How to Run Payroll in Sudan: Employment Taxes & Setup

Milani Notshe

Research Specialist

Last Updated

February 13, 2026

In This Guide

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Running payroll in Sudan involves many moving parts before your team sees money land in their accounts. Each month you need to calculate gross-to-net correctly, apply statutory withholdings and employer contributions, issue compliant payslips, plus file and remit on schedule. If anything slips through the cracks, you could face penalties, back-pay exposure, and unnecessary friction with your people.

If you’re hiring in Sudan, whether you’re building a local presence or expanding your global footprint, this guide is for you. We’ll walk through the choices and compliance requirements that have the biggest impact on your speed and risk, from entity vs. no-entity hiring to worker classification and the statutory bodies you’ll interact with along the way. By the end, you’ll know exactly what to expect and how to keep payroll running smoothly, wherever you’re hiring.

Key Takeaways

Payroll cycle: Employers in Sudan generally process payroll on a monthly basis.

Tax filing: Income tax withholdings and social insurance contributions are typically reported and remitted monthly, though procedures may vary by region.

Employer taxes: Employer obligations include social insurance contributions covering pensions, workplace injury, and other statutory benefits, calculated as percentages of employee wages.

Tax year: Sudan follows the calendar year for tax purposes, from January 1 to December 31.

Payroll processing methods: Payroll is commonly handled in-house or outsourced to providers familiar with Sudanese tax and social security requirements.

How to Choose Your Payroll Structure in Sudan

Expanding into Sudan? Building a compliant payroll setup involves much more than simply paying salaries. You’ll be responsible for employment compliance, monthly tax and social declarations, and mandatory benefits. Even small delays in filings or payments can lead to real penalties.

You have several operating models to choose from to make this easier. The right one depends on your legal footprint, your appetite for risk, and how quickly you need to start hiring. Let’s break down the main options and when to use each.

1. No Local Entity in Sudan: Use an Employer of Record (EOR)

If you don’t yet have a legal entity in Sudan, an Employer of Record is usually the fastest and lowest-risk way to hire. An EOR becomes the legal employer on paper, provides locally compliant employment contracts, and manages payroll under local regulations, while you continue to direct the work and manage performance.

This model is ideal for:

Testing a new market
Hiring your first team members
Scaling a distributed workforce without building local infrastructure,

Why it’s the fastest and least risky option:

You skip the lengthy process (and cost) of setting up an entity.
All local registrations, monthly declarations, and statutory payments are handled by a provider already set up in-country, dramatically reducing your compliance risk.

2. You Have a Sudan Entity: Run In-Country Payroll

If you already operate a local entity, or you’re planning to establish one, running payroll directly gives you maximum flexibility and control. You can set your own policies, design benefits, and align payroll closely with your finance and internal approval processes. But this also comes with greater operational responsibility.

What you’re responsible for:

Registering with relevant authorities and maintaining compliance with statutory bodies (often involving CSS/IPRES or similar local institutions).
Accurately calculating and remitting payroll taxes and contributions every month – plus handling year-end requirements.
Issuing compliant payslips and maintaining audit-ready payroll documentation.

When this option makes sense:

You’re hiring at scale and want payroll fully “in-house,” even if you partner with a local provider for execution.
You need deeper integration with finance systems or custom benefit structures.

If you want to keep the entity but offload the admin, many employers choose global payroll services to handle calculations, filings, and payments while they remain the legal employer.

3. Contractors Only: Use Contractor Management

Paying independent contractors is often simpler than setting up full payroll, especially for short-term or highly specialized work.

However, you need to watch out for misclassification risk. In Sudan, as in many jurisdictions, someone may legally qualify as an employee based on how they work – not what their contract says. If they’re under your direction, working like an employee, you may be responsible for full employer obligations.

When contractor payments work well:

You need specialised expertise for a defined scope or timeframe
The contractor operates independently, not under your control or supervision

You can also use contractor management services to streamline compliant contracts, invoicing, and payments.

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What To Know About Payroll Processing In Sudan

Payroll in Sudan centers on four main obligations: salary tax withholding, social insurance contributions, other statutory levies, and periodic payroll reporting to the Sudan Taxation Chamber and the National Pension and Social Insurance Fund. Your team must calculate and withhold the correct amounts each month, remit them on time, and keep auditable records that align with local employment and tax laws.

Non-compliance can trigger financial penalties, late-payment interest, audits, and in serious cases suspension of tax clearance certificates, which can disrupt banking and contracting. This guide walks you through how to calculate core payroll taxes, understand thresholds, manage filing procedures, and structure your setup whether you operate through your own entity or an Employer of Record, noting that some requirements can vary by sector, location, and workforce size.

Types Of Payroll Taxes In Sudan

In Sudan, payroll taxes are primarily made up of progressive salary tax, mandatory social insurance, and work-related insurance contributions that must be withheld or funded by employers and remitted monthly to the relevant authorities.

