Botswana Transfer Pricing

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

Any person transacting directly or indirectly with an associate, resident or not (ITA s 117(1)).

Rates, bands and thresholds

Item	Amount	Tax year	Source
Standard	Arm's length conditions	2026-27	https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (s 117)
Low tax entity	effective rate below 15%, or no tax on foreign income, or secrecy	2026-27	https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (s 119)
Attribution trigger	50% or more	2026-27	same
Interest cap	30% of tax EBITDA	2026-27	https://www.burs.org.bw/index.php/tax/tax-laws-2026?download=954:income-tax-act-amendment-2026 (s 36)

The base

BURS may adjust income, deductions, gains, losses and credits (s 117(3)). Method and quantum are as prescribed (s 117(4)); documentation is as prescribed (s 117(5)). A country-by-country report and advance pricing agreements may be prescribed (s 117(7)).

Asset bought from a non-resident associate that bought it from a third party: price is nil unless the taxpayer holds the third party's tax invoice (s 117(6)).

Deadlines and filing

The Act sets no separate transfer pricing return. Keep records eight years (TAA s 14). Adjustments flow through the company return.

Penalties and interest

Interest and shortfall penalties follow the company tax skill.

Cross-border points

Treaty relief: see Cross-border. Substance tests for companies: SI 92 regs 36 to 39.

Two worked examples that recompute

Example 1. Associate fee P1,000,000 against arm's length P700,000: P300,000 added, tax P73,500.

name: Adjustment
inputs:
  paid: 1000000
  arm: 700000
steps:
  - add: paid - arm
  - tax: add * 0.245
expected:
  add: 300000.00
  tax: 73500.00

Example 2. A decision: machine P200,000 from a foreign parent. With the supplier's invoice the cost is deductible at 20% a year; without it, cost is nil.

name: Nil price
inputs:
  cost: 200000
steps:
  - yearly: cost * 0.20
  - tax_value: yearly * 0.245
expected:
  yearly: 40000.00
  tax_value: 9800.00

Ask the client first

• Which associates, and where?
• What was bought, sold or charged?
• Any third-party invoices for assets?
• Group revenue, for any country-by-country duty?
• Existing pricing study?

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

Not yet confirmed: the Transfer Pricing Regulations made under the old Act (not opened; they continue only if consistent, s 144(i)), including thresholds and documentation content; any CbC rule in force.