Tax on property income in Algeria

INDIVIDUAL TAXATION

Nonresidents are taxed on their Algerian-sourced income. Married couples are taxed separately.

INCOME TAX

Income is taxed at progressive rates.

INCOME TAX 2017

TAXABLE INCOME, DZD (€) TAX RATE
Up to 120,000 (US$952) 0%
120,000 - 360,000 (€2,857) 20%
360,000 - 1,440,000 (€11,429) 30%
Over 1,440,000 (€11,429) 35%
Source: Global Property Guide

RENTAL INCOME
Rental income earned by nonresidents from leasing non-commercial residential properties is subject to income tax. A flat withholding tax rate of 7% applies for the rental of collective habitations. A flat withholding tax rate of 10% applies for the rental of individual habitations. Rental income is exempt from taxation when the tenants are students.

For leasing of commercial properties, a flat withholding tax rate of 15% applies, including residential lease contracts concluded with companies.

CAPITAL GAINS
Nonresidents earning capital gains realized from the sale of real property not connected with business activities are subject to capital gains tax, which is levied at a flat withholding tax rate of 5%.

Capital gains realized from property sales connected with business activities are taxed at progressive income tax rates. Capital gains are computed by deducting acquisition costs and related expenses from the selling price. Capital gains are classified as either short-term assets or long-term assets.

Short-term assets are properties which are sold after three years of ownership or less. For short-term gains, 70% of the capital gains are taxable and are included in the taxable earnings.

Long-term assets are properties held for more than three years of ownership. For long-term capital gains, only 35% of the capital gains are taxable and are included in the taxable earnings.

PROPERTY TAXATION

Property Tax

Property tax is levied at different rates, depending on the property classification. The tax base is the rental value of the property per square meter multiplied by the surface area.

For buildings, the property tax is levied at 3%. For land related to buildings, property tax is levied at progressive rates.

PROPERTY TAX ON LAND

LAND AREA TAX RATE
Up to 500 sq. m. 5%
600 sq. m. - 1,000 sq. m. 7%
Over 1,000 sq. m. 10%
Source: Global Property Guide

CORPORATE TAXATION

INCOME TAX

Income and capital gains earned by companies are generally subject to corporate income tax at a flat rate of 26%. Income-generating expenses are deductible when calculating for the taxable income.

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