Salary (Personal Income) Tax

Salary tax is a progressive tax on employment income withheld by the employer and paid to the Sudan Taxation Chamber. Employees typically face marginal rates from 0% on the lowest band up to around 15% on higher monthly earnings, with the employer responsible for calculating, withholding, and remitting this tax on a monthly basis.

Employers file monthly salary tax returns and pay the withheld amounts, usually by the middle of the following month, and errors or late payments can result in penalties calculated as a percentage of unpaid tax plus interest. Persistent under-withholding or failure to file can trigger audits and assessments based on estimated payroll, which can significantly increase your cost exposure.

Social Insurance Contributions

Social insurance in Sudan funds pensions and related benefits and is administered by the National Pension and Social Insurance Fund. Employer contributions are commonly around 17% of contributory salary, while employees contribute about 8%, both calculated on gross salary up to any applicable ceiling set by regulation.

These contributions are reported and paid monthly, usually alongside salary tax filings, and late or missing payments can lead to surcharges, denial of social security benefits for employees, and difficulties obtaining compliance certificates. Authorities can also disallow unpaid contributions as deductible expenses for corporate tax, increasing your effective tax burden.

Work Injury And Related Insurance

Work injury and occupational risk insurance is a statutory obligation in many sectors, with employers paying a contribution that typically ranges around 1%–3% of payroll depending on risk classification. This contribution is usually borne entirely by the employer and is calculated on insurable earnings without employee co-funding.

Payments are generally due monthly or quarterly to the relevant social insurance or labor authority, and non-compliance can expose your company to both administrative penalties and direct liability for workplace accidents. Maintaining accurate payroll records and correct classification of employees is essential to ensure the right rate is applied and to avoid retroactive assessments.

How To Pay Employees In Sudan

Employees in Sudan are most commonly paid via local bank transfer in Sudanese pounds, although cash payments may still occur in smaller or remote operations. To stay compliant, you should pay in the official local currency, align with contractual pay dates, and ensure that at least one regular monthly payday is respected for full-time staff.

If you do not have a Sudanese legal entity, you can use an Employer of Record to hire and pay staff compliantly, or partner with a local payroll provider while you register your own entity. Payslips should clearly show gross salary, taxable income, salary tax withheld, employee social insurance, any other deductions, employer contributions for reference, and the final net pay, and they should be stored in a way that supports audits and employee queries.

Payment Method: Use local bank transfers in Sudanese pounds as the primary method for paying employees.
Pay Frequency: Set at least one fixed monthly payday and document it in employment contracts and internal policies.
Payslip Content: Include gross pay, taxable base, each deduction line (tax, social insurance, other), employer contributions, and net pay.
Banking Setup: Open a corporate bank account in Sudan and ensure it can process bulk salary files and local tax payments.
No-Entity Hiring: Engage an Employer of Record if you need to hire quickly without establishing a Sudanese company.
Cut-Off Dates: Define internal cut-off dates for timesheets and changes so payroll can be finalized before statutory deadlines.
Record Keeping: Retain payroll records and payslips for the minimum statutory period to support inspections and employee claims.

Payroll Set Up Checklist (Entity Vs No-Entity)

Getting payroll set up correctly in Sudan determines how smoothly you can hire, pay, and stay compliant with salary tax and social insurance rules. Running payroll through your own entity gives you direct control but requires full registration with tax and social insurance authorities, while using an Employer of Record lets you operate compliantly without building that infrastructure on day one.

Your team should map out each registration, data flow, and approval step before the first hire so that salary tax, social insurance, and any sector-specific contributions are calculated and paid on time. The right setup reduces the risk of penalties, cash-flow surprises, and employee dissatisfaction caused by late or incorrect pay.

Incorporation Decision: Decide whether to establish a Sudanese entity or use an Employer of Record based on headcount, timeline, and risk appetite.
Tax Registration: Register the entity with the Sudan Taxation Chamber and obtain a tax identification number for payroll filings.
Social Insurance Registration: Enroll with the National Pension and Social Insurance Fund to obtain employer and employee contribution accounts.
Bank Account Setup: Open a local corporate bank account capable of processing salary and statutory payments in Sudanese pounds.
Payroll Policies: Define pay frequency, overtime rules, allowances, and benefits in line with Sudanese labor law and market practice.
Data Collection: Collect employee identification, contracts, bank details, and social insurance numbers before the first payroll run.
Payroll System: Implement payroll software or a provider that can handle Sudanese tax brackets, social insurance rates, and reporting formats.
Internal Controls: Set up maker-checker approval workflows for payroll calculations, payments, and filings.
Document Retention: Establish a process to store payroll reports, payslips, and filing receipts for the legally required period.
Review Cycle: Schedule periodic reviews to update rates, thresholds, and processes when Sudanese regulations change.

