Withholding Tax (Section 80 of Cap 23:06) All registered operators including government, quasi-government and statutory corporations who enter into any contracts which result in an obligation to pay any amounts aggregating US$250 or more are required to withhold 10% of each amount payable to payees without valid tax clearance certificates. Tax clearance certificates are issued only to clients who are fully paid up and whose income tax, VAT and PAYE returns are up to date. They are valid for a period of 6 months i.e. January-June and July-December. Payer’s Obligations The amount deducted should be remitted to ZIMRA on or before the 10th of the month following the month in which the payment is made. The person from whom the amount has been withheld must be furnished with a certificate showing full details including the amount withheld. The payer should retain a copy of the tax clearance certificates furnished by registered clients. The payer is liable for the amount that he/she has failed to withhold and is also liable to payment of a 100% penalty on the amount defaulted. Interest is also payable on outstanding amounts. Exceptions Amounts paid in terms of employment contract. Payments for the supply of farm produce and livestock to farmers. However payments for farm produce to persons who buy for resale such as traders, retailers and wholesalers are subject to withholding tax. Sales effected in any shop in the ordinary course of the business of the shop and any other consumer contract for the sale or supply of goods or services or both in which the seller or supplier is dealing in the course of business and the purchaser or user is not. This caters for sales by retailers or wholesalers to consumers.
Posted on: Tue, 11 Mar 2014 18:38:27 +0000
Trending Topics
Recently Viewed Topics
© 2015