Botswana Salary Calculator 2019/20

Welcome to the Botswana Salary and Tax section of iCalculator. In this section we provide detailed tax guides, tax calculators and salary calculators for Botswana.

On this page we provide:

Botswana Salary Calculator 2019/20

Calculate your take home pay in Botswana (that's your salary after tax), with the Botswana Salary Calculator. A quick and efficient way to compare salaries in Botswana, review income tax deductions for income in Botswana and estimate your tax returns for your Salary in Botswana. The Botswana Tax Calculator is a diverse tool and we may refer to it as the Botswana wage calculator, salary calculator or Botswana salary after tax calculator, it is however the same calculator, there are simply so many features and uses of the tool (Botswana income tax calculator, there is another!) that we refer to the calculator functionally rather than by a specific name, we mention this here to avoid any confusion.

Botswana Tax Calculator 2019/20
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Botswana Wage Calculator. This image shows the Botswana flag and information relating to the tax formula for the Botswana Tax Calculator

Taxation in Botswana

Botswana, officially known as "Republic of Botswana" is a South African country with one of the fastest growing economies in the world. Since gaining independence in 1966, Botswana has been building up its economic foundation majorly on the basis of diamond mining.

Taxation in Botswana is source based. This means that the residence of the taxpayer is considered for the calculation of taxable income. The income generated from the source, or deemed to be from the source in Botswana is taxable. Generally, any income generated outside Botswana is not taxable, however there are some exceptions.

Botswana Unified Revenue Services (BURS)

Botswana Unified Revenue Services (BURS) is a government sponsored entity and is in charge of revenue services in Botswana. BURS is responsible for tax collection, providing tax assistance to taxpayers, filtering erroneous and fraudulent tax filings.

BURS functions and carries its activities through Ministry of Finance & Development as specified by the BURS act. All the taxes and revenues applicable in the country are collected by BURS.

Compliance requirement and Income basis of Personal tax

Residents

Personal income tax earned by resident employees is generally recovered by withholding tax under pay as you earn (PAYE) at the source. This way taxes are deducted directly from the salary by the employer and paid directly to the government.

Withholding tax is to be paid within 15 days of the end of the month of the deduction.

Residents with gross income exceeding P36,000.00 are required to register as taxpayers and file their tax returns not later than 30th September. Extensions are given on requests.

2019 Tax rates for Residents are avalable here.

Non residents

Non residents who derive income from the source in Botswana are required to register as taxpayers in Botswana. They are liable for filing tax returns in the same way as residents. Non residents are taxed differently from residents as there is no exemption on first P36,000.00 earned. This, however, is charged on the minimum tax bracket of 5%.

2019 Tax rates for Non-Residents are avalable here.

Types of taxable income

According to Botswana income tax act, an amount that is received in any type of compensation & remuneration earned in Botswana or deemed to be earned in Botswana is considered as taxable income. This includes,

  • Any income received by the person - Basic salary, leave pay and bonuses
  • Fee & commissions
  • Credited to account, accumulated, capitalized, carried or reserved of Due and payable, even though not actually paid
  • Cash allowances, such as travelling and entertainment
  • Non cash benefits, etc.

Tax exemptions

Expatriates in Botswana are only exempted on one third of contractual annual gratuity.

Below is the list of items that are exempt from taxation within employment contracts:

  • One third of gratuity paid. This can be paid after completion of minimum two years in service.
  • Health insurance, any medical cost that is paid by the employers.
  • One third of the retrenchment benefits received from the previous employer.

In addition, there are some instances where individuals are tax exempt in Botswana. This generally happens in case of employees of diplomatic missions or employees of the companies that provide technical assistance to the government of Botswana

Self-Assessment for businesses

Businesses are required to follow the self-assessment system. Gross income for a business may include:

  • Amount of revenue generated within the financial year
  • Market value of any benefits obtained
  • Value of closing stock
  • Insurance compensation against the loss of profit or property damage
  • Management of consultancy fee
  • Bad debts recovered
  • Capital gains from disposal of business assets

Allowable deductions

To qualify for deduction, according to the general rule, the expenses should be wholly, necessarily and exclusively incurred in the production of income for the financial year. This may include:

  • Purchases made for production
  • Salaries, wages paid to the employees
  • Employer's contribution to pension fund up to 20% of remuneration
  • Rates, rent and interests
  • Repairs, subscription of trade unions