Example Of Salary Tax Calculation

Assume an employee earns a monthly gross salary of 300,000 SDG. You would first determine the taxable income, apply the progressive salary tax brackets, and then calculate both employee and employer social insurance contributions on the contributory salary.

The result is a clear breakdown showing gross pay, salary tax withheld, employee social insurance, net pay, and the employer’s additional social insurance cost. This structure helps your team validate calculations and explain deductions to employees.

Step 1 – Determine Taxable Base: Start with the 300,000 SDG gross salary and adjust for any tax-exempt items or allowances according to local rules.
Step 2 – Apply Tax Brackets: Apply the Sudanese progressive salary tax rates to each portion of the taxable income to calculate total salary tax.
Step 3 – Calculate Social Insurance: Compute employee social insurance at about 8% and employer social insurance at about 17% on the contributory salary.
Step 4 – Derive Net Pay: Subtract salary tax and employee social insurance from gross salary to arrive at net pay.
Step 5 – Record Employer Cost: Add the employer’s 17% social insurance contribution to the gross salary to understand the full employment cost.

Submitting Employee Tax In Sudan

Employee salary tax and social insurance in Sudan are typically submitted monthly using forms and payment references issued by the Sudan Taxation Chamber and the National Pension and Social Insurance Fund. You will need your tax identification number, social insurance registration details, payroll period data, and a breakdown of taxable salaries and contributions for each employee.

Tax Authority Portal: Use the Sudan Taxation Chamber’s prescribed forms or electronic portal where available to declare monthly salary tax.
Social Insurance Office: Submit contribution schedules and payments to the National Pension and Social Insurance Fund via its branches or designated channels.
Bank Transfer: Pay assessed amounts via bank transfer using the correct reference numbers to match payments with filings.
Payroll Provider Filing: Allow your local payroll provider or Employer of Record to file and pay on your behalf under a service agreement.
Reconciliation: Reconcile payment confirmations with payroll reports each month to ensure all employees and amounts are correctly reported.

Payroll Tax Due Dates In Sudan

Tax Type	Due Dates
Monthly Salary (Personal Income) Tax Withholding	Generally due by the 15th day of the month following the month in which salaries are paid.
Employer And Employee Social Insurance Contributions	Generally due by the 15th day of the month following the payroll month.
Work Injury And Occupational Risk Insurance	Commonly due monthly or quarterly, with monthly payments aligned to the 15th of the following month where applied.
Annual Salary Tax Reconciliation	Typically due within the first quarter following the end of the calendar year, often by 31 March.
Annual Social Insurance Reconciliation	Usually due shortly after year-end, commonly by 31 March of the following year.
Withholding Tax On Certain Payments To Individuals	Where applicable, due with the regular monthly withholding cycle, generally by the 15th of the following month.

Running Payroll Processing in Sudan

So, what does it actually take to run payroll in Sudan? It involves calculating monthly salaries, applying the right statutory deductions, and making sure your team gets paid accurately and on time, while staying fully compliant with local tax and labour laws.

Let’s walk through what that looks like in practice:

Monthly Payroll Workflow

Gather all the essentials: hours worked, leave taken, new joiners, leavers, and any salary or benefit changes.
Double-check timesheets, leave balances, overtime, and any variable pay to make sure everything is accurate.
Work out gross earnings, including base salary, bonuses, commissions, and allowances.
Apply mandatory and voluntary deductions, like income tax, pension contributions, benefits, and any company-specific deductions. Then, calculate net pay after all deductions.
Run internal reviews, compare with previous payroll cycles, and get the necessary approvals.
Pay employees via bank transfer and share payslips through email or your payroll system.
Send statutory payments and required reports to tax authorities.
Update your records and ensure payroll entries flow correctly into your accounting system.
Share payroll summaries with finance and address any open questions or discrepancies.

How Playroll Streamlines Processing

Keeping track of all these steps, especially in a new market, is no easy task. Regulations change, requirements shift, and it’s easy for things to fall through the cracks. Playroll makes this effortless by managing the entire payroll process for you: onboarding employees, handling calculations and deductions, issuing payslips, transferring funds in Sudanese Pound, and taking care of statutory filings and compliance.

Income Tax And Social Security In Sudan

Understanding the tax obligations for both employers and employees is crucial when operating in Sudan's business landscape. This section explains how taxes and statutory fees affect payroll and individual earnings in Sudan.

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 18%–22% on top of the employee salary in Sudan. This range mainly reflects social insurance and work injury insurance, which are calculated on contributory salary and must be remitted monthly to the National Pension and Social Insurance Fund and related bodies.

