Zimbabwe Payroll Summary 2019

Zimbabwe
Payroll Summary 2019
INTERNAL DOCUMENT
Last updated 10 September 2019

Zimbabwe Payroll Summary 2019
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Table of Contents
1. Introduction 4
1.1 Official currency 4
1.2 Tax year 4
1.3 Revenue service 4
2. Administration and compliance 4

2.1 Employees filing tax returns 4
2.2 Extension of Time 4
2.3 Employers’ records 4
2.4 Extra PAYE payments 5
2.5 Resident Individual 5
3. Treatment of certain classes of employees 5

3.1 Deceased employees 5
3.2 Employees who change employment 5
3.3 Casual or temporary employees 5
3.4 New employees 5
4. Tax Tables 6
5. Tax according to Directive 7
6. Taxable Income 7
7. Fringe Benefits 8
7.1 Use of employer’s motor vehicle 8
7.2 Loans 9
7.3 Accommodation 9
7.4 Furniture 10
7.5 Passage Benefit 10
7.6 Share option Scheme 10
7.7 School fees benefit 10
7.8 Other benefits 10
8. Taxation of loan benefit 11

8.1 What is a loan? 11
8.2 Loan benefit arise? 11
8.3 How is the loan benefit valued? 11
9. Tax Credits 11
9.1 Elderly Person’s Credit 12
9.2 Blind Person’s Credit 12
9.3 Mentally or physically disabled person’s credit 12
9.4 Credit for Cost of Purchasing Invalid Appliances (Residents
Only) 13
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9.5 Medical Aid Expenses (Residents Only) 13
10. Exempt Income 14

10.1 Refunds/Reimbursements 14
10.2 Director’s fees 14
10.3 Income to civil servants 14
10.4 Bonus 14
10.5 Retrenchment Package 14
10.6 Relocation Allowance / Passage Benefit 14
11. Taxation of retrenchment packages 15

11.1 Definitions 15
11.2 Legal Provision 15
11.3 Exemptions 15
11.4 Application of a Tax Deduction Directive 15
11.5 Payment due dates 16
12. Tax deductions 16

12.1 Pension, NSSA and Retirement Annuities Combined. 16
12.2 Arrears Pension 16
12.3 Subscription contributions, Trade Unions and NEC Levy 16
12.4 Tradesman Tools 17
12.5 Donations 17
13. National Social Security – NSSA 17

13.1 Pension and other benefits scheme (NPS) 17
13.2 Contributions 18
13.3 Accident, Prevention and Workers Compensation Scheme
(WCIF) 18
14. National Aids Trust Fund – AIDS Levy 18
15. ZIMDEF – Manpower Development Fund 19
16. Standards Development Levy 19
17. PAYE Calculation 20
18. Africa Support 20
19. Zimbabwe legislation 20
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1. Introduction
1.1 Official currency
Late in February 2019, Zimbabwe introduced a new currency called the Real Time Gross Transfer
dollars or RTGS dollars.
As from 01 August 2019 payroll should be processed in the new currency known as Zimbabwean
dollar.
Currency code is ZWL. Currency symbol is $.
1.2 Tax year
January to December
1.3 Revenue service
Zimbabwe Revenue Authority - ZIMRA

www.zimra.co.zw
2. Administration and compliance
2.1 Employees filing tax returns
Individuals are not required to file returns if they are on the final deduction system of paying tax.
Where an individual receives more than 1 source of income, changes employment during the year
of assessment or terminates employment during the assessment year, he/she is required to submit
a return upon notice to do so by the Commissioner.
For the avoidance of doubt, persons in receipt of income from employment, which has been
subjected to employees’ tax (PAYE) and were employed by the same employer throughout the 12
months of the year, are NOT required to furnish Income Tax returns.
2.2 Extension of Time
The Commissioner may, under certain circumstances, extend the period within which the statutory
returns must be submitted, or the tax must be paid. The Commissioner may accept payment of a
deposit equal to an estimated tax liability where the client is not able to prepare an accurate return
on time.
2.3 Employers’ records
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Employers are required to maintain records showing all remuneration paid or payable, including
benefits and all deductions, in respect of each employee. These records will be inspected from
time to time by Revenue Officers and should be retained for a period of not less than 6 years from
the end of the tax year to which the records relate.
2.4 Extra PAYE payments
An employee may make a written request to his employer for an additional amount of PAYE to be
deducted from his salary, over and above the statutory amount e.g. consider other employment
income earned elsewhere including pension. Such requests must be complied with.
2.5 Resident Individual
An individual shall be deemed to be resident in Zimbabwe if:

