Taxation in Tanzania
Encyclopedia
In Tanzania
the Income Tax Act, 2004 came into effect in July 2004. This act restructured the income tax
system in line with modern requirements and repealed the previous Income Tax Act, 1973. Tax
is levied on income
from employment
, income from business
and income from investment
. Taxable persons include entities and individuals. An entity can be a corporation
or a trust, and a corporation is loosely defined to mean any incorporated or unincorporated body of persons or association. For partnership
s the individuals within the partnership are taxed on their share of the income. Taxation is on worldwide income for residents (or for individuals, of residents of more than two years) while taxation of non-residents is on Tanzanian source income only. The corporate tax rate is 30%. The individual tax threshold is Tsh 1,200,000 per annum, and the rates are from 15% to a top rate of 30%. Various provisional and final withholding taxes are applied to ease the collection of tax.
Both the Income Tax Act, 2004 itself and a comprehensive interactive guide to income tax for Tanzanian residents is provided on the website of the Ministry of Finance and Economic Affairs of Tanzania (see guide).
In Tanzania the Income Tax Act, 2004 came into effect in July 2004. This act restructured the income tax system in line with modern requirements and repealed the previous Income Tax Act, 1973. Tax is levied on income from employment, income from business and income from investment. Taxable persons include entities and individuals. An entity can be a corporation or a trust, and a corporation is loosely defined to mean any incorporated or unincorporated body of persons or association. For partnerships the individuals within the partnership are taxed on their share of the income. Taxation is on worldwide income for residents (or for individuals, of residents of more than two years) while taxation of non-residents is on Tanzanian source income only. The corporate tax rate is 30%. The individual tax threshold is Tsh 1,620,000 per annum, and the rates are from 14% to a top rate of 30%. Various provisional and final withholding taxes are applied to ease the collection of tax.
Both the Income Tax Act, 2004 itself and a comprehensive interactive guide to income tax for Tanzanian residents is provided on the website of the Ministry of Finance and Economic Affairs of Tanzania.
Tanzania
The United Republic of Tanzania is a country in East Africa bordered by Kenya and Uganda to the north, Rwanda, Burundi, and the Democratic Republic of the Congo to the west, and Zambia, Malawi, and Mozambique to the south. The country's eastern borders lie on the Indian Ocean.Tanzania is a state...
the Income Tax Act, 2004 came into effect in July 2004. This act restructured the income tax
Income tax
An income tax is a tax levied on the income of individuals or businesses . Various income tax systems exist, with varying degrees of tax incidence. Income taxation can be progressive, proportional, or regressive. When the tax is levied on the income of companies, it is often called a corporate...
system in line with modern requirements and repealed the previous Income Tax Act, 1973. Tax
Tax
To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many subnational entities...
is levied on income
Income
Income is the consumption and savings opportunity gained by an entity within a specified time frame, which is generally expressed in monetary terms. However, for households and individuals, "income is the sum of all the wages, salaries, profits, interests payments, rents and other forms of earnings...
from employment
Employment
Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as:- Employee :...
, income from business
Business
A business is an organization engaged in the trade of goods, services, or both to consumers. Businesses are predominant in capitalist economies, where most of them are privately owned and administered to earn profit to increase the wealth of their owners. Businesses may also be not-for-profit...
and income from investment
Investment
Investment has different meanings in finance and economics. Finance investment is putting money into something with the expectation of gain, that upon thorough analysis, has a high degree of security for the principal amount, as well as security of return, within an expected period of time...
. Taxable persons include entities and individuals. An entity can be a corporation
Corporation
A corporation is created under the laws of a state as a separate legal entity that has privileges and liabilities that are distinct from those of its members. There are many different forms of corporations, most of which are used to conduct business. Early corporations were established by charter...
or a trust, and a corporation is loosely defined to mean any incorporated or unincorporated body of persons or association. For partnership
Partnership
A partnership is an arrangement where parties agree to cooperate to advance their mutual interests.Since humans are social beings, partnerships between individuals, businesses, interest-based organizations, schools, governments, and varied combinations thereof, have always been and remain commonplace...
s the individuals within the partnership are taxed on their share of the income. Taxation is on worldwide income for residents (or for individuals, of residents of more than two years) while taxation of non-residents is on Tanzanian source income only. The corporate tax rate is 30%. The individual tax threshold is Tsh 1,200,000 per annum, and the rates are from 15% to a top rate of 30%. Various provisional and final withholding taxes are applied to ease the collection of tax.
Both the Income Tax Act, 2004 itself and a comprehensive interactive guide to income tax for Tanzanian residents is provided on the website of the Ministry of Finance and Economic Affairs of Tanzania (see guide).
In Tanzania the Income Tax Act, 2004 came into effect in July 2004. This act restructured the income tax system in line with modern requirements and repealed the previous Income Tax Act, 1973. Tax is levied on income from employment, income from business and income from investment. Taxable persons include entities and individuals. An entity can be a corporation or a trust, and a corporation is loosely defined to mean any incorporated or unincorporated body of persons or association. For partnerships the individuals within the partnership are taxed on their share of the income. Taxation is on worldwide income for residents (or for individuals, of residents of more than two years) while taxation of non-residents is on Tanzanian source income only. The corporate tax rate is 30%. The individual tax threshold is Tsh 1,620,000 per annum, and the rates are from 14% to a top rate of 30%. Various provisional and final withholding taxes are applied to ease the collection of tax.
Both the Income Tax Act, 2004 itself and a comprehensive interactive guide to income tax for Tanzanian residents is provided on the website of the Ministry of Finance and Economic Affairs of Tanzania.