Tax Type	Tax Rate
Employer Social Insurance Contribution	Approximately 17% of contributory salary.
Work Injury And Occupational Risk Insurance	Approximately 1%–3% of payroll depending on risk category.
Employer Contribution To Public Pension (Public Sector Where Applicable)	Commonly around 15%–17% of pensionable salary in public schemes.
Employer Training Or Labor Fund Levies (Sector-Specific)	Typically around 1% of payroll where applicable.
Employer Health Or Medical Insurance (If Statutory Or Collective)	Varies, often around 2%–4% of payroll under mandatory schemes.

Employee Payroll Tax Contributions

In Sudan, the typical estimation for employee payroll contributions cost is around 20%.

Tax Type	Tax Rate
Employee Social Insurance Contribution	Approximately 8% of contributory salary.
Salary (Personal Income) Tax – Lowest Band	0% on income within the tax-free threshold.
Salary (Personal Income) Tax – Lower Band	5% on income within the first taxable band above the threshold.
Salary (Personal Income) Tax – Middle Band	10% on income within the middle band.
Salary (Personal Income) Tax – Higher Band	15% on income within the upper band.
Additional Voluntary Pension Contributions	Optional rate agreed between employee and scheme, often 2%–5% of salary.

Individual Income Tax Contributions

Individual income tax in Sudan is applied on a progressive scale to employment income, with employers acting as withholding agents. The tax is calculated each month based on cumulative or current-period earnings and then reconciled annually where required.

Income Bracket	Tax Rate
0 – 60,000 SDG per month	0%
60,001 – 150,000 SDG per month	5%
150,001 – 250,000 SDG per month	10%
Above 250,000 SDG per month	15%

Pension in Sudan

Pension in Sudan is primarily delivered through the National Pension and Social Insurance Fund, which is financed by mandatory employer and employee contributions on pensionable earnings. Employees may also participate in supplementary occupational or private pension schemes, which can provide additional retirement income on top of the statutory system.

Managing Common Payroll Challenges in Sudan

Global employers operating in Sudan often encounter unique payroll challenges that can affect compliance and efficiency, like navigating evolving tax laws and managing employee data. With a need for real-time accuracy, modern organizations must develop strategies to overcome these challenges effectively. Below, we explore some of the most common payroll hurdles and provide actionable solutions to streamline payroll processes in Sudan.

Maintaining Accurate And Detailed Payroll Reports

Maintaining accurate global payroll reports is often challenging due to currency exchange complexities, data integration issues, and the need to keep employee information up-to-date –including tax information, hours worked, leave balances, and any changes in salary or job status. Generating accurate reports is easy with a comprehensive payroll automation tool that consolidates fragmented data sources, and can keep track of employee payments and deductions.

Keeping up with ever-changing tax laws & Compliance Laws

In Sudan, tax laws and compliance regulations can change frequently, presenting a significant challenge for global employers. Monitoring updates to federal, state, and local tax codes is crucial to avoid non-compliance and costly penalties, but requires significant time and resources. Partnering with local experts or a reputable global HR platform is an effective way to maintain compliance. These services can help employers stay compliant with evolving regulations while freeing up time for more strategic work.

Consolidating Multi-Vendor Payroll Analytics

Managing payroll across multiple vendors often leads to fragmented data and inefficiencies, making it difficult to consolidate analytics. These challenges can hinder decision-making, especially when trying to gain a clear view of workforce costs and trends. To address this, organizations can invest in a centralized payroll management system that unifies data from multiple vendors. A consolidated platform simplifies payroll tracking, ensures data accuracy, and provides actionable insights into payroll expenditures.

Integrating Multiple HR & Payroll Systems

Global companies are prone to using multiple HR or payroll systems across regions, which can easily lead to fragmented payroll data, increasing the risk of delays and errors in employee compensation. To combat this, seamless integration between payroll and other systems is critical.

Payroll management systems that connect with existing HR and financial platforms can help streamline workflows by reducing manual inputs and ensuring that all departments operate with up-to-date, accurate information. In turn, this helps guarantee on-time, accurate payroll, boosting employee satisfaction.

How Playroll Can Streamline Payroll & Taxes In Sudan

Expanding globally is an exciting milestone for any company, but it comes coupled with complex payroll challenges. It doesn’t have to be complicated. At Playroll, our easy-to-implement global payroll management software combines automation with hands-on support to make global payroll truly simple. Here's how Playroll helps:

Multi-Vendor Integration: Our platform syncs seamlessly with your providers and in-house systems to unify global payroll services in one platform.
Standardize Payroll Processes: Unify your operations in one dashboard to ensure payroll is running smoothly globally, with advanced approval flows and reports.
Improve Governance & Compliance: Improve compliance by centralizing all your compliance tasks and processes. Easily track your payment obligations, with digitized audit trails.
Advanced Reporting: Access and configure your data, your way, with a comprehensive suite of payroll analytics and reporting tools.

Disclaimer

THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.

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