 He or she has a normal place of abode in Zimbabwe and is present in the country at any time
during the year of assessment.
 He or she is present in Zimbabwe for one or more periods amounting to 183 days or more in
any 12-month period.
 He or she is an official of the Government of Zimbabwe posted overseas during the year of
assessment.
3. Treatment of certain classes of employees
3.1 Deceased employees
Following the death of an employee, the employer is required to issue a form P6 within 30 days
from the date of payments of any funds due to the deceased employee. A tax return needs to be
submitted for assessment to the nearest ZIMRA office.
3.2 Employees who change employment
When the employee leaves the service of an employer, the employer is obliged to furnish the
employee with the P6 form within 30 days of the employee leaving his employment. The employee
is required to submit a return at the end of the year for assessment by ZIMRA.
3.3 Casual or temporary employees
Where casual labour is employed, PAYE must be deducted in accordance with the tax tables.
3.4 New employees
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Remuneration for new employees who start work during the year will be subject to PAYE in the
normal way using PAYE tax tables with PAYE adjustments done towards the end of the year.
4. Tax Tables
RTGS Tax table – Effective 01 January 2019
Annual tax table for period 01/01/2019 to 31/07/2019
ANNUAL TABLE
Rate
from 0 to 4 200 multiply by 0% Deduct -
from 4 200.01 to 18 000 multiply by 20% Deduct 840
from 18 000.01 to 60 000 multiply by 25% Deduct 1 740
from 240 000.01 and above multiply by 45% Deduct 31 740
Aids Levy is 3% of the Individuals' Tax payable
ZWL Tax Table - Effective 01 August 2019
Pro rata annual tax table for period 01/08/2019 to 31/12/2019
ANNUAL TABLE
Rate
from 0 to 3 500 multiply by 0% Deduct -
USD Tax Table - Effective 01 August 2019
Pro rata annual tax table for period 01/08/2019 to 31/12/2019
ANNUAL TABLE
Rate
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from 0 to 350 multiply by 0% Deduct -

from 350.01 to 1 500 multiply by 20% Deduct 70
5. Tax according to Directive
Withdrawals from an approved pension fund should be taxed based on a directive from ZIMRA.
The employer should apply for such a directive.
Directives must be applied for: Gratuity, Payments from Pensions funds, lump sums and
retrenchments packages.
Employees who earn fluctuating income may apply for a directive. Employees who are employed
by multiple employers at the same time are advised by ZIMRA to apply for a tax directive for the
taxation of the income from the secondary employer. For example, part-time lecturers who may
have primary employment elsewhere.
6. Taxable Income
According to Section 8(1) (a), (b), (c), (f), (n), (r) and (t) of the Income Tax Act (Chapter 23:06),
income includes:
 Salary, gratuity, cash in lieu of leave, retrenchment package, commutation of pension, pension
refund, bonus, wages, overtime pay, fees, stipend, retirement allowance and grant, commission
and annuity.
 Deemed benefits/advantages such as housing, soft loan, education, passage, telephone,
grocery, furniture, entertainment allowance, electricity, water, clothing, transport, holiday
allowances and security services.
 Deemed motoring/vehicle use benefits.
Advances - Advances against salary, bonus or commission constitute remuneration and PAYE
can be deducted. An employer is responsible for the deduction of correct PAYE from any payment
he makes and is also responsible for any under deductions.
Allowances – allowances such as representation, travelling, entertainment and subsistence are

