A Guide to the New Income Tax Act Amendment in Namibia

The Income Tax Amendment Act, 2024, introduces changes to Namibia’s personal income tax structure, with the goal of easing financial pressure on individuals, especially low-income earners. Enacted in September 2024, the amendments apply retroactively from March 1, 2024, covering the entire 2024/25 tax year.

New Personal Income Tax Brackets and Rates

Impact on Individuals

These amendments are set to provide tax relief to individuals, particularly those in lower and middle-income brackets. Because the changes are retroactive, many taxpayers who filed under the previous tax structure may qualify for tax refunds for the 2024/25 fiscal year. Individuals should check with tax authorities to claim any potential rebates. This update, driven by the Ministry of Finance, is designed to reduce the burden on taxable income across various income levels.

Employers, meanwhile, must adjust payroll systems to align with the updated brackets and rates. Proactively communicating these changes to employees and identifying overpayments from earlier in the year are also essential steps for compliance. The amendment also emphasizes that individuals who are registered as taxpayers must ensure their tax status is current for proper application of these adjustments.

As we approach January, the start of the new fiscal year, the pillar of tax reforms will be evident as the amendments begin to take full effect. Employers should prepare to apply the changes in December and ensure all payroll adjustments are made to meet the new taxable income thresholds.

Overall, these updates aim to create a more equitable tax system in Namibia, supporting economic stability and easing the cost of living for many citizens.

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