Non allowable deductions

  • Expenditure or loss that is recoverable by insurance
  • Expenses on hospitality (not as per the general rule)
  • Leave pay and other provisions like gratuities, tax payments, etc.
  • Cost of local transportation used to travel between home and business address, donations not made to a specific person/ organization

Botswana - Income & Other taxes

As we discussed earlier in our introduction to tax in Botswana, diamond mining has been the largest base for tax revenue after the discovery of diamonds in the mid-seventies. However, to move away from exclusively diamond based economy, the Botswana government has introduced a variety of taxes. Let's have a look at tax administrations and various tax regimes in Botswana.

Financial year

Financial year end date for individuals is 30 June of each year. However, a business may select its own financial year, which may end on another date.

Tax return

Botswana requires self assessment for businesses. Self assessment is optional for individual taxpayers. The system allows all taxpayers to submit the return in the standard format. Tax return due date for filing tax is September 30 of each year. This is within four months of financial year end.

Payment of tax

Tax payable for the tax period, is to be paid within four months from the end of financial year. If the tax payable amount for the year exceeds P50,000.00, there is a provision of making the payments in four equal quarterly installments. Here, first installment should be made within three months of the financial year end, and the rest on three months intervals thereafter.

Tax Statute of limitation

There is a tax statute of limitations of four years. The submitted tax returns may only be reopened within four years of the first assessment done by BURS. Self assessment should be made any time within four years after the end of the tax year.

Tax audit process

BURS reserves the rights to initiate audit due to any factor that is determined by them. The taxpayer is made aware of the records and information to make them available for inspection, in advance.

Taxes on investment and capital gains

Revenue generated by investments and capital gains are taxable in Botswana, this includes:

  • Disposal of residential or commercial properties
  • Company shares

Both movable and immovable assets of businesses that are based in Botswana are subject to tax. Capital gains are given the benefit of inflation in case of immovable property. For other gains no allowances are granted.

You can find more detailed information on capital gains in Botswana and calculate capital gains due in Botswana using our online Capital Gains Tax Calculator.

Value added tax (VAT)

VAT is imposed on importation of goods and taxable supplies in Botswana. The standard VAT of 12% is applied to all the supplies that do not meet the exemption policy. Output VAT is collected by registered vendors at the time of sale and input VAT is paid on purchase. Every vendor making supplies more than P1,000,000.00 is required to be registered for VAT.

School fees, postal services and cremation/ burial services are exempt from VAT. Input VAT can be claimed for zero rated supplies that include: Essential food items, books, newspapers, construction of residential buildings, transportation costs for supplies for charity, etc.

Vocational Training Levy (VTL) is payable at the time of submission of VAT return. It is calculated as a percentage of turnover. This ranges from 0.2% to 0.05%.

You can find more detailed information on VAT in Botswana and calculate VAT due in Botswana using our online VAT Calculator.

Property tax and social security contributions

There are no property tax and social security contributions taxes in Botswana.

Transfer duties on Immovable properties

There is a standard 5% transfer duty tax on immovable Freehold /leased properties. The first P200,000.00 of this value is exempt in case of transfer to Botswana citizens. A non citizen is subject to pay 5% transfer tax in case of agriculture property.

You can calculate the transfer duty on immovable property in Botswana using the Botswana IPTD Calculator.

Customs and excise duties

Customs and excise duties are charged on imports and exports in Botswana. Customs duties are waived in case of trade between Botswana and South Africa, Lesotho, Namibia, and Swaziland, as these countries are part of Southern African Customs Union. Botswana is in a trade agreement with Zimbabwe, which exempts customs and duties from either of trading partners under the conditions that goods meet 25% of local content.

Payroll taxes

As per Botswana Unified Revenue Services (BURS), every employer with non residents employees and the residents employees earning income more than taxable threshold must withhold tax. This should be done on the standard tax rate and the amount should be remitted on a monthly basis to BURS. This is done before the 15th day of the next month. An annual return has to be filed within 31 days after the financial year end.

Tax incentive: Via tax holidays

Botswana government offers promotions under Development approval order. Depending on the scale and magnitude of a project, companies can apply for tax holidays. Generally, companies with big projects are granted the incentive. These tax holidays can last for 5 to 10 years and can result in a decrease in tax rates.

Botswana Income Tax Calculators