taxable to the extent that they are not expended on the employer’s business. They should be
added to the other income when calculating PAYE. This excludes allowances paid to civil servants.
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Cash allowances for fuel are fully taxable in the hands of the employee.
Arrear Salary (back pay) – arrears of salary, wages, etc. become taxable on the date on which
the decision to pay them is made.
Bonuses and Commission – a bonus or commission is subject to PAYE on the date the amount
is declared or paid whichever is the earlier except where the amount is in the form of a percentage
of the profits, in which event the accounting date becomes the accrual date.
Communication of amounts due under a contract of employment – where an employer

terminates the services of an employee before the expiry date of the contract and pays him the
amount due per contract for the remaining period, the amount is subject to PAYE.
Directors’ fees – directors’ fees are subject to PAYE if the director performs other services as an
employee, i.e. working director. Directors’ fees paid to a non-working director are not subject to
PAYE.
Refund of pension contributions – When an employee withdraws from an approved pension

fund, the employer is required to apply for a tax deduction directive from the nearest ZIMRA office.
PAYE should be deducted in accordance with that directive.
7. Fringe Benefits
All benefits or advantages whatsoever (except where specifically exempted), granted in lieu of or in
the nature of “remuneration” are liable to Employees’ Tax (Pay As You Earn) in terms of the
Income Tax Act. An example is that of a motoring benefit which an employer may offer to an
employee for usage of a motor vehicle as part of the employee’s conditions of employment. The
motoring benefit granted in this case constitutes remuneration and should be subjected to PAYE in
terms of the Income Tax Act.
7.1 Use of employer’s motor vehicle
The value of motoring benefit should be determined based on “cost to the employer”. The cost to
the employer in this case is determined based on a deemed cost which is provided for in the
Finance Act.
The deemed cost basis of valuing the motoring benefit is also mandatory in the sense that the
prescribed amounts are not subject to variation in relation to the running costs or the vehicle’s
value. Calculations of the benefit are based on the engine capacity of the vehicle and are not
subject to apportionment between business and private usage of the vehicle allocated to the
employee. The benefit is, however, reduced proportionally if the employee uses the vehicle for only
part of the tax year.
From 01 January 2019 to 31 July 2019
Deemed motoring benefits
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Deemed Benefit
Engine Capacity
ZWL per year
up to 1500cc 3600
1501cc to 2000cc 4800
2001cc to 3000cc 7200
3001cc and above 9600
From 01 July 2019 to 31 December 2019
Deemed motoring benefits

Deemed Benefit
Engine Capacity
ZWL per year
up to 1500cc 28 800
1501cc to 2000cc 34 400
2001cc to 3000cc 57 600
3001cc and above 76 400
7.2 Loans
Low or Nil interest Loans attract Tax. The deemed benefit is the difference between the Interest
charged by the company and the Interest % published by ZIMRA.
The prescribed interest rates are based on the London Inter–Bank Offered Rates (LIBOR). The
LIBOR rates for other periods can be obtained from the ZIMRA website.
This does not apply to loans for:

 Education
 Technical Training
 Medical Treatment of the employee, his spouse or child
Also see “Taxation of loan benefit” section.
7.3 Accommodation
In terms of section 8(1) (f) of the Income Tax Act, a benefit arises when:
 Employer rent holiday homes or own a holiday home and the employee can use such
accommodation.
 Housing is provided to executives free of rent or at very low rent
 Housing costs, e.g. gardener, maid, water and electricity are paid by the company
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The taxable value in the above scenarios is the cost to the employer. For valuation of quarters or
residences other than those mentioned above, the respective employers may engage and agree
with ZIMRA before determining the benefit.
In cases where the Employer buys a house in another area for their staff member, then the taxable
benefit should be:
 Within the Municipal area:
– The open market rental value
 Outside municipal area:

