Algeria Corporate Tax - Guide for International Expansion

Are you considering expanding your business operations to Algeria? Understanding the corporate tax landscape is crucial for any company looking to establish a presence in this North African nation.

Algeria operates a comprehensive corporate tax system administered by the Direction Générale des Impôts (DGI), the country's main tax authority. From registration requirements to payment procedures, navigating Algeria's tax obligations requires careful planning and compliance with local regulations.

Whether you're setting up a new subsidiary or expanding existing operations, having the right financial infrastructure is essential. Wise Business can help streamline your international payments and currency management, making it easier to handle tax obligations and business expenses in Algerian dinars.

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This publication is provided for general information purposes and does not constitute legal, tax, or other professional advice from Wise Payments Limited, its subsidiaries or affiliates, and it is not intended as a substitute for obtaining business advice from a tax advisor or any other professional.

Algeria Corporate tax rate in 2025

The standard corporate income tax (CIT) rate in Algeria is 26% for most business activities. According to the Algerian tax system, companies are subject to different rates depending on their activities: 19% for production of goods (manufacturing) activities, 23% for construction, public works, hydraulic activities, and tourism activities (excluding travel agencies), and 26% for all other activities.¹

Algeria continues to offer a reduced corporate tax rate of 10% for reinvested profits, subject to specific conditions outlined in the tax code.¹ However, the additional corporate profit tax applicable to tobacco manufacturing companies has been updated by the 2025 Finance Law: this tax is now 20% for manufacturers of snuff and/or chewing tobacco and 31% for manufacturers of smoking tobacco (including e-cigarettes and hookahs).²

Foreign companies operating in Algeria through permanent establishments are subject to the same corporate tax rates as domestic companies. The tax applies to capital companies (SPA, SARL, EURL), partnerships limited by shares, and single-member limited liability companies. The tax is calculated on the company's net taxable profit, which is determined after deducting allowable business expenses, depreciation, and other permitted deductions under Algerian tax law.¹

Read more about Corporate Tax Planning best practices

How to pay corporate tax in Algeria

Corporate tax payments in Algeria are processed through the Direction Générale des Impôts (DGI), the country's primary tax administration authority. Companies must register with the DGI and obtain a tax identification number before commencing business operations.³

Corporate taxes in Algeria must be paid in Algerian dinars (DZD). Foreign companies operating in Algeria need to convert their financial results into the local currency for tax calculation and payment purposes.

Companies must file their annual Corporate Income Tax (CIT) return before April 30 of the following year. The final CIT payment is due before May 20, after the return is submitted and provisional installments are offset. Payments are made throughout the year via three provisional installments (30% of the previous year's CIT each) due on March 20, June 20, and November 20. Late filing and payment result in penalties and interest charges, which are calculated until the outstanding amount is settled.⁴

Let's consider a practical example: if your company has an annual turnover of DZD 195 million (approximately £1.5 million) and operates with a profit margin of 10%, your taxable profit would be DZD 19.5 million.

At Algeria's standard corporate tax rate of 26%, the tax owed would be:

DZD 19.5 million × 26% = DZD 5.07 million

When expanding your business to Algeria, the right financial tools will make the process smoother. Using a platform like Wise Business makes it easy to manage international finances. A multi-currency account allows businesses to pay for incorporation costs, registration fees, and government taxes in local currency without paying high exchange rate fees.

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Tax Compliance in Algeria

To comply with Algerian tax regulations, companies must understand the key tax obligations and filing requirements set by the General Directorate of Taxes.⁴

Value-Added Tax (VAT)

The standard VAT rate is 19%, with a reduced rate of 9% for essential goods and services. Monthly VAT returns and payments are due by the 20th day of the following month.

Payroll and Property Taxes

Employers must withhold personal income tax (PIT) from salaries at progressive rates up to 35%, and pay training and apprenticeship taxes at 1% of payroll each. Property tax applies annually, with rates based on location.

Tax audits

The tax authority notifies companies before an audit, typically covering CIT, VAT, and turnover declarations. The statute of limitations is four years, and audits often assess non-deductible expenses and transfer pricing accuracy.

