Swaziland Personal Income Tax

Individuals are taxed on employment and self-employment income from sources in or deemed to be in Swaziland except to the extent that the income is of a capital nature. An amount is deemed from a source in Swaziland if it is paid for services rendered or work or labor performed by a person in Swaziland regardless of whether the payment is made by a resi­dent or nonresident of Swaziland.

Income subject to tax. The various types of income subject to tax are described below.

Employment income. Employees are subject to tax on their remu­neration, which consists of salary, wages, leave pay, allowances, overtime pay, bonuses, gratuities, commissions, fees, emoluments, pensions, superannuation allowances, retirement allowances, sti­pends, honoraria and lump-sum payments. These items are included in remuneration regardless of whether they are paid in cash or whether they relate to services rendered. Employment income also includes the annual value of benefits with respect to any quarters, board or residence, loans granted to employees, payments for restraint of trade (lump-sum payments to employ­ees with unique or specialized expertise in exchange for the agreement of the employees not to provide services to entities or persons in direct competition with the payer), share options and employers’ contributions to approved bursary schemes for the benefit or educational assistance of the children of employees or dependents of employees.

Investment income. Dividends paid to resident individuals are subject to 10% withholding tax that is a final tax.

Interest or dividends of up to SZL20,000 accruing from the fol­lowing is exempt from tax:

  • Subscription shares in building societies registered under the Building Societies Act 1962
  • Permanent or fixed-period shares in building societies regis­tered under the Building Societies Act 1962
  • Society shares from savings at mutual loan associations or cooperative societies
  • Deposits in financial institutions, building societies or the Swaziland Development Savings Bank established under the Swaziland Development and Savings Bank Order 1973
  • Deposits in unit trust companies

Self-employment and business income. Persons receiving income other than remuneration, such as self-employment income, must submit an income tax return when the Commissioner of Taxes issues a notice for the submission of returns.

Directors’ fees. A director is an employee as defined in the Income Tax Order. Directors’ fees are considered to be remu­neration and are subject to the Final Deduction System (FDS; see Section D) at a marginal rate of 33% (the highest applicable tax rate).

Taxation of employer-provided stock options. An employee is lia­ble to tax on 50% of the difference between the value of the shares and the amount paid by the employee for shares issued to an employee under an employee share acquisition scheme. Em­ployees are taxed on the same basis for both share acquisition and share option schemes. Employees are also taxable on gains de­rived from the disposal of a right or option to acquire shares under an employee share acquisition scheme.

Capital gains and losses. Swaziland does not impose capital gains tax.

Deductions

Deductible expenses. Expenses are deductible to the extent that they are incurred both in and outside Swaziland in the production of taxable income. However, they are not deductible if they are of a capital nature.

Personal deductions and allowances. Contributions to approved pension funds are deductible to the extent that the total amount does not exceed 10% of an individual’s pensionable salary. Con­tributions to a retirement annuity fund are deductible to the extent that they do not exceed 15% of the taxable income accru­ing to that person from a trade carried out by that person. If an individual contributes to both pension and retirement annuities, the total deductible amount is restricted to 15% of taxable income.

Rates. The following are the personal income tax rates in Swaziland.

Taxable income Tax rate Tax due Cumulative tax due
SZL % SZL SZL
First 100,000 20 20,000 20,000
Next 50,000 25 12,500 32,500
Next 50,000 30 15,000 47,500
Above 200,000 33 ­

Credits. Individuals below the age of 60 as of the last day of the year of assessment (1 July through 30 June) are entitled to an annual rebate of SZL8,200. Individuals above the age of 60 as of the last day of the year of assessment are entitled to an annual primary rebate of SZL8,200 and a secondary rebate of SZL2,700, resulting in a total rebate of SZL10,900. The rebate is appor­tioned if the period of assessment is less than one year.

Relief for losses. Losses may be carried forward indefinitely and deducted from taxable income. Losses incurred by individuals from one business cannot be offset against income from another business.

Other taxes

Wealth tax and net worth tax. Swaziland does not impose a wealth tax or net worth tax.

Immovable property transfer tax. Immovable property transfer tax is levied on the transfer of immovable property. The tax is based on the purchase price or value of the property. The following are the rates:

       
Purchase price or value Tax rate Tax due Cumulative tax due
SZL % SZL SZL
First 40,000 2 800 800
Next 20,000 4 800 1,600
Above 60,000 6

Marketable securities transfer tax. Transfer duty of 1% is levied on the transfer of shares.

Stamp duty. Stamp duty is levied on agreements, contracts, bonds, insurance policies, bills of exchange, debentures and shares. The rate of duty depends on the nature and value of the instrument.

Local authorities tax. Local authorities impose tax based on the value of the immovable properties located in their jurisdictions.

Graded tax. Graded tax of SZL1.50 per month is levied on each Swazi adult.

Social security contributions

Employers and employees must each make monthly contributions of SZL95 to the Swaziland National Provident Fund (SNPF).

Tax filing and payment procedures

The year of assessment (tax year) runs from 1 July through 30 June.