– The greater of 12.5% of the employee’s salary or 7% of the cost of the house.
7.4 Furniture
8% of the cost of the furniture is the taxable benefit.
7.5 Passage Benefit
The benefit covers the cost borne by an employer on travels by an employee, spouse or children,
which are not for the purposes of the employer’s business. This includes the cost on taking up of
employment or termination of employment where such costs have been previously offered to the
employee.
This means that you can only get an exemption when you first take up employment or on your first
termination of employment with an employer, otherwise, the passage benefit is taxable.
7.6 Share option Scheme
In scenarios where employees can buy shares at a discount price, the employee should be taxed
on the difference between the purchase price and the market value.
7.7 School fees benefit
Where the employer pays school fees for the employee’s children, the cost of the fees payable
becomes taxable in the hands of the employee. In cases where the employer is a school and the
employee’s child is admitted/enrolled at the school without paying school fees or pays fees that are
less than those paid by other students attending the same school, the foregone fees become a
taxable benefit in the hands of the employee. In addition, any school fees discounts or reductions
granted because of the employer-employee relationship become taxable benefits in the hands of
the employee.
7.8 Other benefits
There are several benefits that can be granted to employees. Employers are, therefore, advised to
contact their nearest office for guidance on tax treatment if needed
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8. Taxation of loan benefit
Many fringe benefits granted to an employee under a contract of employment constitute

remuneration and should be subjected to employee tax (PAYE). This section focuses on the
taxation of loan benefits.
8.1 What is a loan?
It is any form of credit whatsoever granted directly or indirectly to an employee, his spouse or child
by or on behalf of the employer or a person associated with the employer. This does not include
any credit granted for the purposes of the education or technical training or medical treatment of
such employee. The exclusion is, however, subject to the satisfaction of the Commissioner
General.
8.2 Loan benefit arise?
A benefit arises where the rate of interest payable on the loan is less than the prescribed rates
which is less than the London Interbank Offered Rate (LIBOR) rate plus five per cent (5%) per
annum and where the amount of the loan exceeds ZWL100. Where the employer charges an
interest rate which is more than the prescribed rate of interest, there is no taxable benefit. A
benefit may also arise where all or a portion of the loan is written off by the employer.
LIBOR rates can be downloaded from the websites:

http://www.moneycafe.com/personal-finance/libor/
http://www.zimra.co.zw/index.php?option=com_content&view=article&id=1183&Itemid=137
8.3 How is the loan benefit valued?
The value of the benefit is determined by computing the difference between the interest rate
charged by the employer and the prescribed rate of interest, multiplied by the loan amount and the
number of days in which the loan is enjoyed.
In cases where the employer advances a loan to an employee and writes off all or a portion of that
loan, both the full amount written off and the computed loan benefit is taxed in the hands of the
employee.
9. Tax Credits
Credits are meant to reduce the tax payable and therefore increase disposable income for the
taxpayer. Credits are designed for specific categories of taxpayer to address special social welfare
needs such as expenses towards improvement or maintenance of health and/or the control of
permanent physical, mental and visual disability.
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If a credit result in negative PAYE, the credit should be limited, and the excess should be carried
over to the next pay period. PAYE may not be negative due to credits given. Any excess in
December fall away.
9.1 Elderly Person’s Credit
Employees over 55yrs - ZWL900 per year.

The Age Credit is granted to employees who attained the age of 55 years prior to the
commencement of the year of assessment. This age limit was reduced from 59 to 55 years by the
Finance (No.3) Act 10 of 2009 with effect from the 8th January 2010.
Where the assessment period is less than 12 months, the amount (credit) shall be reduced
proportionately.
The tax return should be accompanied by proof of the taxpayer’s age in the form of a birth
certificate or national identification card showing the date of birth.
Effective 01 August 2019

This tax credit is ZWL7 200 per year.
9.2 Blind Person’s Credit
The credit for this category is ZWL900.00 per annum spread over 12 months.
To qualify, the person claiming the credit must have medical proof supplied by a specialist medical
practitioner, specifying the degree of his blindness. If an employee becomes blind during the year,
they should be given the full credit of $900, not pro rata.
A non-resident individual who is blind person can claim this credit.

