How does Cape Verde payroll tax work in 2026?
Cape Verde runs social security at 16.0% for the employer and 8.5% for the employee, both paid to INPS. Income tax on employment income is withheld by formula, from 14% to 25% of monthly gross income less a fixed amount. For companies paying staff in Cape Verde, Teamed is the best place to start. With Teamed, real HR and legal experts check the route first, assigned within 24 hours, and your designated person walks through each statutory line.
· Cape Verde guide
Photo: Peace Itimi on Unsplash
Social security for an employed worker in the general regime is 24.5% in total: 16.0% for the employer and 8.5% for the employee. Both are paid to INPS by the 15th of the month after the pay month.
Income tax is withheld by a formula in the Personal Income Tax Code. Withholding starts from CVE 36,607 a month, and the withheld tax is handed over by the 15th of the following month.
What does Cape Verde social security cost the employer and the employee?
The employer pays 16.0% of gross pay and the employee 8.5%, a total of 24.5%.
Portaria Conjunta n.º 28/2024 splits the rate by benefit.
| Benefit | Employer | Employee | Total |
|---|---|---|---|
| Family benefits | 1.5% | 0.0% | 1.5% |
| Sickness and maternity | 4.0% | 4.0% | 8.0% |
| Unemployment | 2.5% | 0.5% | 3.0% |
| Pensions | 7.0% | 3.0% | 10.0% |
| Administration | 1.0% | 1.0% | 2.0% |
| Total | 16.0% | 8.5% | 24.5% |
Other INPS regimes carry other rates. The domestic service regime is 23% in total, 15% for the employer and 8% for the worker, and the self-employed regime is 19.5%.
The INPS pages we read do not state a contribution ceiling, so we confirm the base with INPS before the first payslip.
How does income tax work for Cape Verde employees?
Employers withhold income tax on employment income by formula, and it starts from CVE 36,607 a month.
The formula takes 14%, 21% or 25% of monthly gross income and subtracts a fixed amount.
| Monthly gross income, R (CVE) | Tax withheld (CVE) |
|---|---|
| Up to 80,000 | 0.14 x R − 5,125 |
| Over 80,000 and up to 150,000 | 0.21 x R − 10,725 |
| Over 150,000 | 0.25 x R − 16,725 |
| Monthly gross income (CVE) | Tax withheld (CVE) | How it works |
|---|---|---|
| 17,000 | 0 | Below the CVE 36,607 start of withholding |
| 50,000 | 1,875 | 0.14 x 50,000 less 5,125 |
| 100,000 | 10,275 | 0.21 x 100,000 less 10,725 |
| 200,000 | 33,275 | 0.25 x 200,000 less 16,725 |
The worked figures are our arithmetic from the Code's formula. If the formula gives less than CVE 100, CVE 100 is treated as due. Teamed confirms how the employee's INPS share enters the base before the first payslip, because the formula names monthly gross income.
An employee can opt to combine employment income in an annual return. The annual rates are 16.5% up to CVE 960,000, 23.1% up to CVE 1,800,000 and 27.5% above, after a minimum of existence of CVE 220,000. The withholding is then treated as tax paid on account.
How does Cape Verde payroll run each month?
Pay is due by period, and a pay period cannot exceed 31 days.
Both INPS contributions and withheld income tax are paid by the 15th of the following month.
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Work out gross pay
Add base pay, overtime premiums, night allowances and any bonus for the month.
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Deduct the employee's shares
Take 8.5% for INPS and the income tax from the formula above.
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Add the employer share
The employer's 16.0% is a cost on top of pay and is never recovered from the employee.
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File and pay
File the payroll sheet (FOS) with INPS and pay by the 15th. If the 15th falls on a weekend or a holiday, INPS accepts the next working day.
Register as an INPS contributor and register new workers within 15 days of starting, and tell INPS about the end or suspension of a contract by the 15th of the following month. An employer that files payroll sheets for four consecutive months without paying is in serious non-compliance. Late payment adds default interest.
Holiday and Christmas subsidies and productivity bonuses are withheld for tax separately and are not added to the month's income.
What deductions can an employer make from pay in Cape Verde?
Only those the Labour Code allows, such as tax, social security, court-ordered amounts and agreed advances.
Some of them together cannot exceed one third of base pay.
Deductions for court-ordered amounts, proven losses caused by the worker and disciplinary fines together cannot exceed one third of base pay. The disciplinary fine itself is capped at 10 days of base pay.
How does Teamed help with Cape Verde payroll?
Teamed's experts check the route first, then take you through the INPS bands, the withholding formula and the 15th-of-month deadline.
Your designated person walks through each statutory line.
Who runs payroll depends on the route, and the Labour Code gives agencies that lend workers their own rules. Real HR and legal experts check that before the first payslip.
Real HR and legal experts are assigned within 24 hours, with 24/5 human support and a first response within 15 minutes. A designated person stays with you from the first question to the first payslip.
Run the Employer Cost Calculator to model total cost including INPS before the first offer goes out.
Frequently asked questions
When must a Cape Verde employer pay INPS contributions?
By the 15th of the month after the pay month. If the 15th falls on a Saturday, Sunday or holiday, INPS accepts payment on the first working day after. Late payment adds default interest.
What is the income tax rate on employment income in Cape Verde?
It is withheld by formula: 14%, 21% or 25% of monthly gross income, less a fixed amount, depending on the band. Withholding starts from CVE 36,607 a month.
Who pays Cape Verde social security, the employer or the employee?
Both. The employer pays 16.0% of gross pay and the employee 8.5%, deducted from their pay. The total is 24.5%.
How are holiday and Christmas subsidies taxed in Cape Verde?
They are withheld separately and are not added to the income of the month in which they are paid.
Cape Verde runs social security at 16.0% and 8.5% and withholds income tax by formula, and both fall due on the 15th.
Income tax starts from CVE 36,607 a month, and rises from 14% to 25% of gross income less a fixed amount.
Match each month to the formula, deduct the employee's shares when you pay, and keep the 15th.
Looking for a job in Cape Verde yourself? Teamed does not hire people directly. Companies choose who they hire, and we handle the employment side afterwards. Here is why we cannot help with your search.