International Expansion to Algeria

Algeria can enter your business into Africa, Europe, and the Arab world. As the largest economy in the Maghreb and the fourth largest in Africa, it combines a substantial resource base with growing diversification efforts.⁵

Its economy is primarily driven by hydrocarbons, which account for around 95% of export revenues and 40% of government income.⁶ However, recent reforms promote non-oil sectors through tax breaks, subsidies, and investment credits. This means more renewable energy, telecommunications, tourism, and retail opportunities. The country attracted USD 1.2 billion in FDI inflows in 2023, bringing total inward investment to USD 36.8 billion.⁷

Algeria’s location on the Mediterranean coast is another outstanding perk. It provides direct European access, only two hours by air from major capitals. Its extensive infrastructure (over 112,000 km of roads, 4,200 km of railways, 36 airports, and 11 commercial seaports) supports logistics and trade. A growing middle class and a young population (70% under 30) make Algeria an emerging consumer market full of potential.⁵

The government actively welcomes businesses from around the world. It supports investors through a one-stop investment shop that simplifies administrative procedures. Plus, the country maintains double taxation and bilateral investment protection agreements, offering clarity and legal assurance for foreign entities.

The steps to start a business in Algeria:⁸

• Conduct market research and create a solid business plan.
• Choose a business location, name, and legal structure.
• Register your company with the National Center of Commercial Registry (CNRC).
• Obtain a Tax Identification Number (NIF).
• Register with the National Social Security Fund (CNAS).
• Open a local business bank account.

When you research the business landscape, you may feel a pull to set up your business here. Nonetheless, don’t forget to do the homework, fulfil Algerian corporate tax requirements, and study competition to ensure a firm settlement in the country.

Discover the top 5 best Corporate Tax softwares

Incorporation of Business in Algeria

Businesses must register through the National Center of the Trade Register (CNRC), the government’s official electronic portal for company creation, to incorporate a company in Algeria.

This platform works with the tax authorities, the National Social Security Fund for Employees (CNAS), the Social Security Fund for Non-Employees, and the National Statistical Office (ONS), ensuring a centralised and streamlined registration process. Once validated by the CNRC, the registration is recognised across all relevant administrations.

Documents required for company formation⁹

To complete incorporation, you’ll need the following:

• Copy of identity document and partners’ birth certificates.
• Legalised photocopies of national identity cards for all partners.
• Lease agreement for the company headquarters.
• Proof of share capital deposit (handled by a notary).
• Payment receipts for registration, stamp duty (4,000 DA), and name-reservation fees.
• Auditor’s commitment (approx. 46,800 DA per year).
• Authorisation or provisional approval for regulated professions (if applicable).
• Application forms from the CNRC portal, signed and filed electronically.

The notary plays a central role by drafting the company statutes, handling formalities for share capital, and publishing in the Official Bulletin for Legal Announcements (BOAL).

Business entity types in Algeria⁹

• Natural Person: For small businesses managed by one individual. The owner has full liability for the company's debts.
• Single Limited Liability Company (EURL): A one-person entity with limited liability; the company’s assets are separate from the owner’s personal assets.
• Limited Liability Company (SARL): The most common structure for SMEs. Formed by 2-50 partners, with liability limited to each partner’s capital contribution.
• General Partnership (SNC): Typically family-run, with no minimum capital but unlimited liability for partners.
• Joint Stock Company (SPA): Designed for large enterprises; requires at least seven shareholders and a minimum capital of 1 million DZD (5 million DZD for public companies).
• Simple Limited Partnership (SCS): A hybrid structure with general and limited partners.

International corporate tax best practices

Here are some essential strategies to ensure compliance with local tax laws, optimise tax efficiency, and reduce administrative burdens when operating internationally.

• Stay compliant with local and international tax laws

Complete the legal registration process in every country where your business operates. File all required tax returns on time to avoid penalties, and ensure you stay up to date with local tax laws to remain fully compliant.

Companies should also understand and adhere to global standards set by organisations like the Organisation for Economic Co-operation and Development (OECD). With frameworks like Base Erosion and Profit Shifting (BEPS) and Pillar Two Global Minimum Tax, companies can ensure transparency, prevent tax avoidance, and avoid legal risks.

