Somalia Capital Gains Tax Guide: 0% CGT, No Tax on Gains 2026
Somalia does not impose any capital gains tax (CGT). Gains from the sale of real estate, shares, securities, businesses, or any other assets are entirely tax-free. There is no CGT for either residents or non-residents. Here is how capital gains taxation works in Somalia in 2026.
Capital gains taxation in Somalia is straightforward — there is none. Somalia has no capital gains tax law and no CGT reporting requirements. This makes Somalia one of the most tax-efficient jurisdictions in the world for realizing capital appreciation. Gains from the sale of any type of asset — real estate, shares, businesses, cryptocurrency, intellectual property, or personal property — are entirely exempt from tax. This is a significant advantage compared to neighboring countries where capital gains can be taxed at substantial rates. Property transfer fees →
Real-world example: An individual purchases a property in Mogadishu for USD 100,000 and sells it 2 years later for USD 150,000. Gain: USD 50,000. CGT: SOS 0 (USD 0). A business owner sells their company shares for USD 500,000 (cost basis USD 100,000). Gain: USD 400,000. CGT: SOS 0. Compare this to Kenya where the same real estate gain would be taxed at 5% (if held less than 3 years) = USD 2,500, or Ethiopia where capital gains on shares may be taxed at 30%. Even the 0% CGT on shares in Albania applies only to financial assets — Somalia's 0% applies to everything. Investment income guide →
Capital Gains Tax Rates
- Real estate: 0% — no CGT on any real estate gains, regardless of holding period
- Shares and securities: 0% — no CGT on gains from the sale of shares, bonds, or other financial instruments
- Business assets: 0% — gains on the sale of business assets, goodwill, or entire businesses are tax-free
- Cryptocurrency: 0% — no CGT on crypto gains; no distinction between short-term and long-term holdings
- Personal property: 0% — gains on the sale of vehicles, art, collectibles, or other personal assets are tax-free
The complete absence of CGT applies equally to residents and non-residents. There are no thresholds, exemptions, or holding period requirements — all gains are automatically tax-free.
Property Transfer Costs (Not CGT)
While there is no CGT, property transactions involve certain registration and transfer costs:
- Registration fee: Approximately 2% of the property value paid to the municipality or land registry
- Notary fees: Fees for legal documentation of the transfer
- Stamp duties: May apply to certain legal documents
These are transaction costs, not taxes on the gain. They apply regardless of whether the property was sold at a gain or loss. Detailed property tax guide →
Comparison with Regional CGT Regimes
- Somalia: 0% CGT on all assets — no tax on capital appreciation
- Kenya: 5% CGT on real estate (reduced from 10% in 2025); 0% on shares listed on NSE
- Ethiopia: 30% CGT on shares (for non-residents); 15% on real estate
- Uganda: 30% CGT on real estate and business assets (indexed for inflation)
- Tanzania: 10% CGT on real estate (residents); 20% for non-residents
- Djibouti: No CGT on shares; real estate gains may be taxable
Do non-residents pay CGT in Somalia?
No. Non-residents selling assets in Somalia are subject to 0% CGT, the same as residents. There are no special rules or withholding requirements for non-residents. The complete absence of CGT applies equally to all sellers regardless of residency status.
How is CGT collected if there is no tax?
Since there is no CGT, no collection or reporting mechanism exists. Sellers do not need to declare capital gains, file CGT returns, or pay any tax on gains. The property registration process involves only transfer fees, not CGT.
Could Somalia introduce CGT in the future?
While the SRA is developing its tax framework, CGT introduction is not currently under active consideration. The government's focus is on building basic tax administration capacity, customs revenue, and potentially introducing a VAT or CIT before considering CGT.