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Prepared by:
Taxpayer Services and Education Department Tenth Edition
August, 2010
A. DIRECT TAXES RATES
N o . TAX SOURCE RESIDENT N O N - R E S I D E N T
1. Corporate Tax: 30% 30%
Companies with perpetual tax loss for 3 0.3% of annual 0.3% of annual
consecutive years as a result of tax incentives turnover turnover
on investment.
For newly listed company to the Dar es Salaam 25% 25%
stock exchange, with at least 30% of its shares
issued to the public for three consecutive years
from date of listing.
Total income of a domestic permanent N/A 30%
establishment
Repatriated income of branch N/A 10%
2. Withholding tax on:
(i) Dividends to company controlling 0% 10%
25% of shares or more.
(ii) Dividends from DSE listed company 5% 5%
(iii) Dividends from other Companies 10% 10%
(iv) Other withholding payments 15% 15%
(v) Interest 10% 10%
(vi) Royalties 15% 15%
(vii) Technical Services fees (Mining) 5% 15%
(viii) Transport (Non resident operator/chatterer
without permanent establishment). N/A 5%
(ix) Rental Income (residential house if exceeds 10% 15%
sh. 500,000/- p.a)
Other (any amount) 10% 15%
(x ) Insurance Premium 0% 5%
(xi) Natural Resource Payment 15% 15%
(xii) Service fees N/A 15%
(xiii) Payment for goods or services made by a 2% of gross 15% of gross
Corparation to persons other than holders of TIN payment payment
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No. TAX SOURCE RESIDENT NON-RESIDENT
3. Disposal of Investment Assets (Capital gains)
Individual asset 10% 20%
c. Shares:
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5. Individual Income Tax
Monthly Income Tax Rate
Where total income does not exceed sh. NIL
135,000/-
Where total income exceeds sh. 135,000/= 14% of the amount in excess of
but does not exceed sh. 360,000/- Shs. 135,000/-
Where total income exceeds sh. 360,000/- Shs. 31,500/- plus 20% of the
but does not exceed sh. 540,000./- amount in excess of Shs. 360,000/-
Where total income exceeds sh. 540,000/- Shs. 67,500/- plus 25% of the amount
but does not exceed sh. 720,000/- in excess of Shs. 540,000/-
Shs. 112,500/- plus 30% of the
Where total income exceeds sh. 720,000/- amount in excess of Shs. 720,000/-
Threshold per annum: Income Shs. 1,620,000/-
Note:
1.For non-resident employees of a resident employer the income is subject to withholding
tax at the rate of 15%. However the total income of a non-resident individual is charged
at the rate of 20%.
2. An employee who makes donation as per section 12 of Education Fund Act, such
donation is exempted from tax. But such exemption is upon approval by the
Commissioner.
6. Benefit in kind
a. Housing: Lower of the:- Market value rental of the premises and the higher of the
following:-
i. 15% of the employees total annual income and
ii. The expenditure claimed as deduction by the employer
in respect of the premises
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b motor vehicle
E n g in e S iz e E n g i n e up t o 5 Greater than 5
years old Tshs. years old Tshs.
Note: Not chargeable where the employer does not claim deduction in respect of the
ownership, maintenance, or operation of the vehicle.
(ii) Where turnover is between 3,000,000/- Sh. 95,000/- Sh. 33,000/- plus
and 7,000,000/- 1.3% of the
turnover in excess
of Sh. 3,000,000/-
(iii) Where turnover is between 7,000,000/- Sh. 291,000/- Sh. 85,000/- plus
and Sh. 14,000,000/- 2.5% of the
turnover in excess
of Sh. 7,000,000/-
(iv) Where turnover is between shs. 14,000,000/- Sh. 520,000/- Sh. 260,000/- plus
and shs 20,000,000/- 3.3% of the
turnover in excess
of Sh. 14,000,000/-
Note: Where turnover exceeds Tshs 20,000,000/- the taxpayer is obliged to prepare
audited financial statements in respect of his/her business.