• Leverage double taxation treaties (DTTs)

DTTs are essential for ensuring that you're not taxed on the same income twice. CFOs and Directors need to have a clear understanding of these treaties between the countries where your business operates and how they can potentially reduce your tax burden. Algeria has concluded more than 30 tax treaties.

• Maintain up-to-date and transparent financial records

Maintaining clear and up-to-date financial records helps companies prepare accurate tax returns, reducing the risk of errors that could lead to penalties. Additionally, having organised financial records simplifies the process during tax audits and regulatory reviews.

Take the complexity out of international expansion with Wise Business

Researching corporate tax is a crucial step when expanding your business into a new country. The next step is setting up the financial infrastructure to handle the complexities of operating across borders, from managing multi-currency cash flow to mitigating FX risk.

The Wise Business account provides the financial tools to make your international expansion to Algeria efficient and simple. It's the one account for managing your money globally.

With a Wise Business account, you can:

• Pay suppliers and initial fees: Pay suppliers, global payroll, and one-off incorporation costs in the local currency.

• Get paid like a local: Use local account details for 8+ major currencies to easily receive payments from customers or investors.

• Manage your money across borders: Hold and exchange 40+ currencies in one account, always with the mid-market exchange rate and low, transparent fees.

• Streamline your accounting: Integrate with tools like Xero or QuickBooks to simplify tracking your company's international finances.

• Empower your team: Provide multi-user access for your finance team and issue expense cards for international spending.

Wise is designed to support every step of your journey, from paying your first registration fee to receiving international payments and managing your global treasury.

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FAQs - Corporate tax in Algeria

Who is liable for corporate tax in Algeria?

Companies liable for corporate tax in Algeria include capital companies (SPA, SARL, EURL, partnerships limited by shares), single-member limited liability companies, partnerships that have opted for corporate tax taxation, and civil companies that have opted for corporate tax taxation. Companies excluded from corporate tax include partnerships that have not opted for corporate tax taxation and certain investment schemes.

Are there any tax incentives for businesses in Algeria?

Algeria offers various tax incentives for businesses, particularly a reduced corporate tax rate of 10% for reinvested profits according to specific conditions. This rate applies to results for fiscal years 2022 and subsequent years. Additionally, there are sector-specific rates with lower taxation for production activities (19%) compared to other business activities. The Investment Code provides certain general guarantees and incentives, including 10-year corporate tax and property tax exemptions if certain requirements are met.

What is the tax treatment of dividends in Algeria?

Dividends paid by an Algerian company to another Algerian company are not subject to withholding tax and are exempt from tax in the hands of the recipient. Dividends paid to resident individuals are subject to a withholding tax of 15%. Dividends and distributions of profits paid to a nonresident company or individual are subject to a 15% withholding tax, unless the rate is reduced under a tax treaty.

What is the process for registering for corporate tax in Algeria?

Companies must register with the Direction Générale des Impôts (DGI) as part of their business establishment process. The Algerian tax system is declarative, requiring companies to register and declare their tax obligations. Registration duty is levied on the formation of a company at a rate of 0.5% of the capital.

What are the common pitfalls to avoid regarding corporate tax in Algeria?

Common pitfalls include failing to properly declare taxes under Algeria's declarative system, not understanding the different corporate tax rates that apply to different business activities, missing payment deadlines, which result in penalties, and inadequate record-keeping. Companies should also ensure they understand which corporate tax rate applies to their specific business activities and maintain proper transfer pricing documentation, as a penalty of DZD 2 million is imposed for failure to comply with the documentation requirement.

Sources used in this article:

1. PwC Tax Summaries: Algeria Corporate Income Taxes
2. EY: Algeria Enacts 2025 Finance Law with Key Measures Applicable to Corporations
3. Ministry of Finance (MF): Tax Services (French)
4. PwC Tax Summaries: Algeria Tax Administration
5. Embassy of Algeria, Ireland: Advantages of Investing in Algeria
6. U.S. Trade.gov: Algeria Investment Climate Statement
7. Lloyds Bank Trade: Investment in Algeria
8. Algeria Lawyers: Blogs (Business/Legal focus)
9. APIEX (Algerian Agency for Investment Promotion): Business Creation
   Sources last checked 29/10/2025