Banking, Money and Taxes in Angola

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Money in Angola
Expats are likely to find that banking, money and taxes in Angola can be a little disorientating. While working in the country, expats will probably have to get used to new ways of receiving payment, conducting their banking affairs and paying taxes.
Despite the monetary advantages of living in the country, life in Angola is challenging. The cost of living is the highest in Africa country, and the relative inefficiency of its financial systems can be frustrating.

Angolan currency

Angola’s currency is the Kwanza (Kz or AOA), which is divided into 100 centimos.
  • Notes: 5, 10, 50, 100, 200, 500, 2,000 and 5,000 AOA
  • Coins: 1, 2 and 5 AOA
The kwanza isn’t convertible and it’s illegal to take it out of Angola; so most expats are paid in US Dollars or Euros.

Banking in Angola

One of the first things expats will learn about banking in Angola is that it’s difficult, unnecessary and ultimately undesirable to open an Angolan bank account.
Without speaking Portuguese, dealing with local banks is difficult. Opening a bank account in Angola takes a long time and can be complicated by the amount of paperwork required. Moreover, money is strictly government controlled – any amount can come into the country, but little can leave.
Most expats simply don’t open bank accounts in Angola. Instead, their salaries are paid directly into their home-country account in a foreign currency - usually US Dollars or Euros.

Credit cards, debit cards and ATMs

Expats should reconsider using credit or debit cards or debit cards in Angola, since safeguards against identity theft aren’t always sufficient. If they have to use cards, they should be vigilant in checking their balances online, and making sure all debits reflected in statements are accounted for.
Few ATMs in Angola allow access to foreign accounts – and when they do, the same fraud concerns are present and the charges are exorbitant.
A few hotels and restaurants accept foreign credit cards in Angola, but most places don’t. 

Money in Angola

Without a local bank account, and without ATM access to their overseas funds, expats may wonder how they should be expected to pay for anything. Luckily, they can circumvent these issues.
Expats usually request a cash advance against their salary from their employer.  This way, they receive a portion of their monthly salary in cash, while most of it goes directly into their overseas bank account.
Most companies only allow one or two advances per month, and require prior notification – so it’s important that expats research  the cost of living in Angola before arriving to anticipate their monthly expenses.
Money will be advanced as new, clean bills because old or damaged money can’t be changed into kwanza. Payment is done in 50 or 100 USD or Euro notes, as money changers don’t always accept other notes. Expats should keep this in mind when bringing foreign currency into Angola.

Changing money in Angola

Expats can change foreign currency into kwanza at official bureaux de changes, banks, grocery store change windows and at black market money changers on the street. The best rates are usually offered by official money-changing outlets. Banks don't always have sufficient kwanza to buy dollars, and are best kept as a last resort for changing money.
Expats are warned that they will likely carry more cash than they would ordinarily feel comfortable with. It’s strongly recommended that they invest in a home safe – losing a cash advance could leave them with no immediate access to money.
Fortunately, the expat community in Angola is quite close-knit, and borrowing money  from friends or co-workers is quite common.

Taxes in Angola

Tax equalisation agreements are widespread in Angola, and many expats insist their company offers tax protection as a benefit of their employment contract.
Also called hypo-tax agreements, these arrangements guarantee the employee a specified monthly wage, regardless of the actual deductions that should come off their earnings in both their country of origin and Angola.
Put more simply, the company pays all the employee’s taxes on their behalf and deducts a previously agreed amount from the base salary as compensation. The deducted amount is usually equivalent to the tax the employee would hypothetically have paid if they earned the same amount in their home country.
Countries like Angola – where the cost of living and taxes are so high – could be financially crippling places to work, if not for tax equalisation agreements. Tax protection arrangements are designed to let expats enjoy their high salaries, without fear of being penalised by exorbitant tax.

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