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8. a Submission of returns and payment of tax for accounts based on calendar year
i. On or before 31st March
ii. On or before 30th June
iii. On or before 30th September
iv. On or before 31st December
* Payments for the other accounting dates are made at the end of every quarter,
depending on one's accounting period.
b. Final returns and payment of tax
Within six months from the end of the accounting period.
c. Late payment of tax:- Shall be charged interest at the prevailing statutory rate
plus 5% per annum.
d. Issuance of receipt:- Any person who receives any payment of Tsh 5000/ or more
in respect of goods or services must issue a receipt and retain it for not less than 5 years
9. Skills and Development Levy:
Note: The gross emoluments include wages, salary, leave pay, sick pay, payment in
lieu of leave, fees, commission, gratuity, bonuses any subsistence, traveling or
entertainment allowances
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transportation equipment, aircraft other self propelling
vehicles, plant and machinery used in manufacturing or
mining operations, specialized public utility plant and
equipment, and machinery or other irrigation installations
and equipment.
Note 1 * Pools of depreciable assets calculated basing on diminishing value balance method.
Note 2 ** Pools of assets calculated basing on straight line method.
B. INDIRECT TAXES
11. Value Added Tax (VAT)
VAT registration threshold:
Taxable turnover exceeding sh. 40 million per annum, or taxable turnover exceeding
10 million attained during three consecutive months.
Description of goods/supplies and services VAT Rates
Supply of taxable goods and services in Mainland Tanzania 18%
Importation of taxable goods and services into Mainland Tanzania 18%
Export of goods and certain services from the United Rep. of Tanzania 0%
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Supply of taxable goods and services to relieved persons are not subjected to VAT
The Government and its Institutions are not relieved from VAT
Goods and services under a technical aid or donor funded projects, voluntary and
charitable organization under existing laws, and special agreements are relieved from
VAT
VAT on capital goods to any person is relieved
VAT Returns and payments:
Local Supplies : Last working day of the month following month of business
Imports: At the time customs duty is due and payable in accordance with the customs
laws.
i. VAT refund on genuine claim: Within 30 days after submission of an authorized
Auditors Certificate of Genuineness.
ii. Regular repayment: Business in a constant refund position may apply for
authorization to lodge claims on a monthly basis.
12. Stamp Duty
Description Rates
i. Conveyance 1% of consideration
Due dates is within 30 days from the date an instrument was signed.
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13. Import Duty
Items Duty Rates
(i). Raw materials, pharmaceuticals and capital 0%
goods, Hand hoes, agricultural implements
(iv) Some senstive items are charged at a higher than 25% rate with the intention of
protecting local industries:
e.g. Yoghurt Milk and Cream containing sweetening matter.
Cane or beet sugar and chemically pure sucrose in solid form
Sacks and bags of a kind used for the packing of goods.
Worn clothing and other worn articles (mitumba).
14. Excise Duty
A. (i) Specific Rates on: Wine, spirits, beer, soft drinks, cigarettes, tobacco and
petroleum products.
(ii) Ad-valorem rates are: 7%, 10%, 20% , 30%and 120% ( 120% imposed on
shopping plastic bags.)
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16. Airport Service Charges
Inter national Travel USD 3 0
Loc al travel ( res ident) Sh. 5 0 0 0 / -
17. Port charges
Res ident traveler Sh. 5 0 0 / -
Non res ident traveler USD 5
18. Motor Vehicle Registration
M otor vehic le regis tration f ees Sh. 1 5 0 ,0 0 0 / -
Motor cycle registration fees Sh. 45,000/-
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21. Export Tax:
20% of the value of hides and skins
A levy of 15% chargeable on raw cashew nuts, computed on FOB value or USD 160 / MT
whichever is higher.
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29. Property rates: Dar es Salaam region:
Provided that the amount chargeable shall not be less than 10,000/=
B. For properties not included in Valuation roll , rates are provided in the first
schedule to the By laws of the respective Local Authority (Temeke, Ilala and
Kinondoni Municipalities)
C. The property rates for other regions will continue to be collected by the respective Local
Authorities.
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Note: This booklet is not a substitute for the respective tax laws.
The tax laws prevail in case of any inadvertent conflict.
The Director,
Taxpayer Services and Education Department,
Tanzania Revenue Authority,
P.O. Box 11491,
Dar-es-Salaam, Tanzania
WATCH OUT!!
“TRA does not condone corruption.
Both involved parties will be prosecuted.”