Tax Credits

Taxpayers who receive income from employment are entitled to a number of credits.

A tax credit is limited to the Pay As You Earn (PAYE) which an employee is liable to pay. Tax credits should not give rise to negative PAYE but should instead be carried forward to the next pay periods until it is fully utilised. At the end of the year of assessment all unutilised credits fall away as they cannot be carried forward to the next year of assessment.

Types of Credits

  1. Elderly person’s credit – a credit of USD900, 00 shall be deducted from the income tax of a taxpayer who has attained the age of 55 years. The taxpayer should have turned 55 years before the commencement of the year of assessment.
  2. Blind person’s credit- a credit of USD900, 00 shall be deducted from the income tax of a taxpayer who is blind. An unused credit for a blind person who is married can be transferred to his or her spouse.
  3. Invalid appliances and medical expenses- this credit is granted at the rate of 1 dollar for every 2 dollars paid.

Invalid appliancesand “fittings are defined as

i)                   A wheelchair or a mechanically propelled vehicle which is specially designed and constructed to carry one person who has a physical defect or disability.

ii)                 Artificial limbs ,leg calipers or crutches

iii)               Any special fittings 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.

iv)               Spectacles or contact lenses.

Medical expenses” means sum of any payments made by a taxpayer, his        wife or

minor child for

i)                   The purchase, hire, maintanance, repair or modification of an invalid appliance or fitting which the Commissioner is satisfied is for use by a taxpayer, his wife or minor child who has a physical defect or disability.

ii)                 Services received from a medical or dental practitioner.

iii)               Purchase of drugs or medicine on a prescription from a medical or dental practitioner.

iv)               Hospitalisation, blood transfusions, X-rays, and laboratory test.

v)                  Conveyance by ambulances.

vi)               Medical aid contributions made by the taxpayer for himself, spouse and minor children.

Medical credit shall not be granted to non-residents except for contributions to medical aid societies.

 

Payments made from the deceased estate of taxpayer after the death of the taxpayer shall be treated as having been made before his or her death.

 

No credit shall be granted if a taxpayer receives or is entitled to a refund from the medical aid society.

 

(For a detailed list of medical expenses where a credit shall not be granted please visit our ZIMRA offices).

  1. Mentally or physically disabled  person’s credit-

i)                   A credit of USD900,00 shall be granted to a taxpayer where it is proved to the satisfaction of the commissioner that the taxpayer is mentally or physically disabled to a substantial degree

ii)                 The taxpayer should not be blind.

iii)               A credit of USD900,00 shall be deducted in respect of each child of a taxpayer who is not a married woman where it is proved to the satisfaction of the Commissioner that the child is mentally or physically disabled to a substantial degree

iv)               The unused credit is transferable between spouses.

v)                  The credit is not granted to non-residents.

vi)               Credit shall not be granted if disability is of a temporary or transitional nature.

 
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