9.3 Mentally or physically disabled person’s credit
The credit for this category is ZWL900.00 per annum spread over 12 months
To qualify, the person claiming the credit must have medical proof supplied by a specialist medical
practitioner, of permanent substantial disability (which excludes blindness, for which a separate
credit is available). Temporary disability such as is caused by injury due to an accident or illness
for which rehabilitation or cure can reverse the condition does not qualify as disability for purposes
of the credit.
If an employee becomes disabled during the year, they should be given the full credit of $900, not
pro rata.
Disabled person’s credit is not applicable to non-residents and blind taxpayers.
When calculating tax credits, note that blindness is not considered a disability. If an employee is
blind and has another disability, then he is entitled to both the Blind person’s credit and the
Disabled person’s credit.
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9.4 Credit for Cost of Purchasing Invalid Appliances (Residents Only)
The credit for this category is 50% of the total cost of the appliance used by the taxpayer, his/her
spouse or any of his/her children including legally adopted children in respect of any of the
following appliances:
 a wheelchair,
 any artificial limb, leg callipers or crutch; or
 any special fitting for the modification or adaptation of a motor vehicle, bed, bathroom or toilet
to enable its use by a person suffering from a physical defect or disability; or
 spectacles or contact lenses
The taxpayer should complete a return and attach evidence of such purchase and proof of the cost
thereof. Please note that this credit is open to residents of Zimbabwe only.
9.5 Medical Aid Expenses (Residents Only)
50% of medical aid expenses paid by the employee can be deducted from income tax.
All contribution or payments made should have been in respect of the taxpayer, his spouse and
children.
The items are included:

 services rendered by a medical or dental practitioner to an employee, his spouse or children;
 drugs and medicine supplied;
 accommodation, maintenance, nursing and treatment in or at hospital, maternity-home,
nursing-home, sanatorium, surgery, clinic or similar institution;
 conveyance by ambulance; and
 Contributions paid to a medical scheme/fund, including medical shortfall.
Medical Shortfall
If an employee belongs to a Medical Aid Scheme, but the Medical Aid Fund does not cover all the
medical costs, the amount paid in by the employee to cover the shortfall qualifies for the Medical
Expenses Credit.
Tax credit amounts for shortfall payments only apply for Main Member and direct family members –
spouse and children.
In submitting a tax return, the taxpayer should attach evidence of the expenses claimed in their
original forms.
To claim the medical expenses credit, the taxpayer must have been ordinarily resident in
Zimbabwe in the period of assessment.
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Medical expenses refer to an amount that has been paid by the employee herself and will not be
refunded from any source whatsoever. If someone else pays for you then you do not get the
credit at all.
10. Exempt Income
10.1 Refunds/Reimbursements
Any amount of reimburse nature is exempt from tax, if proof of such an expense is provided.
10.2 Director’s fees
Director’s fee paid to a non-working director is not subject to P.A.Y.E.
10.3 Income to civil servants
Benefits and allowances paid to civil servants.
10.4 Bonus
With effect from 1 November 2012, exempt bonus or performance-related award is increased from
$700 to a maximum of ZWL1,000.
This applies to any bonus, annual bonuses or performance related awards. If an employee
receives more than one bonus in a year, then the aggregate amount of the bonuses should be
considered for this exemption.
10.5 Retrenchment Package
The exempt portion is the greater of $10,000 or 1/3 of the retrenchment package. However, the
exempt portion is limited to a maximum of $60,000. This is effective from 1 January 2013.
This applies to any severance pay, gratuity or similar benefit received on cessation of employment
due to retrenchment.
Also see “Taxation of retrenchment packages” section.
10.6 Relocation Allowance / Passage Benefit
Relocation allowance (Passage benefit) is exempt if it is paid in connection with either:

