Sierra Leone denies input tax on digital services bought from suppliers with no local presence

What changed in detail

The Finance Act, 2026 (Act No. 1 of 2026), published as a supplement to the Sierra Leone Gazette Extraordinary Vol. CLXVII, No. 3 of 7 January 2026, amends the Goods and Services Tax Act, 2009. Section 20 of the Finance Act amends section 28(2) of the GST Act — the provision listing acquisitions and expenses for which input tax is not deductible — by inserting a new paragraph (h) immediately after paragraph (g).

The new paragraph applies where the acquisition or expense is incurred in the supply of a digital service by a person who has no physical presence or registered office in Sierra Leone. The test in the clause is the supplier’s presence, not the nature of the service or the identity of the buyer.

Section 1 of the Finance Act provides that, unless otherwise stated, the Act is deemed to have come into operation on 1 January 2026. The Act was passed in Parliament on 25 November 2025 and signed by the President on 29 December 2025. The same Act adds a registration trigger for those suppliers at section 15(4)(c) and, at section 24, requires them to appoint a Sierra Leone representative.

What it means

The denial and the registration trigger point in opposite directions, and that tension is the thing to plan around. A non-resident digital-services supplier is now required to register and to appoint a local representative — yet tax arising on its supplies is blocked from deduction while it lacks a physical presence or registered office. The cost of the non-resident’s non-presence lands on the buyer.

Practically, the deduction question turns on a fact about the supplier that the buyer does not hold by default. Procurement records built around a supplier’s name and invoice will not answer it; whether that supplier has a Sierra Leone office or registered address will. Expect this to become a vendor-onboarding field rather than a period-end adjustment.