# Botswana Corporate Income Tax v1.0

> **General reference only.** This skill is general tax reference material. It has not been reviewed for any specific person's facts. Check figures against the official sources named here.

Tax year: 2026-27 (1 July 2026 to 30 June 2027). The Income Tax Act, 2026, Tax Administration Act, 2026 and Value Added Tax Act, 2026 commenced on 1 July 2026 and replace the old Cap. 52:01 and Cap. 50:03 regimes.

## Who this applies to

Companies resident in Botswana (registered office or incorporation here, or managed and controlled here) and non-residents with a permanent establishment (s 7(7)).

The rate changed from 22% to 24.5% with the Act. The repealed Act applies to tax years before commencement (s 144(a)). "Tax year" includes a company's accounting period (s 45(8)). Substituted year-ends continue (s 144(c)).

## Rates, bands and thresholds

| Item | Amount | Tax year | Source |
|---|---|---|---|
| Company, general | 24.5% | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (Sch 1 Pt I para 3(d)) |
| IFSC, approved financial operations | 15% | 2026-27 | same (para 3(b)) |
| IFSC, other income | 24.5% | 2026-27 | same |
| Mutual association | 5% | 2026-27 | same (para 3(c)) |
| Mining company other than a diamond mining company in which the Government holds an equity interest | higher of 70 - (1500/X) or 24.5%; X = taxable income as % of gross income | 2026-27 | same (para 3(a)) |
| Non-approved fund | 24.5% | 2026-27 | same (para 4) |
| Non-resident: dividends, repatriated profit, entertainers, capital gain | 10% | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (Sch 1 para 6) |
| Non-resident: interest, royalties, technical fees, director's fees, natural resource amounts | 15% | 2026-27 | same |
| Non-resident: insurance premium | 3% | 2026-27 | same |
| Resident: dividends, interest, director's fees, commission or brokerage | 10% | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (Sch 1 para 7) |
| Resident: construction contracts | 3% | 2026-27 | same |
| Resident: rent | 5% | 2026-27 | same |
| Rent or commission below which no withholding | P48,000 a year | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (Sch 1 Pt II) |
| Construction contract notification | over P50,000, within 30 days | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (s 131(5)) |
| Construction relief, classified contractors | contracts under P2,000,000 | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (s 131(2)(a)) |
| Motor vehicle cost limit | P500,000 | 2026-27 | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (Sch 3 Pt II) |

The 15% approved-manufacturer rate on the BURS Companies page and the 22% rate are not in Schedule 1. A tax agreement made under s 54 of the old Act continues for its term (s 144(h)). Check any manufacturer's approval against s 94.

Rent withholding does not apply to an individual's non-deductible rent or to hotel, motel, guesthouse or lodge payments (s 133(4)). Design, engineering and surveying contracts are outside construction withholding (s 131(2)(b)).

## The base

- Residents: business income is Botswana source unless attributable to a foreign PE (s 8(4)). The old source-only description no longer fits.
- Interest deduction capped at interest income plus 30% of tax EBITDA; excess carried five years, oldest first. Not applied to gross income up to P10,000,000, banks, insurers, IFSC companies, variable rate loan stock companies, s 53 taxpayers, s 90 licensees (s 36).
- Assessed business loss: five years, oldest first (s 37).
- Entertainment 50%; 100% for taxed employee benefits or a core entertainment business (s 35).
- Donations: total at least P1,000, cap 20% of taxable income (s 34).
- Employer retirement contributions: up to 20% of the employee's employment income (s 28).
- Dividend from a resident company to a resident company out of taxed profit: exempt (Sch 2 Pt IV para 2). Old Additional Company Tax mechanics do not appear in the Act.

Depreciation (Sch 3), straight-line or diminishing: motor vehicles, computers, buses under 30 seats, goods vehicles under 7 tonnes, earthmoving 25% or 40%; plant used in manufacturing or farming, heavy vehicles 20% or 30%; furniture, aircraft, others 12.5% or 20%; structural improvements 2.5%. Assets under P3,000: 100%. Preliminary expenditure 25%.