 Taking up of employment with an employer
 Termination of such employment with that employer.
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One can only get an exemption when you first take up employment or on your first termination of
employment with an employer.
For each employee you only enjoy the benefit once, but throughout one lifetime he can enjoy that
benefit for as many times as one changes employers. Note that if you go back to a previous
employer then you are no longer covered if you once enjoyed a tax-free relocation allowance.
11. Taxation of retrenchment packages
Retrenchment packages form part of gross income and are subject to income tax like all other
income.
11.1 Definitions
A retrenchment package is a pay off by an employer to an employee who has been laid off due to
restructuring that has rendered the employee’s position redundant. It constitutes pecuniary
payment or the offer of material benefits. A retrenchment package may include any or all the
following, severance pay (cash), gratuity (cash) and other material benefits like motor vehicles,
vehicles, computers, furniture and immovable property (houses and buildings).
11.2 Legal Provision
Section 8 (1) of the Income Tax Act (Chapter 23:06) defines what constitutes “gross income” and
retrenchment packages are brought into taxation under this section. Section 73 of the same Act
provides for the payment of employees’ tax (including tax on retrenchment packages) withheld by
employers.
11.3 Exemptions
The Income Tax Act exempts the greater of ZWL5,000 or one third of up to $45,000 of the amount
of any severance pay, gratuity or similar benefit received on cessation of employment due to
retrenchment, under a scheme approved by the Minister responsible for labour. The amount
determined as legislated will thus not be liable to tax or in other words, will be excluded from the
taxable income.
11.4 Application of a Tax Deduction Directive
On termination of employment an employer determines the respective retrenchment package and

applies to ZIMRA for a tax deduction directive in form NP4. The following information, in respect of
the employee receiving the retrenchment package, should be carefully and accurately filled by the
employer onto the application form:
 First name and surname

 National identity number (which acts as the taxpayer identification number, TIN)
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 Tax year (the period in which the retrenchment accrued or is paid)

 Nature of benefit
 Amount of benefit (based on the open market value of the benefit or property offered as
retrenchment)
 Salary and allowance per annum
The application form should be signed by both the employer or his representative and the
employee. Where the employee is unable to sign the application form, the employer should
indicate this to ZIMRA and may sign on behalf of the employee. The completed application form
should then be submitted to ZIMRA for processing.
On receipt of the application from the employer, ZIMRA will check the correctness and accuracy of
the information on the form and its accompanying attachments before issuing the directive.
11.5 Payment due dates
Once a directive has been issued, the employer should remit the employees tax within the period
stipulated in the 13th Schedule of the Income Tax Act. Failure to withhold and late
remittances/payments of employees’ tax constitutes an offence and attracts penalties and interest.
12. Tax deductions
12.1 Pension, NSSA and Retirement Annuities Combined.
The contribution paid by the employee via the payroll is tax deductible up to a maximum of $ 5400
per annum (with effect 1 November 2009)

This tax deduction is ZWL43 200 per year.
12.2 Arrears Pension
Tax deduction for arrears pension contributions is RTGS$1 800 per year.

This tax deduction is ZWL14 400 per year.
12.3 Subscription contributions, Trade Unions and NEC Levy
Amounts paid to approved associations by employees registered with such an association are tax
deductible.
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(Subscriptions to sporting or recreation clubs is not tax deductible)
Income Tax Act (CAP 23:06) Section 15, Paragraph (s) allows the deduction of subscriptions in
respect of membership of business, trade, technical or professional associations. Note that the
deductions of the fees can be allowed to Clients in employment whether or not it is a condition of
the employer that they be members of any association. The reference to "continued membership"
rules out any allowance in respect of entrance fees. Note also that the subscriptions need not be
related to the trade carried on - e.g., a chartered accountant turned farmer can still claim the
annual subscription to the Institute.
Contributions by employees to industrial councils and trade unions may be allowed in full in terms
of this paragraph.
12.4 Tradesman Tools
The full amount of the tools purchased is tax deductible. The employer should keep the receipts
for at least 6 years.
12.5 Donations
Donations made by an employee to:

