Laos Corporate Tax Guide 2026

Overview — Corporate Tax in Laos

Corporate tax in Laos is governed by the Tax Law and administered by the Tax Department of Lao PDR. A company is tax resident in Laos if it is incorporated under Laotian law or if its place of effective management is in Laos. Resident companies are taxed on Lao-source income; non-resident companies are taxed only on Lao-source income. The standard tax year is the calendar year. Companies must register for tax with the Tax Department and obtain a tax registration certificate. Semi-annual CIT payments are due by 20 July and 20 January, with the annual return due by 20 January.

Standard Corporate Tax Rate — 20%

The standard corporate income tax rate in Laos is 20% of taxable profits for resident companies. Taxable profit is calculated as gross revenue less allowable deductions including operating expenses, depreciation, interest costs, and losses carried forward. Losses may be carried forward for a prescribed period. Capital allowances (depreciation) are calculated at standard rates prescribed by the Tax Law. Companies must file semi-annual CIT payments and an annual CIT return.

Micro-Enterprises — 5%

Micro-enterprises in Laos benefit from a reduced CIT rate of 5% on taxable profits. A micro-enterprise is defined based on annual revenue, number of employees, and asset thresholds as prescribed by Laotian law. This reduced rate is designed to support small businesses and encourage formalisation of the informal sector. Micro-enterprises may also benefit from simplified accounting and filing requirements under the Tax Law.

Listed Companies — 10%

Companies listed on the Lao Securities Exchange (LSX) benefit from a reduced CIT rate of 10% for the first 10 years after listing. This incentive is designed to encourage companies to access capital markets and improve corporate governance. After the 10-year period, the standard CIT rate of 20% applies. The reduced rate applies to all taxable profits of the listed company, subject to maintaining listing status and compliance with securities regulations.

Tax Depreciation — Capital Allowances

Laos allows depreciation deductions on fixed assets at prescribed rates under the Tax Law. Buildings and structures are depreciated at standard straight-line rates. Plant, machinery, and equipment are depreciated using methods prescribed by the Tax Department. Computer equipment and vehicles have specific depreciation rates. Intangible assets are amortised over their useful life. The Tax Law prescribes minimum and maximum depreciation rates for each asset category.

FAQs

When is the corporate tax filing deadline?

Semi-annual CIT payments are due by 20 July (for the first half) and 20 January (for the second half and annual balance). The annual CIT return is due by 20 January following the end of the calendar year. Late filing attracts penalties under the Tax Law.

Can a foreign company operate through a branch?

Yes, foreign companies may establish a branch in Laos. The branch is taxed at 20% on its Lao-source profits. Branches must register with the Tax Department. Repatriation of branch profits is subject to withholding tax.

What is the thin capitalisation rule?

Laos has thin capitalisation rules that limit interest deductions on related-party loans. The rules are aligned with OECD principles. Excess interest costs may be carried forward.

Are capital gains subject to CIT?

Yes, capital gains are included in taxable income and taxed at the standard CIT rate of 20%. A separate 2% tax applies on transfers of immovable property, classified as income tax on transfer.

Disclaimer

This guide provides general information about Laotian corporate tax for the 2026 tax year. Tax laws and rates may change. Always consult with a qualified Laotian tax advisor or the Tax Department of Lao PDR for advice specific to your situation. InvestmentKit does not provide tax advice.