Zimbabwe Personal Income Tax

All individuals are subject to income tax on income accrued, or deemed to accrue, from a source in Zimbabwe. Com­pen sation for services rendered in Zimbabwe is deemed to be derived from a Zimbabwean source, regardless of where the pay­ment is made or where the payer resides.

The terms “resident” and “ordinarily resident” are not legisla­tively defined. Residential status depends on the facts and cir­cumstances indicating a degree of presence. For example, a per­son living and working temporarily in Zimbabwe is considered resident but not ordinarily resident, while a transient visitor is considered neither ordinarily resident nor resident.

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

Employment income. Tax is levied on salary, wages and the value of employment benefits.

To calculate income tax liability, the following steps must be fol­lowed:

Step I: Calculate the income tax on the taxable income accord­ing to the tax rate structure set out below.

Step II: Calculate the tax credit entitlement discussed in Personal credits.

Step III: Deduct the amount in Step II from the amount in Step I to determine the income tax payable.

Step IV: Add the 3% AIDS levy to the amount computed in Step III to determine the total amount payable.

Education allowances provided by employers to their employees’ children 18 years of age and younger and all allowances or ben­efits accruing to employees are taxable for income tax purposes, but not for social security purposes. Social security contributions are calculated on basic salaries.

Nonresidents are taxed on their employment income in Zim bab we at the rates described in Rates.

Self-employment and business income. Partners are individually subject to tax on their share of business profits.

Income tax is levied on all income (other than capital gains) received or accrued from a Zimbabwean or deemed Zimbabwean source, less non-capital expenditures incurred in the production of income or for business purposes. Certain specific types of income are exempt from tax.

Income from sources other than employment is generally subject to tax at a rate of 25.75%.

Registered taxpayers and government and statutory bodies must withhold and remit to the Commissioner General 10% of all pay­ments for goods and services unless the payee provides a certifi­cate of clearance from the Zimbabwe Revenue Authority. Amounts withheld are refundable on assessment.

Tax is withheld from payments to nonresident artists or entertain­ers performing in Zimbabwe at a rate of 15%.

Tax at a rate of 20% must be withheld from gross fees paid to non-working directors and from gross payments to freelance insurance agents, insurance brokers and property negotiators. Amounts withheld can be offset against income tax due on quar­terly dates or on assessment.

Nonresidents are taxed on business income at a rate of 25.75%. Withholding tax is imposed on nonresidents at a rate of 15% on fees for technical, managerial, administrative and consulting services. The withholding tax is allowed as a credit against tax assessed at the normal rates. The amount of the credit is limited to the lesser of the tax assessed or the withholding tax.

Directors’ fees. Fees paid to working directors are taxed with other employment income at the rates described in Rates.

Fees paid to non-working directors are included in business income and taxed at a rate of 25.75%. Tax at a rate of 20% that is withheld from payments of the gross fees can be offset against income tax payable on quarterly dates or on assessment.

Investment income. Individuals are subject to a final with holding tax at a rate of 10% on dividends derived from companies listed on the Zimbabwe Stock Exchange, and to a 15% final withhold­ing tax on all other domestic dividends.

Interest paid on deposits with local building societies, banks and other financial institutions is exempt from income tax, but it is subject to a final withholding tax at a rate of 15% or 5%, or 0% on fixed-term deposits for at least 90 days or 1 year, respectively. Individuals aged 55 and older are exempt from withholding tax on the first USD3,000 of such income in each year.

Income from treasury bills and discounted instruments traded by financial institutions is exempt from income tax, but it is subject to a final withholding tax at a rate of 15% at the time of disposal or maturity of the instrument. Individuals aged 55 and older are exempt from withholding tax on the first USD3,000 of such income in each year.

Other interest is not subject to withholding tax. However, Zimbabwean-source interest may be included in business income and taxed at a rate of 25.75%.

Foreign-source dividends and interest paid to individuals who are ordinarily resident are deemed to be from a Zimbabwean source. Foreign-source dividends are subject to income tax at a rate of 20% of gross dividends. Foreign-source interest may be included in business income and taxed at a rate of 25.75%. Credits may be granted for foreign tax withheld on interest income and divi­dends, limited to the amount of Zimbabwe tax on the foreign-source income.

Net rental income is taxed at a rate of 25.75%. Individuals aged 55 and older are exempt from tax on the first USD3,000 of such income in each year.

