← Taxation Fundamentals for Ethiopian Businesses: Business Tax Management

Withholding Tax Administration

Module 02 / 6 · 60 min

Know which payments carry withholding, compute it correctly under the 2025 rates and thresholds, document it with receipts and a register, remit on time and claim the credits withheld from you.

In this module you will learn to

Identify withholding agents and the transactions subject to withholding
Apply the 3% rate, the ETB 20,000 and ETB 10,000 thresholds and the 30% no-TIN rate
Document each deduction with a receipt and a register line
Remit and report withheld tax on time and manage withholding receivable

Built on

Erudite Africa training curriculum: Taxation Fundamentals for Ethiopian Businesses, Level 2 Intermediate, Business Tax Management (October 2026)
Federal Income Tax Proclamation No. 979/2016 as amended by Income Tax (Amendment) Proclamation No. 1395/2025, and Council of Ministers Income Tax Regulation No. 410/2017 as amended; article references for No. 1395/2025 per KPMG, EY, PwC and Grant Thornton summaries
Value Added Tax Proclamation No. 1341/2024, VAT Regulation No. 570/2025, VAT Registration Directive No. 1104/2025, Directive No. 1021/2024 and Electronic Invoicing System Administration Directive No. 1142/2026
Federal Tax Administration Proclamation No. 983/2016 as amended by Tax Administration (Amendment) Proclamation No. 1434/2026, and Penalty Waiver Directive No. 189/2025
Financial Reporting Proclamation No. 847/2014, Private Organization Employees' Pension Proclamation No. 1268/2022 and Investment Incentive Regulation No. 586/2026

Examples and companies are fictional. Tax rates and rules are shown as they stood when the course was written; always check the current proclamations, directives and guidance from the Ministry of Revenues before filing, and take professional advice for your own case.