What should I know about the Unique Global Contribution? This is a synthetic tax which combines in a single tax the bulk of the contributions due for the financial year

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What should I know about the Unique Global Contribution?

1. What is this about?

This is a synthetic tax which combines in a single tax the bulk of the contributions due for the financial year and is representative of the following taxes:

• Income tax based on industrial and commercial profits;
• Tax of the minimum tax;
• Patent contribution (replaced by CEL: Law 2018-10 of 30 March 2018)
• Value Added Tax;
• Flat-rate contribution to be borne by employers;
• Tax on the licence of drinking establishments

However, the taxpayer subject to the UGC remains liable for the withholding taxes provided for in Chapter 4 of the General Tax Code. These are essentially:

• Withholding tax on salaries, wages, pensions and annuities paid at source
• Withholding tax on amounts paid to third parties
• Withholding tax on fees
• Withholding tax on income from securities                                                                                                                                                                                                                                             

        2. Who is involved in this type of contribution ?                                                                                                                                                                                                                                  

The UGC applies only to natural persons carrying out goods or services delivery operations, whose annual turnover, including all taxes, does not exceed fifty (50) million CFA francs.

Therefore, legal persons (company and EIG) are not concerned by the UGC.

Also some natural persons are excluded from the GCU. These are:

• natural persons whose activity falls within the category of non-commercial profits (notary, lawyer, doctor, architect, artist, public accountant, ...);
• natural persons carrying out sales, leasing or property management operations;
• natural persons with an annual turnover exceeding FCFA 50,000,000 for persons carrying out goods delivery operations, or FCFA 25,000,000 for persons carrying out services operations;
• natural persons who may be subject to the UGC but who voluntarily opt for the real regime.  In this case, the option must be made on or before January 31 of the taxation year and this option is total and irrevocable.

        3. How is the plate determinated ?

The basis of assessment shall be the turnover determined after assessment by the tax authorities in accordance with the information given on the declaration and the information provided.

The turnover proposed by the staff member responsible for the assessment shall be notified to the taxpayer.

The taxpayer shall then have a period of twenty (20) days from the date of notification to make his observations or acceptance. Failure to reply within the time limit shall be considered as acceptance.

        4. How is the amount of the UGC calculated ?

For service providers, the amount of the Single Global Contribution is determined according to a scale of progressivity per tranche.

This schedule is as follows:

For traders and producers

1. For cement and food retailers

1. For other categories of producers and resellers

NB: The amount of tax payable by the taxpayer is the sum of the amounts resulting from the multiplication of the share of turnover contained in each of the tranches of the scale of its category by the rate corresponding to this tranche.

In no case may the amount to be paid be less than XOF 30,000 for natural persons providing benefits and XOF 25,000 for natural persons trading.

        5. How is the Unique Global Contribution established?

The UGC is established each year taking into account the total turnover from 1 January to 31 December of the previous year (Art.143 CGI).

For example: the UGC for the year 2020 is based on sales from 1 January to 31 December 2019.

It is drawn up by means of a roll and gives rise each year to the payment of instalments to be deducted from the tax due in respect of the year.

Summary table of the payment of the advance payments of the UGC

NB: The natural person whose amount of the GCU does not exceed 100,000 CFA francs must spontaneously pay the tax to which he is liable (before 1 May of each year for the current year)

        6. What are the obligations of the person subject to the UGC?

              6 – 1 Declaration to be used in determining the UGC ?

Before 1 March each year, the taxpayer must file a return with the tax office responsible for the place where the company’s head office or principal place of business is situated.

This statement states, among other things:

• the amount of its purchases from the previous year;
• the total cost value of its stocks on 1 January and 31 December of that year;
• the amount of its sales or turnover from 1 January to 31 December of that year;
• the amount of its professional and private rents;
• the number and power of its commercial or passenger automobiles;
• the area of its agricultural holdings in relation to and the material means employed.

              6 – 2 Accounting obligations specific to the taxable person of the UGC

• ​​​​​​To maintain and represent at any requisition an agent having at least the rank of tax controller, a register summarised by year, presenting the details of its purchases supported by supporting invoices;
• Keep and communicate to the tax authorities a daily newspaper book, which is served on a day-to-day basis and represents the details of its professional revenues.

         7. Penalties incurred

Any taxpayer subject to the UGC who does not provide his declaration within the prescribed time will be automatically taxed (Art.148 UGC).

NB: Where the amount of the tax has been fixed on the basis of inaccurate information, or where an inaccuracy is noted in the documents the keeping or presentation of which is required by law, the determination of the tax actually due shall be made in accordance with the adversarial procedure (Art.149 CGI).