Nonresidents are taxed on investment income from Zimbabwe sources, other than dividends, at a flat tax rate of 25.75%. For nonresidents, withholding tax is imposed at a rate of 15% on fees and royalties. This withholding tax is allowed as credit against tax assessed at the normal rates. The amount of the credit is limited to the amount of the Zimbabwe tax on the income.

Dividends paid to nonresidents on listed and unlisted marketable securities are subject to a final withholding tax at rates of 10% and 15%, respectively.

Taxation of employer-provided stock options. Employer-provided options to acquire stock at below the stock’s market value are subject to tax as a benefit on the date the options may first be exercised. The benefit is included in remuneration from employ­ment on the exercise date and subject to the Pay-As-You-Earn (PAYE) system at the rates set forth below.

For options granted before and exercised after 1 February 2009, the value of the benefit is the market value of the shares at the date the option is exercised. The benefit is subject to the PAYE system at a rate of 5% plus the 3% AIDS levy.

For options granted after 1 February 2009, the value of the ben­efit is the market value of the shares on the date the option to acquire them is exercised less the sum of the following:

  • The option price paid by the employee
  • The market price of the shares at the date of the offer
  • An inflationary allowance computed by applying to the market price of the shares at the date of the offer the percentage increase in the All Items Consumer Index from the date the option was offered to the date the option was exercised

The benefit is subject to the PAYE system at the normal rates set forth in Rates.

For taxation on the disposal of shares, see Capital gains and losses.

Capital gains and losses. Capital gains derived from sales of mar­ketable securities listed on the Zimbabwe Stock Exchange, unlisted securities and real property, including rights in residen­tial, commercial or industrial stands and membership interests in condominiums, are subject to capital gains tax. Disposals of all specified assets purchased before 1 February 2009 are taxed at a rate of 5% of the gross sale proceeds. Disposals of listed market­able securities after that date are taxed at a rate of 1% of the gross sale proceeds. This 1% tax became a final tax, effective from 1 August 2009. Disposals of other specified assets purchased after 1 February 2009 are taxed at a rate of 20% of the capital gain after deduction of an inflationary allowance of 2.5% per year on the cost from the acquisition date to the disposal date.

The capital gains withholding tax is imposed at the following rates:

  • 15% of the gross proceeds from disposals of real property
  • 1% of the gross proceeds from disposals of listed marketable securities
  • 5% for disposals of unlisted marketable securities

The above taxes are credited against the capital gains tax, except for the 1% tax, which became a final tax, effective from 1 August 2009.

Individuals aged 55 and older are exempt from tax on the sale of their principal private residence and on the first USD1,800 of total proceeds received during the year from the sale of listed and unlisted marketable securities.

Rollover relief is available for sales of real property used in a trade or business if individuals or companies sell business prem­ises and purchase replacement premises or if individuals sell business premises to a company under their control, subject to the condition in both cases that the business continues to be car­ried on in the new premises.

Rollover relief is also available for the sale and replacement of a principal private residence.

Capital losses may be carried forward indefinitely.


Deductible expenses. Pension contributions, up to a maximum annual amount of USD5,400, may be deducted from taxable income. If both pension and retirement fund contributions are made, the maximum combined deduction is USD5,400.

Personal credits. The following tax credits are deductible from basic income tax payable.


Type of credit Amount
Taxpayers 60 years of age and older USD900 per year
Blind or disabled person USD900 per year
Medical expenses, cost of invalid appliances and contributions to medical aid societies 50% of amount

Business deductions. A deduction of 25% of cost is granted for additions to fixed assets, other than land and certain buildings, in the first year of use, and a deduction of 25% of cost is allowed in each of the succeeding three years. Allowable deductions are subject to recapture on the sale or other disposal of such assets.

Rates. The following tax rates apply to employment income for the year ending 31 December 2016.

Annual taxable income (USD) Tax rate (%) Tax due (USD) Cumulative tax due (USD)
First 3,600 0 0 0
Next 14,400 20 2880 2880
Next 18,000 25 4500 7380
Next 24,000 30 7200 14580
Next 60,000 35 21000 35580
Next 60,000 40 24000 59580
Next 60,000 45 27000 86580
Above 240,000 50

A 3% AIDS levy is imposed on the cumulative tax due.

Relief for losses. Losses may be carried forward for six years. Mining losses derived from specific mining locations may be car­ried forward indefinitely. However, they are not deductible from income from other mining locations or from non-mining income. Losses from business or investment activities are not deductible from employment income.

