Botswana taxes residents on worldwide income and non-residents on Botswana-source income only. Botswana operates a self-assessment system for corporate tax, with Botswana Unified Revenue Service (BURS) conducting post-filing review. Under the new Income Tax Act 2026, effective July 1, 2026, Botswana raised its standard corporate tax rate from 22% to 24.5% and reduced the non-resident corporate rate from 30% to 24.5%, alongside new transfer pricing regulations and a domestic minimum top-up tax (DMTT).
Botswana's tax year runs 1 July to 30 June.
24.5% standard rate, effective July 1, 2026 (up from 22%), per the Income Tax Act 2026. Manufacturing companies with a valid Development Approval Order retain a concessional 15% rate; International Financial Services Centre (IFSC) companies pay 15%.
Botswana levies personal income tax with a top marginal rate of 26.5% (raised from 25% under the 2025/2026 budget), plus a new highest bracket of 27.5% on income above BWP 400,000 annually introduced by the Income Tax Act 2026.
The standard VAT rate is 14%.
An individual is a Botswana tax resident for a tax year if they have a permanent place of abode in Botswana and are physically present at least 183 days in that tax year or the previous one. Botswana's system is generally source-based, though resident citizen individuals are taxed on foreign dividend and interest income, and a company accredited to the Botswana International Financial Services Centre (IFSC) is taxable on worldwide income.
A non-Botswana entity has a Botswana permanent establishment through a fixed place of business or a dependent agent habitually concluding contracts in Botswana on the entity's behalf, following the OECD Model Treaty definition as applied under Botswana's domestic law and any applicable tax treaty.
Botswana has no CFC rules.
Botswana's general thin capitalization rules apply specifically to mining companies. Separately, IFSC companies face a specific interest-disallowance formula where foreign debt interest is owed to a foreign controller (or a connected person) and total foreign debt exceeds the "foreign equity product" during the tax year - the excess-related interest is disallowed using a day-weighted formula.
Botswana does not use an elective check-the-box classification system; entity classification generally follows the entity's actual legal characteristics. Botswana does not have a comprehensive ATAD2-style anti-hybrid regime.
No foreign bank account or foreign financial asset reporting regime exists requiring residents to separately disclose foreign accounts; foreign income is reported through the standard annual tax return.
Botswana does not provide a broad participation exemption for foreign dividends in the European sense; relief from double taxation is available primarily through Botswana's foreign tax credit system.
Botswana has a foreign tax credit mechanism for foreign tax paid on foreign-source income also taxed in Botswana, capped at the Botswana tax otherwise due on that income.
Botswana has double tax treaties with Barbados, France, India, Mauritius, Russia, Seychelles, South Africa, Sweden, the UAE, and the UK.