Sao Tome and Principe taxes resident companies on their total income (after deducting relevant costs) at a standard 25% Corporate Income Tax (Imposto sobre o Rendimento de Pessoas Colectivas, IRC) rate, while non-resident companies with a permanent establishment are taxed only on income attributed to that establishment, administered under the Tax Benefits and Incentives Code (Decree-Law No. 15/2016) and the general IRC framework.
The tax year generally follows the calendar year; investment projects under the Investment Code may benefit from irrevocable tax incentives for the duration of the incentive period, provided the investor complies with the Investment Code's conditions.
25% standard rate. A 20% withholding tax may apply in certain cases, and a reduced 10% rate is available for some new business activities. An earlier version of this page incorrectly displayed the World Bank's total tax-and-contribution burden (approximately 37% of commercial profit) as if it were the statutory corporate rate - that was a different metric entirely and has been corrected.
Progressive, up to a 25% top rate, on worldwide income for residents (180+ days present, or habitual residence) and Sao Tome-source income for non-residents. Capital income and certain capital gains are generally taxed separately at a flat 15% via final withholding rather than the progressive scale.
15% standard rate, in effect since June 2023. A simplified regime offers reduced rates for smaller businesses: 7% for turnover up to STN 1,000,000, and a flat 2% annual tax for turnover up to STN 100,000. Basic foodstuffs and certain essential services may qualify for a further-reduced 5% rate; health, education, and financial services are exempt.
An individual is tax resident if present in Sao Tome and Principe for more than 183 days. Residents are taxed on worldwide income; non-residents are taxed only on Sao Tome-source income (a territorial approach for non-residents specifically) - notably, non-resident individuals pay no tax on foreign-sourced income, capital gains, wealth, or inheritance.
A non-resident company is subject to Sao Tome and Principe corporate tax only on the income attributed to a permanent establishment maintained in the country; Article 19 of the Corporate Income Tax Code specifically includes non-resident companies carrying out activities within Sao Tome and Principe through a permanent establishment in the general (Group 1) tax regime alongside public enterprises, joint-stock companies, and limited partnerships.
No CFC-style attribution provision was found in Sao Tome and Principe's tax legislation despite genuine search effort, including a specialist Africa-focused legal source (Addleshaw Goddard) covering the country's Individual Income Tax (IRS) and Corporate Income Tax (IRC) framework in reasonable detail without mentioning a CFC-style mechanism. Sao Tome and Principe follows a Portuguese-derived legal tradition (individuals taxed on worldwide income, non-residents on Sao Tome-source income only), but no dedicated cross-border anti-deferral or transfer-pricing-specific statutory provision was located in the sources reviewed. This should be treated as "no CFC provision found in the sources reviewed" rather than an absolute guarantee, and confirmed directly with a Sao Tome-qualified adviser before being relied upon for a specific structure.
No statutory thin capitalization ratio is identified in available sources.
Sao Tome and Principe classifies entities under its own domestic Corporate Income Tax Code rather than offering an elective check-the-box system, and no ATAD2-style anti-hybrid mismatch regime addressing double-deduction or deduction-without-inclusion outcomes has been identified, consistent with no CFC-style attribution provision being found in the country's tax legislation despite genuine search effort. Sao Tome and Principe follows a Portuguese-derived legal tradition without a dedicated cross-border anti-deferral mechanism beyond general transfer pricing and anti-avoidance principles.
No domestic FBAR-equivalent regime requires Sao Tome and Principe residents to separately disclose foreign financial accounts. Sao Tome and Principe is not currently a CRS participating jurisdiction, per a current (2025) cross-referenced list of non-CRS countries against the OECD's own participant list, meaning it does not automatically exchange financial account information with foreign tax authorities. US persons remain independently subject to FinCEN Form 114 (FBAR) and potentially Form 8938 regardless of Sao Tome and Principe's own rules.
The applicable foreign exchange regime does not impose relevant restrictions on the transfer of dividends abroad; a dedicated participation exemption regime for dividends or capital gains from a qualifying subsidiary distinct from the general 25% IRC rate is not confirmed in available primary sources, and dividends paid to non-resident entrepreneurs are instead subject to a 20% withholding tax at source.
Sao Tome and Principe's double tax treaties, notably with Portugal (signed 2015, effective 2018) and Cabo Verde, allow taxpayers to claim foreign tax credits and reduce withholding taxes on dividends, interest, and royalties between the two treaty partners; a broader general unilateral foreign tax credit mechanism outside this narrow treaty network is not confirmed in available primary sources.
Sao Tome and Principe's primary and most substantive tax treaty is with Portugal (signed 2015, effective 2018). Additional treaty relationships with Angola and Cape Verde are referenced by one source but are not independently corroborated elsewhere. Sao Tome and Principe has no bilateral tax treaty with the United States, the United Kingdom, or Canada.