As part of Zimbabwe Revenue Authority (ZIMRA) Business Processes Re-engineering, ZIMRA will be introducing  the Tax and Revenue Management System (TaRMS) which will go live on 12 October 2023.   This is  part of the organisation’s focus on simplifying business processes for the convenience of Taxpayers. ZIMRA is key in the national transformation and economic viability of Zimbabwe towards its vision 2030.Hence the need for ZIMRA to change its processes to facilitate ease of doing business.

TaRMS will be the new system for automating Domestic Taxes processes, replacing the current system(SAP TRM). ZIMRA has been facing a series of system challenges in the provision of its services to its Taxpayers through SAP TRM under Domestic Taxes Division.

The following will be some of the benefits of TaRMS:

Taxpayer Registration

• Elimination of duplicate Business Partner Numbers and Tax Types registrations.
• On-line validation of Company Registration Numbers(CRN), ID numbers and bank account numbers as TaRMS is integrated with Registrar of Companies, Civil Registry, and Banks.
• The system can register Public Officer/Representative, Directors and Shareholders.
• Taxpayer Identification Number (TIN) and Tax Types registration will be automatic for all entities except few cases that require ZIMRA approval.
• Reduction of manual registration forms
• Taxpayer can, through Self Service Portal (SSP), save partially completed taxpayer registration application forms or tax return in draft for continuation later on.
• Taxpayer can update master data through SSP without requirement for human intervention.

Tax Return Management

• One TIN for both USD and ZWL: In TaRMS, a taxpayer submits one return per tax period and posts liabilities in ZWL and USD. (Convenient for the taxpayer).
• All returns/claim forms are fully automated except the following which are partially automated:
  • Capital Gains Tax
  • VAT for Development Partners and VAT for Entities/Individuals with Diplomatic Immunity.

Payments Management

• The system will eliminate the issue of unallocated payments in ZIMRA Bank accounts and avoid creation of Suspense Account.
• TaRMS will eliminate overpayments and duplicate payments by Taxpayers, since payment is based on the Return submitted.
• Elimination of tax payments mis-postings (time spent in correcting mis-posted payments will now be eliminated).
• A single payment can be made to settle several tax obligations, making it cheaper and convenient for the taxpayer.
• Elimination of exchange rate variations because:
  • Tax liabilities will be only in ZWL and USD.
  • Payments will also in ZWL and USD.
  • TaRMS will have automatic account maintenance for the Taxpayer’s ledger.

Refunds Management

• TaRMS will automatically identify Refunds for processing.
• Automatic determination of any outstanding liabilities (Returns and Payments).

Debt Management

• Automatic detection of unpaid liabilities.
• Automatic aging of liabilities according to set parameters.
• Automatic account maintenance since a tax liability shown in the return is settled directly from the single account.
• System automatically calculates interest on a daily basis, update and show the total in the taxpayer ledger.
• System automatically calculates penalties from the due date and posts to the taxpayer ledger.
• TaRMS will be able to automatically reverse interest charges and penalty on all adjusted/amended tax types liabilities.
• System will be able to automatically issue reminders for payments and returns prior to due-date, on due-date, and after due date according to the escalation procedures. (Reminders will not be sent to, taxpayers who are up to date with their payments and returns).
• Taxpayer can apply for instalment plans online.
• Based on set criteria, TaRMS can automatically approve some installment plan applications.
• Automatic cancellation of installment plans upon failure to honour a payment plan.

What is a mentally or physically disabled person’s tax credit?

It is a specified amount deducted from the income tax, which a taxpayer is chargeable, where it is proved to the satisfaction of the Commissioner that the taxpayer is mentally or physically disabled to a substantial degree, but is not blind. The tax credit has an effect of reducing the tax liability of a taxpayer.

Who qualifies for the credit?

A qualifying individual taxpayer or taxpayer’s child who is proved to the satisfaction of the Commissioner to be mentally or physically disabled to a substantial degree. A taxpayer can also claim the credit for his /her child who is blind.

What are the conditions to be fulfilled?

• The taxpayer should be ordinarily resident in Zimbabwe at any time in the period of assessment.
• The employee should get a letter from a specialist medical doctor, stating the nature and degree of disability and apply for a written directive from their nearest ZIMRA office.
• A person shall be regarded as being mentally or physically disabled if his disability is not of a temporary or transitional nature.

Can the tax credit be apportioned?

• No, the tax credit cannot be apportioned.

Is the tax credit transferable between spouses?