Other taxes

Estate and gift taxes. Estate tax is levied on the estates of all deceased persons with assets located in Zimbabwe or with foreign assets arising from Zimbabwean sources. The family home and a family vehicle are not included in the dutiable value of the estate. The first USD50,000 of the dutiable value is tax free. The rate of the estate tax on the balance of the dutiable value is 5%.

Zimbabwe does not levy gift tax. However, the market value of a donation of marketable securities or real property is subject to capital gains tax (see Section A).

Presumptive tax. Presumptive tax at various rates is imposed on informal traders, cross-border traders, small-scale miners, hair­dressers and operators of commercial waterborne vessels and fishing rigs, taxicabs, omnibuses, specified goods’ vehicles, driv­ing schools, licensed and unlicensed bottle stores and restaurants, as well as on cottage industries (cottage industries are trades or industries involved in furniture making and upholstery or metal fabrication and other industries prescribed in statutory instru­ments). Presumptive tax paid is allowed as a credit against income tax due on assessment.

Social security

Monthly contributions payable by the employee, which are 3.5% of the first USD700 of an employee’s monthly basic monetary earnings, are withheld by employers and paid to the National Social Security Authority monthly, together with an equal amount contributed by the employer.

Tax filing and payment procedures

Employers withhold tax under the Pay-As-You-Earn (PAYE) system.

Individuals employed by a single employer for a full fiscal year are taxed under the Final Deduction System and are not required to file returns unless they receive taxable income from another source.

The tax year in Zimbabwe is the calendar year. Tax returns are issued in March and must be filed within one month after the date of issuance. Late returns may incur penalties.

All taxpayers are required to complete and file annual self-assessment returns before 30 April. Late returns may incur penal­ties.

Nonresidents are generally subject to the same filing require­ments as those applicable to residents, but are usually allowed 90 days to file returns.

Tax must be paid within one month after assessment. The follow­ing are the cumulative quarterly provisional tax payments that must be made during the tax year and the percentages of the estimated annual tax payable:

  • 10% by 25 March
  • 35% by 25 June
  • 65% by 25 September
  • 100% by 20 December

Married persons are taxed separately on all types of income.

Double tax relief and tax treaties

A credit is available for foreign taxes paid, limited to Zimbabwe taxes payable on the underlying foreign-source income.

Zimbabwe has entered into double tax treaties with the following countries.

Botswana*              Germany                       Norway

Bulgaria                    Iran*                              Poland

Canada                    Kuwait*                         Serbia*

Congo                       Malaysia                       South Africa

(Democratic             Mauritius                       Sweden

Republic of)*          Namibia*                      United Kingdom

France                       Netherlands

* This treaty has not yet entered into force.

Temporary entry permits

Entry visas are required for all foreign nationals. The government of Zimbabwe issues single- and multiple-entry visas. Certain categories of visitors (specified by the immigration authorities) are automatically granted entry at the port of entry. Others are re quired to obtain visas before reaching the port of entry.

Visitors’ entry certificates. Visitors’ entry certificates are valid for up to six months and may be obtained on entry. This type of permit does not allow the holder to engage in any work, occupa­tion or activity for gain, unless prior authority is given.

Student and scholars’ permits. A student permit may be issued for the purpose of attending any educational institution other than a school. This type of permit is valid for one year from the date of issue and may be extended for additional periods.

A scholar’s permit authorizes a foreign national to attend any school approved by the Chief Immigration Officer. This type of permit remains valid for a period of one school term from the date of issue and may be extended for further study. The permit remains valid automatically if the scholar remains at the same school for which the scholar’s permit is issued.

The holder of a student or a scholar’s permit may not engage in any gainful occupation except during school holidays.

Business visitors’ permits. Visitors to Zimbabwe on business must enter under business visitors’ permits. This type of permit is valid for six weeks and may be extended by the Chief Immi­gration Officer.

Work permits

The assistance of expatriate experts for a relatively short period is welcome if their skills are not available locally and if the em ployer trains a local substitute.

Any person who wishes to engage in an occupation (including work for gain or in the interests of any business undertaking) in Zimbabwe must obtain a valid temporary employment permit (TEP). TEP holders must train Zimbabweans to develop the skills for which the foreign nationals were admitted. Applications for temporary residence permits (see Section H) must be submitted in conjunction with TEP applications.

A TEP may be issued for a maximum period of three years and may be extended for a maximum period of five years if approved by the Chief Immigration Officer.

