What about the registration certificate, the tax compliance certificate and the capital gains tax in a land sale in Cameroon?

Launching a real estate project that aims to buy a house or land requires having a perfect knowledge of the requirements related to taxation before really getting started. Thus, buying land is not limited exclusively to preparing a budget for purchasing the property, without taking into account the tax and notarial rules that govern real estate transactions. In Cameroon, any person requesting a purchase or sale of built or unbuilt land must be registered with the tax service, that is to say, hold a registration certificate or unique identifier number (NIU) and be up to date with their tax obligations through a tax compliance certificate (ACF). Thus, when signing the notarial deed of sale, it will be necessary to present an ACF and a NIU to the notary, in addition to the documents that you can find listed in our article on "the procedure for purchasing real estate in Cameroon" which you can find here https://www.nimmo-auto.com/fr/blog/view/4 . It is clear that when we make a profit on a transaction, we must be taxed on it; this is the case for VAT and even more sensitively for capital gains tax.

The tax tools presented above therefore draw their source from the 2024 Finance Act, which requires all taxpayers to provide proof of the regularity of their tax situation in order to benefit from certain prerogatives. But what useful information should you have about these tax documents in the context of a real estate sale and what are the new requirements regarding capital gains tax?

• I. The registration certificate

The registration certificate is the first tax document to obtain, prior to a real estate transaction. It is an identification of the taxpayer which consists of granting him a registration number which must also be unique. Article L 94 in its paragraph 1 of the law mentioned above provides that: "Any natural or legal person liable for a tax, duty or charge, who requests from public or parapublic administrations, a title, a license, a certification, an attestation, an authorization or any approval in the context of the exercise of his activity, must obligatorily mention on his request his unique identifier number (NIU) and attach to it a valid tax compliance certificate. The absence of this document makes his request inadmissible".

• II. The tax compliance certificate

With regard to the tax compliance certificate, Article L 94 bis of the same law specifies that "(1) Any natural or legal person liable for a tax, duty or charge, up to date with respect to the declaration and payment of said taxes, duties and charges, may, upon request, obtain from the tax administration a tax compliance certificate. This certifies that the taxpayer is up to date with his reporting obligations and is not liable for any tax debt due on the date of its issue.

(2) Notwithstanding the provisions of paragraph 1 above, the tax compliance certificate may also be issued to the taxpayer liable for a tax debt when:

- the period provided for in Article L 53 of the Book of Tax Procedures for the payment of the tax debt has not expired;

- the taxpayer benefits from a deferral or moratorium on payment duly granted by the competent authorities. In this case, mention of the tax debt due and the nature of the act suspending proceedings must be made on the tax compliance certificate.

(3) The tax compliance certificate is issued online from the tax administration's computer system. The authenticity of any tax compliance certificate issued electronically is verified by its presence on the list of tax compliance certificates published electronically by the tax administration. The tax compliance certificate is valid for three (03) months from its date of signature. This period is reduced to one (01) month when the taxpayer has benefited from a deferral of payment or a moratorium on his tax debt. "Article L 94 in its paragraph 2 adds that "The tax compliance certificate serves as a tax or non-tax certificate and a tax status statement. It is the only valid document in any administrative procedure as proof of the tax situation of a taxpayer. ".

It is therefore ultimately this document issued by the tax administration that confirms the regularity of the taxpayer's tax obligations. It is now a document required before the notary for the conclusion of a real estate sale.

In any case, whether we are talking about NIU or ACF, it is useful to consult the official tax website at www.impots.cm to obtain them.

• III. Capital gains tax

As for capital gains tax, it should be noted that the legal vocabulary of Gérard Cornu in its 12th edition of 2018, defines capital gains as the increase in the value of a property, from a specific date to another, due to the rise (speculative or not) in the price of land. It can be latent (simple observation of the increase in value without real gain) or realized (gain realized following the sale of a property at a higher price than that which had been paid for its purchase.) It is in this sense that the provisions of subsection 3 of the Finance Act of 2024, dealing with property income, provide in article 90 that "the capital gains referred to in article 46 paragraph 2 are subject to a withholding tax at the rate of 5%, paid at the same time as the registration fees by the notary on behalf of the seller. This rate is increased to 10% when the transaction is carried out in cash. However, the purchaser may also pay the capital gains tax on behalf of the seller". This means that the capital gain can be paid either in principle by the seller or exceptionally by the buyer on behalf of the seller. And to benefit from the low rate of 5%, the transaction must be made by bank transfer, unlike a cash transaction, which requires 10%.

It is important to remember that the ACF and the NIU are not exclusively reserved for the real estate sector. Any natural person with income or requesting one of the services provided for by law from the administration must obtain and present these documents. It is also obvious that failure to comply with tax requirements may result in penalties that we will discuss in other articles.

Keywords:

Certificate of registration or NIU

Certificate of tax compliance or ACF

Capital gains tax