Presumptive Tax legislation was introduced to broaden the revenue base in view of the increase in informal business activities. Selected sectors of the economy were targeted to ensure the participation of informal businesses in tax payment in line with experiences of other developing countries.
Details relating to the current rates and due dates of the various categories are shown below.
1. Transport Operators’ Presumptive Tax
With effect from 1 January 2015 Zinara was appointed as an agent of Zimra for the collection of presumptive taxes in respect of transport operators, taxicabs and driving schools.
Transport operators are supposed to have paid the full presumptive tax by the 20th day after the end of each quarter, however it can be paid on a monthly basis.
2. Hairdressing Salon Operators’ Presumptive Tax
Every operator of a hairdressing salon is required to pay Presumptive Tax amounting to ZWL100.00 per chair per month.
The full amount should have to be paid by the 20th day after the end of the quarter. Amounts not paid by the due date are subject to interest charges.
3. Informal Traders’ Presumptive Tax
All persons in receipt of rental income from an informal trader in respect of residential accommodation, premises or a place on which trade is carried on are required to recover an additional amount by way of Presumptive Tax equal to 10% of the rental and remit it to ZIMRA. This also includes local authorities.
The amount should be remitted within 30 days from the date the amount is recovered. Failure to recover or remit the Presumptive Tax renders the lessor personally liable for the payment of the Presumptive Tax and a penalty of 100% of the amount due. Failure or refusal on the part of the informal trader to pay the Presumptive Tax constitutes a breach of the lease and allows the lessor to terminate the lease without notice.
4. Small-Scale Miners’ Presumptive Tax
With effect from 1st October 2014 Small Scale Miners Presumptive tax was reduced from 2% of the gross amount payable to 0%, therefore no Presumptive tax will be collected from Small Scale Miners.
5. Cross-Border Traders’ Presumptive Tax
Cross border traders who import commercial goods into Zimbabwe are required to pay a Presumptive Tax equal to 10% of the value for duty purposes (VDP) of the commercial goods. The only exception is cases where the trader is registered with ZIMRA for Income Tax purposes and is up to date with submission of tax returns and payment of all taxes due.
6. Operators of Restaurants or bottle-stores
Every operator of a restaurant or bottle store is required to pay Presumptive Tax amounting to ZWL700 per month.
The full amount should have to be paid by the 10th day after the end of the quarter. Interest is chargeable on all amounts not paid by the due date.
7. Cottage Industry Operators
Every person who owns, is in charge of a cottage industry regardless of it being licensed, or not is required to pay Presumptive Tax amounting to ZWL700 per month. Cottage industry operators include those in the furniture making or upholstery trade, metal fabrication and any other cottage industry that the Minister may, by notice in a statutory instrument, prescribe.
The full amount should have to be paid by the 10th day after the end of the quarter. Interest is chargeable where the amounts due are not paid by the due date.
8. Commercial Waterborne vessels
Presumptive Tax is charged to operators of commercial waterborne vessels used for the carriage of passengers for profit and fishing rigs. The full amount of presumptive tax shall be remitted by the 10th day after the end of each quarter, however operators can still remit on monthly basis. The rates are shown in the table above.