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Ethiopia Tax Information

15% VAT

VAT is 15%. TIN required. Registration mandatory above ETB 1 million turnover.

Contractor Services to Invoice

  • Labor charges
  • Material costs
  • Equipment rental
  • Permit fees
  • Subcontractor work
  • Change orders
  • Warranty work

Invoice Requirements in Ethiopia

TIN number
VAT registration
Client TIN
Invoice number
VAT (15%)
Total in ETB

Payment Terms

Progress billing at milestones. Retain 5-10% until final inspection.

CashNet 15Net 30Advance

Payment Methods in Ethiopia

Bank TransferCommercial Bank of EthiopiaTelebirrDashen BankCash

Contractor Invoice Tips

  • Break down materials and labor
  • Reference permits
  • Document change orders
  • Include lien waiver language
  • Track progress payments

Frequently Asked Questions

What tax rate applies to contractor invoices in Ethiopia?

Ethiopia has 15% VAT. VAT is 15%. TIN required. Registration mandatory above ETB 1 million turnover.

What payment methods are common for contractors in Ethiopia?

Common payment methods in Ethiopia include: Bank Transfer, Commercial Bank of Ethiopia, Telebirr, Dashen Bank, Cash. Progress billing at milestones. Retain 5-10% until final inspection.

What should contractor invoices include in Ethiopia?

Your invoice should include: TIN number, VAT registration, Client TIN, Invoice number. For contractor services specifically, also include: Labor charges, Material costs, Equipment rental.

How should contractors bill for projects?

Progress invoicing at milestones. Break down labor, materials, and subcontractor costs.

How do contractors handle material markup?

15-25% markup is standard. State policy in contracts.

What is Ethiopia's VAT rate?

Ethiopia applies 15% VAT on most goods and services. Basic food items and exports are zero-rated.