Tax Registration and Overview in Myanmar

Every company operating in Myanmar must register with the Internal Revenue Department (IRD) within 90 days of its registration with the Directorate of Investment and Company Administration (DICA). Tax registration can be completed online via the IRD's official website.

Myanmar’s financial year runs from 1 April to 31 March of the following year.

Below is an overview of three major taxes applicable to business entities in Myanmar:

• Personal Income Tax
• Corporate Income Tax
• Commercial Tax

Personal Income Tax

The following table outlines the annual Personal Income Tax rates for Myanmar and foreign individuals:

*Using the official exchange rate of USD 1 = MMK 2,100.

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Furthermore, an individual who receives income from rent is subject to Personal Income Tax at a rate of 10% on that income.

Employers are required to calculate and withhold Personal Income Tax from employee salaries and remit the tax to the IRD within 15 days of making the salary payment. In addition, an annual salary return must be submitted to the IRD by 30 June each year.

Corporate Income Tax

Companies in Myanmar are generally subject to a Corporate Income Tax rate of 22%. However, companies listed on the Yangon Stock Exchange are eligible for a reduced Corporate Income Tax rate of 17%. In contrast, oil and gas exploration and production companies are subject to a higher Corporate Income Tax rate of 25%.

In general, expenditures incurred for the purpose of generating business income are deductible for Corporate Income Tax purposes.

Corporate Income Tax must be paid quarterly in advance, within 10 days after the end of each quarter. In addition, an annual Corporate Income Tax return must be filed with the IRD by 30 June each year.

Commercial Tax

Commercial Tax, similar to Value-Added Tax (VAT) in other countries, is imposed on goods produced and sold locally, services rendered within Myanmar, and goods imported into the country. The applicable Commercial Tax rates are outlined in the table below:

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Similar to VAT, input Commercial Tax can be offset against output Commercial Tax. Taxpayers whose revenue does not exceed MMK 50 million within a 12-month period are exempt from paying Commercial Tax.

Commercial Tax must be paid by the 10th day of the following month. Quarterly Commercial Tax returns must be submitted within one month after the end of each quarter. Additionally, an annual Commercial Tax return must be filed with the IRD by 30 June each year.

Stamp Duties

Stamp duty is levied on various types of legal instruments. Selected applicable rates are outlined below:

• 2% of the amount or value of the consideration for the conveyance of immovable property.
  In addition, immovable properties located in Nay Pyi Taw, Yangon, and Mandalay are subject to an extra 2% stamp duty based on the market value of the property.
• 0.1% of the share value for the transfer of shares.
• 0.5% of the amount or value secured for bonds.

For lease agreements of immovable property, the applicable stamp duty rates are as follows:

• 0.5% of the annual rent value for leases between one and three years.
• 2% of the average annual rent for leases longer than three years.
• A 2% stamp duty also applies to any lease premium.

How we can help you

Our legal team offers comprehensive support in the following areas:

• Advising on tax laws, regulations, and double taxation agreements
• Tax and investment structuring
• Preparation of Corporate Income Tax, Commercial Tax, and Personal Income Tax returns
• Preparation and submission of annual financial reports to the Internal Revenue Department (IRD)
• Conducting taxation due diligence
• Advising on customs duties and import/export procedures