Overview
VAT on digital services was introduced by Law no. 2022-22 on 19 December 2022, effective from 1 April 2024. The decree governing the application of the tax was adopted on 8 November 2023.
Article 355 bis of the General Tax Code (GTC) states that “When, in application of the provisions of article 357 of the GTC, the place of taxation for a digital service supplied by a foreign natural or legal person is located in Senegal, VAT is collected and paid, on behalf of the supplier, by the intermediary who carried out the transaction.”
Release date: April 2024
Key provisions applicable to VAT on ESS |
| Table 1 |
Services in scope |
|
Registration and compliance |
Foreign direct suppliers and digital platform operators benefit from a simplified remote electronic registration procedure. Once registered for VAT in Senegal, a non-resident supplier is obliged to settle, collect and remit VAT on digital transactions and related commissions to the tax department responsible for large companies no later than the 15th day of the month following the chargeable event of the VAT. For non-resident suppliers, the VAT return must include this information:
In the absence of proof that the operator of the foreign platform is duly registered in Senegal, local VAT taxpayers must apply the VAT using the reverse charge mechanism. |
Invoicing |
The taxable person’s invoice must clearly show:
There are no specific requirements on what currency must be used for invoices. As such, invoices can be in any currency. |
VAT on costs |
The VAT borne by foreign service providers cannot be refunded in the absence of VAT collected in return in Senegal. The reverse VAT charge applied by a local entity is deductible only if the conditions set out in decree no. 039532 of 02 December 2021 are met. |
Particulars |
Description |
Scope |
B2B and B2C |
Liability to remit VAT |
|
VAT rate |
18% |
Taxable value |
VAT is charged on the price of digital services and, where applicable, on commissions received by intermediaries. |
Effective date |
1 April 2024 |
VAT registration threshold |
Nil |
Tax invoice |
The issuance of an invoice is compulsory for any profession or activity |
Other considerations |
Information sharing: A company, regardless of its location of residence, which, in its capacity as a platform operator, puts persons in contact at a distance by electronic means with a view to the sale of a good, the provision of a service or the exchange or sharing of goods or services, whatever the nature of the goods or services, must:
|
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