A TEP is subject to the following conditions:

  • The permit holder may not engage in any occupation other than the occupation specified.
  • If the permit is issued on application by a particular employer, the holder may not take up employment with any other employer.
  • The holder and all the persons authorized to enter with him or her must leave Zimbabwe on or before the expiration of the period stated in the permit.
  • The permit must be surrendered to an immigration officer before leaving Zimbabwe.

To recruit staff from outside the country, an employer in Zim­babwe must comply with the following procedures:

  • Obtain TEP application forms and temporary residence permit application forms from the Department of Immigration Control.
  • Submit the completed TEP application to the Chief Immi gration Officer together with an offer of employment to the prospective employee. This offer should indicate the salary and conditions of service.
  • Submit an application for a temporary residence permit com­pleted by the prospective employee.

It is government policy to give Zimbabweans precedence over foreign workers; therefore, the employer must justify the employ­ment of an expatriate rather than a Zimbabwean by submitting copies of the following documents:

  • Press advertisements of the position in question
  • Letters from employment agencies indicating that no suitable Zimbabwean is available to fill the position
  • Application letters and résumés received
  • List of all applicants
  • A cover letter from the employer indicating why none of the Zimbabwean applicants is suitable for the position

All applicants for TEPs are referred by the Department of Immi­gration to the Ministry of Public Service, Labor and Social Welfare for approval.

After submission of the application to the Department of Immi­gration Control, the applicant should receive a letter confirming that the documents are in order and are being processed. Delays of one month or more may be expected in processing applications, depending on the volume of work in the ministries concerned. Prospective employees must remain outside Zimbabwe while applications are being considered.

On approval of the permit, the prospective employee is sent a letter confirming the application for a TEP, which must be presented to the appropriate offices of the Department of Immi gration Control at least 14 days after entering the country to obtain the permit. The employee must present the following documents with the letter:

  • Passport
  • Valid radiological certificate of freedom from active pulmonary tuberculosis

All TEP applicants must submit the following items together with the permit application:

  • Two full-face photographs of the applicant, the spouse and each child younger than 18 years of age, if the spouse and children are accompanying the applicant or joining him or her later
  • A certified copy of the birth certificate of the applicant and, if applicable, of the spouse and children
  • One certified copy of the marriage certificate, if married
  • Documentary evidence, in English, of qualifications and expe­rience in the proposed occupation of the applicant

Residence permits

Permission to reside in the country permanently is very difficult to obtain. A residence permit for an indefinite period may be issued to any individual who meets any of the following conditions:

  • He or she is a dependent of a resident who will support the person (dependents may be any close relatives).
  • He or she possesses substantial financial means and will invest in a business venture in Zimbabwe. The following are the investment thresholds in this category:

— USD100,000 if the foreign national is a professional or technical person who is involved in a joint venture with a bona fide Zimbabwean partner.

— USD300,000 if the foreign national wants to introduce a single venture.

— USD1 million if the foreign national wants an unrestricted or indefinite permit for an investment project.

  • He or she holds a TEP and has been resident in Zimbabwe for a continuous period of at least five years.

Personal and family considerations

Family members. An applicant’s spouse and children younger than 18 years of age may be included under a TEP, but a separate work permit must be obtained for a working spouse.

Children younger than 18 years of age may attend school in Zimbabwe if they are included under a parent’s TEP.

Marital property regime. The default marital property regime in Zimbabwe is a separate property system. However, couples may elect into a community property regime. Zimbabwe enforces com­munity property claims brought between spouses married outside Zimbabwe.

Driver’s permits. Most foreign driver’s licenses may be used in Zimbabwe for up to one year after the date of entry into Zim­babwe. After the expiration of this period, a Zimbabwean license must be obtained. The validity of the foreign license is extended to three years for expatriates entering Zimbabwe on government­to-government contracts.

If no driver’s license reciprocity exists between Zimbabwe and the country that issued the foreign license, an international driv­er’s license is necessary. An international driver’s license is valid for two years after the date of entry into Zimbabwe.

To obtain a local Zimbabwean driver’s license, an applicant must first obtain a provisional driver’s license. The provisional license, which is valid for one year, entitles a person to drive a car with learner license plates if he or she is accompanied by a qualified driver. Possession of a foreign driver’s license provides exemp­tion from the requirement to drive with a qualified driver if the Zimbabwean provisional license is obtained within the first year of residence in Zimbabwe.

A competence test taken during the period of validity of the pro­visional license must be passed to obtain a driver’s license.