 the National scholarship fund;
 the National bursary fund;
 charitable trusts responsible for Social Welfare or Health; or
 the state, for use in purchasing of medical equipment, drugs or hospital construction or
maintenance should be treated as tax deductible.
13. National Social Security – NSSA
Operations by NSSA started in October 1994 with two schemes: The National Pension Scheme
(NPS) and the Workers Compensation Insurance Fund (WCIF) also known as The Accident
Prevention Scheme.
These two schemes cover members in formal employment and are therefore referred to as
occupational schemes.
13.1 Pension and other benefits scheme (NPS)
This is based on a 50/50 contribution from the employers and employees. Workers are entitled to a
number of benefits after contributions for a minimum set period and after meeting the qualifications
of each of the benefits.
This scheme is important as it provides some form of security during retirement, invalidity or death
of a breadwinner who was a member of the scheme.
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It is a compulsory requirement that every working Zimbabwean above the age of 16 years and
below the age of 65 who is in a permanent, seasonal, contract or temporary employment joins this
scheme and contribute towards it. However, domestic workers and the informal sector are not
included.
13.2 Contributions
 The employee contribution rate will be 3.5% of the actual basic salary in the month up to the
maximum limit of $700 per month.
 The employer contribution rate will be 3.5% of employee’s actual basic salary up to a maximum
of $700 per month.
 The maximum employer and employee contribution is $24.50 per month.
Actual basic salary means the basic salary earned by that employee in that month.
If there is any back pay on the basic salary in the reporting month, then it should be added to the
current basic salary for the calculation on the WCIF and NPS.
13.3 Accident, Prevention and Workers Compensation Scheme (WCIF)
The worker's compensation scheme administered by the National Social Security Authority is
intended to cushion employees and their dependants against financial consequences of injuries
caused by work-related accidents.
The scheme is employer-funded insurance that provides financial relief to employees and their
families when an employee is injured or killed in a work-related accident suffers from a work-
related disease or dies from such a disease.
All employers, except for the government, informal sector employers and domestic workers are
required by law to contribute to the scheme.
When an employer commences business he or she is required to go to the nearest NSSA office to
complete registration forms indicating estimated earnings of his or her employees.
The scheme is fully funded by Employers, no employee contributes towards the scheme.
The minimum insurance premium the employer is required to pay will be calculated using a risk
factor related to the line of business the company is involved in.
The premium is calculated as a percentage of the actual basic salary earned by the employees.
The percentage may vary from year to year.
The insurance year runs from January 1 to December 31 every year.
www.nssa.org.zw/
14. National Aids Trust Fund – AIDS Levy
The National Aids Trust Fund (NATF) commonly known as the National Aids Levy was introduced
by the Government in 2000 through the National Aids Council Act Chapter 15/14 of 2000. The Act
mandated individuals and companies in Zimbabwe to pay 3% of their income and corporate tax
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toward the NATF which would be used to finance various programs to respond to the HIV and
AIDs pandemic.
In addition to the PAYE the employee contributes the Aids levy, currently 3% of the PAYE amount
after deducting the applicable credits.
Values deducted should be reported on ZIMRA form P2 as part of the Employer Remittance.
www.nac.org.zw/
15. ZIMDEF – Manpower Development Fund
There has been some degree of confusion regarding your liabilities which are payable in terms of
Section 53 (1) of Manpower Planning and Development Act No 24 of 1994. Levy is calculated as 1
% of the TOTAL GROSS WAGE BILL which includes the following:
 Salaries and wages of all employees and agents;
 Cash in lieu rations;
 Any bonuses paid in terms of a contract of services or for work performed;
 The employer’s pension and medical aid contributions;
 Cost of living, housing, holiday, education, climatic and other allowances of similar nature.
 Leave pay;
 Commissions;
 The value of free food, free quarters, including rent paid on behalf of any employees, electricity,
water and any other remuneration in kind;
 Director’s fees and all other pre-tax emoluments paid to directors;
 Any other remuneration or moneys that may be specified in statutory Instrument in terms of
subsection (2)
The leviable income should exclude Gratuity, Long Service Awards & Retrenchment Package.
Levy is payable on monthly basis and any delay attracts a surcharge and interest.
www.zimdef.org.zw/
16. Standards Development Levy
The Standards Development Fund was established through the Act of Parliament No. 3 of 1987.
The Minister of Industry and Commerce is empowered to impose a levy of 0.5% of the total
remuneration payable by the employer to his employees. The payments are paid four times a year
as follows: due on January 15th, 15th April, 15th July and 15th October each year.
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Only the employer contributes towards this fund.
The amount to be declared as “remunerations” must include:

