What a tax treaty actually does
A treaty allocates taxing rights between two countries so the same dollar is not fully taxed twice. It does not eliminate tax; it caps withholding rates and defines which country gets the first bite.
For a Delaware Holdco paying an African operating company — or the reverse — the relevant articles are usually business profits, dividends, interest, royalties, and permanent establishment.
Which African countries have a US treaty in force
South Africa, Morocco, Tunisia, and Egypt hold in-force US income tax treaties. Nigeria, Kenya, Ghana, and Rwanda do not.
Where no treaty exists, US-source payments to a foreign entity default to 30% statutory withholding unless the income is effectively connected to a US trade or business.
Withholding rates by payment type
Dividends: 5–15% under treaty, 30% without. Interest: often 0–10% under treaty, 30% without. Royalties (including software and IP licences): 0–10% under treaty, 30% without. Service fees for work performed outside the US are usually not US-source and are not withheld at all — this is the single most common overpayment we correct.
Permanent establishment: the trap
If your Delaware Holdco has employees, an office, or a dependent agent concluding contracts in-country, you may have created a permanent establishment and become taxable locally on attributable profits.
Keep the operating company as the employer of record and route local activity through it under an intercompany services agreement.