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Taxation in Afghanistan

Taxation Information

The Afghanistan Revenue Department (ARD) is tasked with the administration and collection of both tax and non-tax revenue on behalf of the Government of Afghanistan. The ARD has categorized taxpayers into segments based on their income levels and economic activities. This classification includes offices dedicated to Large, Medium, and Small taxpayers, each responsible for overseeing tax collection within their respective categories. Additionally, at the provincial level, ARD is represented by officials stationed at Mustofiats, who carry out tax collection functions.

For comprehensive information and resources related to taxation, including the Income Tax Law of 2009 and the Income Tax Manual, please visit the ARD's official website at http://www.ard.gov.af.

Tax Information

An Overview of Taxes

Obtaining a Tax Identification Number (TIN)
Obtaining a Tax Identification Number (TIN) in Afghanistan is a straightforward process that can be completed either online through the official system at (tin.ard.gov.af) or in person at designated tax offices, including the Large Taxpayers Office (LTO), Medium Taxpayers Office (MTO), and Small Taxpayers Office (STO). To secure a TIN, applicants must present their business license and National ID (NID), ensuring compliance with Afghanistan's tax regulations. This essential step is crucial for businesses to operate legally and fulfill their tax obligations within the country.
When to File Taxes
Taxes should be filed promptly to ensure compliance with legal requirements. For salary and contractual taxes, submissions must be made within 10 days of the following month, while rent taxes are due within 15 days. The Annual Income Tax Return (AITR) must be filed by the 31st of Jawza, with income tax payments also due by the end of Jawza. Business Receipt Tax (BRT) should be filed within 15 days after the conclusion of each quarter. Timely filing of these taxes is essential to avoid penalties and maintain good standing with tax authorities.
Method of Accounting
Accrual and Cash base accounting methods are used (Law mandates Accrual).
Taxation Year
The taxation year in Afghanistan is from 1st HAMAL to the end of HOOT.
Value Added Tax (VAT)
Afghanistan does not currently have a formal VAT system. Certain goods and services may be subject to sales tax at rates ranging from 5% to 20%.
Withholding Taxes
Contractual: 2% with a license, 7% without a license; Salary: 2%, 10%, and 20%; Rental services: 10% up to 9,999 AFN, 15% up to 99,999 AFN.
Business Receipts Tax (BRT)
BRT is applied at rates of 4%, 5%, and 10%.
Fixed Taxes
Applied on imports, exhibitions, transportation services, etc.
Fixed Taxes
Applied on imports, exhibitions, transportation services, etc.
Note
Tax laws and rates are subject to change. Consult with a tax professional or the relevant tax authority for the most up-to-date information. Additionally, Afghanistan's economic and political situation may impact tax policies and rates.

Personal Taxes

Corporate Income Tax
Applied on imports, exhibitions, transportation services, etc.
Income from Income up to Taxes
0 AFN 60,000 No Tax
AFN 60001 AFN 150000 2 percent of amount over AFN 6,000
AFN 150001 AFN 1200,000 10% of amount over AFN 150000
AFN 1200,001   20% of amount over AFN 120,0000

Individual Income Tax
The progressive tax rates range from 0% to 20% based on income level.
Salary from Salary up to Taxes
0 AFN 5,000 No Tax
AFN 5,001 AFN 12,500 2% of amount over AFN 5,000
AFN 12,501 AFN 100,000 AFN 150 + 10% of amount over AFN 12,500
AFN 100,000   AFN 150 + AFN 8,750 + 20% of amount over AFN 100,000

Afghanistan Tax Guidelines

File Name Size Download
Contractor withholding threshhold saves taxpayer compliance cost 2.7 MB Download
Withholding Tax on Rental Services 2.7 MB Download
Business Receipts Tax 2.7 MB Download
Tax Overview for Businesses, Investors & Individuals 2.7 MB Download
Wage Withholding Tax 2.7 MB Download
Paying tax by electronic transfer 2.7 MB Download
Tax Guide for Corporations and Limited Liability Companies-E 4.1 MB Download
Disputing the amount of tax payable in a tax assessment 2.7 MB Download
Taxable and Non-Taxable Income 2.7 MB Download
Deductible Business Expenses 2.7 MB Download
Accounting Methods and Recordkeeping 2.7 MB Download
Taxpayer Identification Number (TIN) 2.7 MB Download
Fixed Taxes on Commercial Activities 2.7 MB Download
Taxable and Non-Taxable Income 2.7 MB Download
Depreciation of Assets 2.8 MB Download
Withholding Tax on Contractor Services 2.7 MB Download
Additional Tax and Penalties 2.7 MB Download
Confirming an exemption from income taxation of a 2.7 MB Download