## Deadlines and filing

1. Log in to e-Tax at https://eservices.burs.org.bw/.
2. By the third month of the year, lodge the estimate and pay 25%. Repeat by the 6th, 9th and 12th months (s 127). Under P50,000 estimated tax, no instalments. Withholding credits reduce the estimate.
3. Within four months after the accounting period, lodge return ITA22 SAT with financial statements, ITA201, ITA202 and contract payment details ([BURS returns](https://www.burs.org.bw/index.php/tax/returns)). Nil and loss years file (s 123).
4. Pay the balance the same day (s 125).
5. Withholding: pay within 14 days after the month of payment, with a remittance return and certificate (ss 137, 138). The BURS Payments page still says 15 days; the Act wins.
6. Annual withholding return ITW10 or ITW10A within 28 days after 30 June (s 139).

## Penalties and interest

Interest is 1.5% a month or part month, simple (TAA s 41(2), Regs reg 21). Late filing of an income tax return: the greater of P100 a day (cap P20,000) or 10% of unpaid tax a month; the fixed amount never exceeds the tax on the return (TAA s 101). VAT return: the greater of P50 a day (cap P5,000) or 10% a month. Other documents: P50 a day, cap P5,000. Late payment: the greater of P50 a day or 10% a month (TAA s 102), but reg 33 of SI 90 waives this penalty for 12 months from commencement, which runs to 30 June 2027; interest still runs. False statement made deliberately or recklessly: 75% of the shortfall; any other false or misleading statement: 20%. Add 10 points on a second application and 25 on a third or later; half off on voluntary disclosure before discovery or audit (TAA s 103). Failure to e-file or e-pay where required: P20 manual fee (reg 30). Failure to register: 100% of the tax for the period, or P10,000 a month if none is due (TAA s 98).

A withholding agent is personally liable for tax not withheld (s 138(3)).

## Cross-border points

See [Cross-border](bw-cross-border.md) and [Transfer pricing](bw-transfer-pricing.md).

## Two worked examples that recompute

Example 1. Taxable income P1,000,000 at 24.5% = P245,000. Instalments P61,250.

```oa-check
name: Company P1,000,000
inputs:
  income: 1000000
steps:
  - tax: income * 0.245
  - instalment: tax / 4
expected:
  tax: 245000.00
  instalment: 61250.00
```

Example 2. A decision: is interest capped? Gross income P20,000,000, no interest income, tax EBITDA P4,000,000, interest P1,500,000. Cap P1,200,000, so P300,000 carries forward.

```oa-check
name: Interest cap
inputs:
  ebitda: 4000000
  interest: 1500000
steps:
  - cap: ebitda * 0.30
  - denied: interest - cap
expected:
  cap: 1200000.00
  denied: 300000.00
```

## Ask the client first

- Accounting year-end, and does the period start before or after 1 July 2026?
- Any IFSC certificate or old tax agreement?
- Gross income above P10,000,000?
- Payments to non-residents or contractors?
- Losses brought forward, and from which year?

## Sources

| Source | Link | Read |
|---|---|---|
| Income Tax Act, 2026 (No. 13 of 2026), read: ss 7, 8, 17, 28, 34 to 37, 53, 96, 117, 119, 123 to 144, Schedules 1 to 3; Regulations SI 92 and Commencement Order SI 93 in the same file | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 | 2026-11-01 |
| Tax Administration Act, 2026 (No. 14 of 2026), read: ss 14, 18, 27, 41, 98, 101 to 103; Regulations SI 90 regs 3, 4, 21, 28, 30, 33, 34 in the same file | https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=955:tax-administration-act-2026 | 2026-11-01 |
| BURS Returns page, form names only (page predates the 2026 Acts) | https://www.burs.org.bw/index.php/tax/returns | 2026-11-01 |

Not yet confirmed: which rate applies to an accounting period straddling 1 July 2026 (the Act says the old Act covers earlier years; straddle treatment not read); how pre-2026 losses count against the five-year limit; old approved-manufacturer 15% status after 1 July 2026 under s 94; treaty rates of 5 to 7.5% and the count of about 24 treaties from the old file (no official list opened); ITA22 box numbers.