Only operators properly registered for Value Added Tax (VAT) purposes may charge VAT on the supply of goods and services.

Compulsory registration

A trader is liable to register for VAT if the value of taxable supplies exceeds or is expected to exceed $1,000,000.00 within a period of 12 months. In cases where the operator has reached/exceeded a turnover of $1,000,000.00 but failed to register, the Commissioner General of the Zimbabwe Revenue Authority (ZIMRA) may compulsorily register the operator. The operator would be required to pay the VAT due, interest and penalties on the computed debt. Failure to register for VAT constitutes an offence in terms of the VAT Act (Chapter 23:12).

With effect from 1 January 2020 the following registration amounts and conditions apply to the various categories of VAT:

 

Registration Threshold

Compulsory Registration

 $1,000,000.00

Voluntary Registration

Subject to minimum turnover set by the Commissioner, conditions in the VAT Act

Category C

 $ 4,000,000.00

Category D

 $ 2,000,000.00

Prescribed  amount when supplier not required  to provide a tax invoice

$100.00

Prescribed amount where no refund is processed

$600.00

Civil penalty for failure to register

$300.00

Who may be excluded from registration?

The following will not be obliged to register for VAT:

  • traders who will be solely dealing in exempt supplies;
  • any person conducting private or recreational pursuit or hobby;
  • any service provided by an employee to his employer or small traders whose taxable turnover is below $1,000,000.00 per annum

 

How to register for VAT

The following information should be submitted online using ZIMRA eservices portal;

Form REV 1 which is fully completed form (can be downloaded from the ZIMRA website (www.zimra.co.zw)

In the case of a company:

  • Certified copy of Certificate of Incorporation
  • Certified copy of Memorandum and Articles of Association (1st three pages plus the last page)
  • Stamped Current Bank Account
  • CR 6 and CR 14
  • Certified copies  of identity documents for at least two directors
  • Letter appointing  Public Officer and confirmation that the person has got signing powers to the bank accounts
  • Proof of residence of directors and public officer in the form of utility bills or supported with an affidavit if the proof is not in the director’s name.

For Individuals:

  • · Stamped current bank statement;
  • · Certified Copy of ID;
  • · Copy of proof of residence in the form of utility bills, supported with affidavit if not in the trader’s name.

Upon registration, every registered operator will be issued with a certificate of registration and such certificate shall be displayed prominently. This will allow for easy identification of traders registered for VAT.

Please Note the REV 1 form can be downloaded from the ZIMRA website (www.zimra.co.zw)

 

What are the responsibilities of a registered person?

A registered person is obliged to comply with the following requirements of the VAT Act:

  • keep accounting records for at least six years after the tax period to which they relate
  • complete and submit VAT  returns as per requirement
  • calculate and remit the VAT due to the Commissioner General of ZIMRA on or before the due date
  • issue tax/fiscal  invoices, debit notes or credit notes
  • account for VAT if one sells or retains stock or assets.
  • advise the Commissioner General of any changes in business details or when one ceases trade.

 

Cancellation of registration

Deregistration can be done at the Commissioner’s discretion, on voluntary application, or on cessation of trade and notice being given within 21 days of the date of such cessation of trade. In this case, a VAT 5 form should be completed and submitted to the Commissioner General of ZIMRA. If he/she is satisfied that all obligations have been met in full, he/she shall accordingly deregister the operator.