Lesotho Personal Income Tax

Personal income tax rates and credit

• Resident taxation scale overview — Resident individuals are taxed on a two-band progressive scale of 20% and 30%, with a non-refundable personal tax credit that effectively creates a tax-free amount. Figures below are for the 2025/26 tax year (effective 1 April 2025). (Income Tax Act)
• Lower band rate — 20% on annual chargeable income up to LSL 74,040 percent (Income Tax Act)
• Upper band rate — 30% on annual chargeable income above LSL 74,040 percent (Income Tax Act)
• Threshold where 30% begins — LSL 74,040 per year LSL/year (Income Tax Act)
• Personal (non-refundable) tax credit — LSL 12,672 per year LSL/year (Income Tax Act)
• Personal tax credit (monthly equivalent) — LSL 1,056 per month LSL/month (Income Tax Act)
• Effective tax-free monthly income — Approximately LSL 5,990 per month (income below which the tax credit eliminates PAYE) LSL/month (approx — confirm) (Income Tax Act)
• Non-resident withholding on Lesotho-source income — 25% flat (no deductions / no personal credit) percent (approx — confirm) (Income Tax Act)
• Individual residence test — Generally resident if normally resident in Lesotho, or present in Lesotho for 182 days or more in the tax year (approx — confirm exact day count and tests) (Income Tax Act)
• Fringe benefits tax (employer-borne) — 40% of the taxable value of fringe benefits percent (Income Tax Act)
• Capital gains — No separate CGT — gains on business/investment assets are included in chargeable income and taxed at ordinary rates (Income Tax Act)
• Annual return filing deadline — 30 June following the end of the 31 March tax year (Income Tax Act)
• Late filing / late payment penalty — Additional 22% tax per twelve-month period of default percent (approx — confirm current rate) (Income Tax Act)