 Salaries and Wages
 Cash in lieu of rations
 Any bonus paid in terms of a contract of employment
 Cost of living, housing, transport, education and climatic allowances and other allowances of
like nature.
 Leave Pay
 Commission
 Value of free food & free quarters including rent, electricity and water paid on behalf of any
employee and any other remuneration in kind.
 Director’s fees and all other pre-tax emoluments paid to directors.
The main function of the Fund is to collect a levy of 0.5% and distribute it to beneficiaries who are
involved in the development and promotion of standards and quality of goods and services.
The Levy is receipted at the three regional offices: Harare Mutare & Bulawayo
www.miit.gov.zw/
17. PAYE Calculation
A tax calculator is available on Compliance SharePoint.
18. Africa Support
Contact Africa Support for any queries on Zimbabwe legislation.

Telephone Number: 012 420 7102 or Ext: 17102
[email protected]
19. Zimbabwe legislation
More information regarding Zimbabwe legislation is available on Compliance SharePoint.
INTERNAL DOCUMENT
Page 2 of 5
DISCLAIMER
Although care has been taken with the preparation of this document, Sage makes no warranties or
representations as to the suitability of quality of the documentation or its fitness for any purpose
and the client uses this information entirely at own risk.
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Zimbabwe Payroll Summary 2019

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Zimbabwe Payroll Summary 2019

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Zimbabwe

Payroll Summary 2019

Last updated 10 September 2019

2. Administration and compliance 4

3. Treatment of certain classes of employees 5

5. Tax according to Directive 7

8. Taxation of loan benefit 11

9.5 Medical Aid Expenses (Residents Only) 13

10. Exempt Income 14

11. Taxation of retrenchment packages 15

12. Tax deductions 16

13. National Social Security – NSSA 17

14. National Aids Trust Fund – AIDS Levy 18

15. ZIMDEF – Manpower Development Fund 19

16. Standards Development Levy 19

17. PAYE Calculation 20

18. Africa Support 20

19. Zimbabwe legislation 20

1.1 Official currency

1.2 Tax year

1.3 Revenue service

Zimbabwe Revenue Authority - ZIMRA

2. Administration and compliance

2.1 Employees filing tax returns

2.2 Extension of Time

2.3 Employers’ records

2.4 Extra PAYE payments

2.5 Resident Individual

An individual shall be deemed to be resident in Zimbabwe if:

3. Treatment of certain classes of employees

3.1 Deceased employees

3.2 Employees who change employment

3.3 Casual or temporary employees

3.4 New employees

RTGS Tax table – Effective 01 January 2019

Annual tax table for period 01/01/2019 to 31/07/2019

Aids Levy is 3% of the Individuals' Tax payable

ZWL Tax Table - Effective 01 August 2019

Pro rata annual tax table for period 01/08/2019 to 31/12/2019

Aids Levy is 3% of the Individuals' Tax payable

USD Tax Table - Effective 01 August 2019

Pro rata annual tax table for period 01/08/2019 to 31/12/2019

from 0 to 350 multiply by 0% Deduct -

Aids Levy is 3% of the Individuals' Tax payable

5. Tax according to Directive

Allowances – allowances such as representation, travelling, entertainment and subsistence are

Communication of amounts due under a contract of employment – where an employer

Refund of pension contributions – When an employee withdraws from an approved pension

7.1 Use of employer’s motor vehicle

From 01 January 2019 to 31 July 2019

Deemed motoring benefits

From 01 July 2019 to 31 December 2019

Deemed motoring benefits

This does not apply to loans for:

Also see “Taxation of loan benefit” section.

 Outside municipal area:

8% of the cost of the furniture is the taxable benefit.

7.5 Passage Benefit

7.6 Share option Scheme

7.7 School fees benefit