to the
OHADA Uniform Act on
Businesses must provide the tax authorities with:
Commercial Companies and
• Auditor reports, including annual reports on financial statements, Economic Interest Groupings.
special reports on regulated agreements, and reports on merger, Specifically, it concerns:
split, partial asset contribution, and transformation operations.
• Companies with a
• Inventories certified and filed with the courts, including balance statutory auditor, such as
sheets, income statements, and inventory operation summaries. SA and SARL meeting
How to Submit certain criteria.

Documents must be sent in sealed envelopes to the taxpayer's assigned tax • Companies requiring
authority within fifteen days of notification or court filing. year-end inventories as
part of their legal
Failure to comply within the specified timeframe or obligations.
submission of false reports can result in fines of up to
FCFA fifty million, as per Article L 104 (2) of the Tax
Code.

EXPANSION OF
WITHHOLDING Who is Affected?

TAX OBLIGATION Individual taxpayers, including employees, property income holders, and
TO FOREIGN investment income earners, now have the responsibility to withhold TSR
PAYMENTS from payments made to non-residents of Cameroon for services used within
the country.
In the past, only businesses
and establishments in Understanding the Requirement
Cameroon, the State, and
When individuals pay remunerations abroad for services utilized in
decentralized local authorities Tap here to add a caption
Cameroon, they must, as legal withholders of TSR, deduct this tax at the
were obligated to withhold source on behalf of the State. The applicable rates remain those specified in
the Special Tax on Revenues the tax regulations
(TSR). However, with the
Reporting and Payment
2024 Finance Law, there's a
According to tax regulations, individuals must declare and remit the withheld
significant change: TSR to the tax office of their jurisdiction by the 15th day of the month
following the payment. Failure to comply can be rectified through the annual
summary declaration for individuals.

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.
10

This publication serves to provide general information and does not

constitute a professional opinion or legal advice

All right reserved

Doh Leslie Tita (Licensed CPA and Register

Auditor with CEMAC and ONECCA)

Contact Us
Ets Cabinet Doh Leslie
B.P. 9199, Boston, Douala Cameroon
(237) 678854854
info@cacdol.com ,
dohleslietita@gmail.com
cacdol.com

ETS CABINET DOH LESLIE

B.P. 9199, Boston, Douala
Cameroon

B.P. 9199, Boston, Douala Cameroon

Cabinet DOH LESLIE (Expertise Comptable et Commissariat aux Comptes). All rights reserved.