Mozambique taxes residents on worldwide income and non-residents on Mozambique-source income only. Mozambique operates a self-assessment system for corporate tax, and separately has genuine CFC attribution rules addressing profits parked in low-tax foreign subsidiaries (see CFC section below).
Mozambique's tax year runs the calendar year, with an annual returns deadline of 31 March of the following year.
Mozambique's headline corporate income tax (CIT) rate is 32% (10% for agriculture/livestock/aquaculture/transport).
The headline personal income tax (PIT) rate is residents 32%; non-residents 20%.
The standard VAT/GST (or equivalent consumption tax) rate is 16%.
A company is resident in Mozambique if either its legal seat or place of effective management is in Mozambique; Mozambican companies are taxed on worldwide income, while branches (treated as non-resident entities) are taxed only on Mozambique-attributable income.
A non-Mozambican entity has a Mozambique permanent establishment through a fixed place of business or a dependent agent habitually concluding contracts in Mozambique on the entity's behalf, following the OECD Model Treaty definition as applied under Mozambican domestic law and any applicable tax treaty.
Mozambique has genuine CFC provisions: profits of a non-resident company subject to a "clearly more favourable" tax regime (no income tax, or an effective rate at or below 60% of Mozambique's CIT rate) are attributed to Mozambique-resident shareholders in proportion to their shareholding, regardless of actual distribution - applicable where the shareholder holds 25% or more directly/indirectly, or 10% or more where Mozambique-resident shareholders collectively hold more than 50% of the foreign company.
Thin capitalization rules apply when the debt-to-equity ratio exceeds 2:1.
Mozambique does not use an elective check-the-box classification system; entity classification generally follows the entity's actual legal characteristics. Mozambique 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.
Mozambique does not provide a broad participation exemption for foreign dividends in the European sense; relief from double taxation is available primarily through Mozambique's foreign tax credit system, coordinated against Mozambique's own genuine CFC regime to avoid double-counting attributed profits.
Mozambique has a foreign tax credit mechanism for foreign tax paid on foreign-source income also taxed in Mozambique, capped at the Mozambican tax otherwise due on that income.
Mozambique has nine double tax treaties in force: Portugal, Italy, Mauritius, the UAE, Macau, South Africa, India, Botswana, and Vietnam - generally following the OECD Model, and prevailing over conflicting domestic provisions per Mozambican law.