Employer of record in Togo
Togo is a small West African country bordered by Ghana, Benin, and Burkina Faso, with a coastline along the Gulf of Guinea. The country has a diverse culture, with over 40 ethnic groups, and its capital is Lomé. Togo’s economy is primarily based on agriculture, mining, and services, and it is known for producing phosphate, cotton, and cocoa. Despite its small size, Togo plays a strategic role in regional trade and has a rapidly developing infrastructure.
Employee Benefits
PAID TIME OFF
Annual Vacation: Employees are entitled to annual leave after completing one year of service, in accordance with the Labor Law. This amounts to 30 days of vacation each year, which is accrued at a rate of two and a half days per month. Collective or individual agreements may provide more favorable terms than those stated by law.
Sick Leave: Under the Labor Code, workers are entitled to five days of paid sick leave annually. Long-term sick leave is also provided by the law, but the Inter-professional Collective Agreement offers more generous benefits, including compensation for workers who are absent due to illness. Sick leave benefits are based on the length of service, as follows:
- Workers with less than 12 months of service are entitled to one month of fully paid sick leave.
- Workers with more than 12 months but less than five years of service are entitled to one month of fully paid sick leave and three months of half-paid sick leave.
- Workers with more than five but less than ten years of service receive two months of fully paid sick leave and four months of half-paid sick leave.
- Workers with 10 years or more of service are entitled to four months of fully paid sick leave and two months of half-paid sick leave.
Maternity Leave: During pregnancy and maternity, workers are entitled to free medical and midwifery care. Workers must also be excused from tasks that may endanger their health or that of their child. Maternity leave should last at least 14 weeks, with workers receiving at least two-thirds of their regular income during this period. Workers are protected from dismissal or discrimination while on maternity leave and have the right to return to the same or a similar position. Nursing breaks for breastfeeding are to be provided following the birth.
Paternity Leave: Although the Labor Law does not specify paternity leave, the Inter-professional Collective Agreement allows for two days of paid paternity leave after the birth of a child.
Family Leave: The law does not address paid or unpaid parental leave.
National Holidays: Togo observes 12 public holidays each year, which are paid.
Other Paid Time Off: No additional paid time off is provided by the law.
STATUTORY EMPLOYEE BENEFITS
Unemployment Benefits: There is no statutory unemployment insurance or benefits in Togo.
Workers’ Compensation: Work-related injuries are categorized as follows:
Permanent total incapacity
Permanent partial incapacity
Temporary incapacity
Fatal injuries leading to death
Compensation for permanent total incapacity is set at 85% of an insured worker’s average earnings over the last three months before the disability occurred. In cases of permanent partial incapacity, compensation is based on the assessed degree of disability. For temporary incapacity, workers receive 66.7% of their average earnings, with benefits continuing until the worker recovers or is permanently disabled. In the case of fatal injuries, dependents receive a survivor’s pension.
Social Security Contributions
- Employee: 4% of total covered monthly income, based on the minimum statutory salary of CFA 35,000.
- Self-employed: 16.5% of disclosed monthly earnings, also based on the minimum statutory salary of CFA 35,000.
- Employer: 12.5% of the gross monthly payroll, calculated on the same basis as the employee and self-employed contributions.
Retirement: Workers are eligible for retirement benefits starting at age 60, or 55 in cases of premature physical or mental aging, provided they have at least 15 years of coverage. Early retirement is available at age 55 with at least 15 years of coverage. The old-age pension is calculated at 20% of the worker’s average monthly earnings over the last five years, plus 1.33% for each additional year of coverage beyond 180 months.
Health Insurance: The national legislature has authorized the establishment of a universal healthcare system (l’assurance maladie universelle or AMU) through the Labor Code passed in June 2021. This system will include two tiers of coverage: one for employees in public and private sectors (funded by both employer and employee contributions), and another for the underprivileged, supported by government funds. Covered services include hospitalization, consultations, outpatient care, medications, diagnostics, and transportation, all subject to cost caps.
Private Employee Benefits: Currently, there is no private workers’ compensation in Togo. However, private retirement options and health insurance are available.
PERSONAL INCOME TAX
Tax Year: The tax year in Togo runs from January 1st to December 31st.
Tax Rates: Personal income tax is progressive, ranging from 0.5% to 35%. The tax brackets are as follows:
| Personal income tax | Progressive rates from 0% to 35% |
| From XOF 0 to XOF 900,000 | 0.5% |
| From XOF 900,001 to XOF 4,000,000 | 7% |
| From XOF 4,000,001 to XOF 6,000,000 | 15% |
| From XOF 6,000,001 to XOF 10,000,000 | 25% |
| From XOF 10,000,001 to XOF 15,000,000 | 30% |
| Above XOF 15,000,000 | 35% |
Taxation Method: Togo uses a progressive taxation system.
Double Taxation: Togo has agreements to prevent double taxation with various countries.
Residency Requirements: Foreigners are considered tax residents after living in Togo for at least six months and having a tax domicile in the country.
Payroll Calendars: Payrolls may be issued weekly, bi-weekly, fortnightly, or monthly, with no requirement for a set schedule.
Rebates & Tax Credits: Deductions for public health insurance, social security contributions, and certain other expenses may be claimed as a percentage of net wages. Additional deductions are available for loan interest (on loans for property purchases or repairs) for the first ten years, donations, gifts, subsidies, and dependent relatives (up to CFA 10,000 per month).
EMPLOYEE BENEFITS
Benefits Summary: Employee benefits in Togo include 12 public holidays, 30 days of paid annual leave, five days of sick leave, and 14 weeks of maternity leave.
TAXABLE INCOME & DEDUCTIONS
Taxable Income: Capital gains, which result from asset or real estate sales, are taxed as regular income. Gains from property sales are subject to a 7% tax, while mining permit or license transfers incur a 15% tax.
Allowable Deductions: Contributions to social security and public health insurance are deductible. Taxpayers may also deduct expenses for dependents, real estate-related costs, and costs incurred in earning industrial, commercial, non-commercial, or agricultural profits.
PAYROLL TAXES & EMPLOYER CONTRIBUTIONS
Payroll Taxes: The standard business tax rate is 27%, and employers must also contribute 17.5% of each employee’s gross pay to social security.
Social Security Contributions
- Employee: 4% of monthly earnings
- Self-employed: 16.5%
- Employer: 12.5% of gross payroll
Workers Compensation: Workers compensation includes various types of coverage for injuries, disabilities, and death, with compensation rates based on the severity of the injury or disability.