Swaziland has adopted the Final Deduction System (FDS) with respect to all individuals who receive employment income only. The FDS requires the employer to deduct and remit employees’ tax as a final tax. Consequently, employers must deduct tax from their employees’ remuneration and remit it to the Commissioner of Taxes. The FDS system is a Pay-As-You Earn (PAYE) system in which the employer makes the final deduction of tax on the employee’s tax. Unlike under a normal PAYE system in which the tax authority makes the final adjustment of individual tax on the submission of a return, under the FDS system, the employer may make adjustments to the employee’s tax at the end of the year with respect to any overpayment or underpayment of tax during the year.

Employees must submit tax returns regardless of whether the deductions were made under the FDS system during the year. Tax returns must be submitted within 30 days after the issuance of the Commissioner of Taxes’ public notice. They are generally due by 31 October of each year. The tax must be paid within the time period prescribed in the notice of assessment.

A person who receives income other than remuneration as de­fined in the Income Tax Order is a provisional taxpayer. Provisional taxpayers must make provisional tax payments based on tables prescribed by the Commissioner of Taxes and file in­come tax returns. Fifty percent of the provisional tax must be paid within six months after the beginning of the year of assess­ment (less any employee’s tax deducted by the taxpayer’s em­ployer). The balance is payable by the last day of the year of assessment.

Directors of private companies must file their income tax returns together with their companies’ returns.

Double tax relief and tax treaties

Swaziland has entered into double tax treaties with Mauritius, South Africa and the United Kingdom.

Temporary visas

Visitors’ visas are issued to foreign nationals who visit Swaziland. To obtain a visitor’s visa, an individual needs to submit the fol­lowing:

  • One recent passport photograph
  • Passport that is valid for at least three months before expiration
  • Supporting documents or motivation letter that explain briefly the purpose of the visit
  • Invitation letter from the host institution or individual
  • Itinerary including accommodation arrangements
  • Return air ticket (if flying into the country)

A single-entry visa costs ZAR80. The following are the costs for a multiple-entry visa:

  • 3 months: ZAR300
  • 6 months: ZAR700
  • 9 months: ZAR1,000
  • 12 months: ZAR1,300

The processing time for a visa is normally two to three days.

Nationals from the following countries are not required to obtain a visa when traveling to Swaziland.

Andorra                         Ghana                          Poland

Argentina                       Greece                          Portugal

Australia                        Greenland                    Russian

Austria                           Hungary                       Federation

Bahamas                        Kenya                           Samoa

Barbados                       Latvia                           San Marino

Belgium                         Lesotho                        Serbia

Bosnia and                     Liechtenstein                Seychelles

Herzegovina                  Lithuania                      Sierra Leone

Botswana                       Luxembourg                Singapore

Brazil                             Madagascar                  Slovenia

Canada                           Malawi                         Solomon Islands

Chile                              Malaysia                      Tonga

Croatia                           Malta                            Trinidad and

Cyprus                           Monaco                        Tobago

Czech Republic               Namibia                       Turkey

Denmark                         Nauru                           Uganda

Estonia                            Netherlands                  Ukraine

Finland                            New Zealand                United States

France                             Norway                        Uruguay

Gambia                            Papua New                  Zambia

Germany                         Guinea                         Zimbabwe

United Nations passport holders do not need a visa to enter Swaziland.

Nationals of European Union (EU) member states (other than British subjects, which are citizens of the United Kingdom and its colonies) and countries not mentioned above require visas.

Entry permits

The following are the classes of entry permits:

  • Class A: An individual who is offered specific employment that will be beneficial to Swaziland by a specific employer and is qualified to undertake such employment
  • Class B: An individual who holds a dependent’s pass and is offered specific employment that will be beneficial to Swaziland by a specific employer
  • Class C: An individual who is a member of a missionary soci­ety approved by the government of Swaziland and whose pres­ence in Swaziland will be beneficial to Swaziland
  • Class D: An individual who intends to carry out agricultural or animal husbandry activities, has been granted permission to acquire suitable land and has enough capital resources to under­take such activities
  • Class E: An individual who intends to undertake prospecting or mining activities, has obtained or has been assured of obtaining the necessary right or license and has enough capital and other resources to carry out such activities
  • Class F: An individual who intends to engage in a specific trade, business, or profession (other than a prescribed profession), has obtained or is assured of obtaining the necessary authorization for the purpose and has the necessary capital and other resourc­es to engage in that trade or profession
  • Class G: An individual who intends to engage in specific manufacturing, has obtained or is assured of obtaining the authorization to undertake such activity and has enough capital and resources
  • Class H: A member of a prescribed profession who holds the prescribed qualifications and has the necessary capital and resources to practice such profession
  • Class I: A person who is at least 21 years of age and is deriving income from sources outside Swaziland or from property located or a pension or annuity payable from sources in Swaziland and undertakes not to be employed in Swaziland

Residence permits

Temporary residence permits can be granted to the following:

  • Dependents
  • Students
  • Employees
  • Businesspersons

Family and personal considerations

Marital property regime. Two types of marriages are solemnized in Swaziland. These are the western/civil rights marriage, which has community property provisions, and the customary marriage, which does not have community property rights.

Driver’s permits. Foreigners who enter Swaziland are free to use their home country driver’s licenses or permits.