• Yes, the tax credit can be transferred between spouses.
• Any portion of a credit deductible in terms of subsection (1) or (2) which is not applied in reduction of the income tax with which a married person is chargeable shall be allowed as a deduction from the income tax with which his or her spouse is chargeable.

How much is the credit?

• The specified amount of credit to be deducted from the income tax payable by a qualifying taxpayer is $ USD 900 or 450 000ZWL per each year of assessment.

The WCO SAFE Framework of Standards recommends that as part of modernization of customs processes at ports of entry, Scanners or Non-Intrusive Inspection Technology (NIIT) should be available and used for conducting inspections. Scanners are non-intrusive inspection tools or techniques which includes commercial X-ray cargo scanners and baggage X-ray scanners.

ZIMRA initiated the use of scanners as far back as 2005, when the Authority acquired relocatable cargo x-ray scanners for use at its major border post Beitbridge. The Authority later on procured vehicle inspection mobile scanners, palletised scanners and baggage scanners, and has recently introduced X-Ray Fast scanners at Beitbridge, Forbes and Chirundu, these X-ray scanners can be operated in drive through mode and active mode.

These scanners have the ability to detect contraband and inconsistence cargo through the use of X-ray technology.  Simplified X-ray technology results in imaging of cargo or baggage in containers or bags.  Once they have detected an inconsistency in the cargo, a physical examination can be conducted in the area that the inconsistency was noted.

This scanner technology allows ZIMRA to target high risk cargo for examination whilst low risk is quickly released that allowing for the targeted allocation of resources. Baggage Scanners are also in use are at our 3 main international airports and all major ports of entry, for the convenience of travelling public.

The scanned cargo or baggage if found to be consistence with the declaration of importer or exporter is released from customs immediately. Cargo with suspicious or inconsistence images is referred for a physical examination which usually result in collection of customs duty, detention of undeclared goods and even levying of civil fines for contravention of customs laws and procedure. Civil fines are levied on contraband found through the use of scanners.

The major benefits of scanning goods or cargo are as follows: Risk profiling is enhanced; improved revenue collection; Compliance with regulatory laws; reduction in instances of smuggling; Reduced customs clearance turnaround time; Limited physical handling of goods (COVID era) and Reduced physical interface between client and staff.

In conclusion the scanners have assured an era of Customs modernsation in order to increase efficiency and effectiveness of customs clearing process, and which has been proved to be a game changer in improving compliance to Customs Laws and procedures. 

My Taxes, My Duties: Building my Zimbabwe!!

Disclaimer

This article was compiled by the Zimbabwe Revenue Authority (ZIMRA) for information purposes only. ZIMRA shall not accept responsibility for loss or damage arising from use of material in this article and no liability will attach to the Zimbabwe Revenue Authority. 

With effect from 1 June 2023, a surcharge of thirty percent (30%) shall apply on motor vehicles of an FOB value of USD 120, 000.00 and above? It an additional tax charged over and above the normal duty and tax ordinarily charged on the specified motor vehicles listed below.

Which vehicles are affected by this surcharge?

The 30% surcharge shall apply to motor vehicles of commodity codes listed below

1. The whole of heading 8703 which includes:

• Passenger type motor vehicles commonly known as saloon cars, sedans, hatchbacks, station wagons and the like.
• Ambulances and hearses

2. All double cabs and extended cab vehicles classified as follows:

• 8704.21.20 Double Cabs
• 8704.31.20 Double Cabs
• 8704.21.50 Extended Cabs
• 8704.31.50 Extended Cabs
• 8704.41.20 Double Cabs
• 8704.41.50 Extended Cabs
• 8704.51.20 Double Cabs
• 8704.51.50 Extended Cabs

Exclusions

The following importations will not be subjected to the 30% surcharge

1. Vehicles procured by the government
2. Vehicles of a commercial nature for example buses, minibuses, trucks, road tractor units, and the like
3. Single cab vehicles and panel vans

Disclaimer

This article was compiled by the Zimbabwe Revenue Authority (ZIMRA) for information purposes only. ZIMRA shall not accept responsibility for loss or damage arising from use of material in this article and no liability will attach to the Zimbabwe Revenue Authority. 

Certain goods can be temporarily exported and not pay duty on their return due to their nature and purpose of export. There are personal items that are carried on a travellers person that qualify for such a reprieve in Customs that are for personal consumption. There are many cases where travellers indicate that they had temporarily exported their valuable personal effects but do not have proof that they did so. In this instance, they would not be carrying any documents to support their plea. This has resulted in many disputes among travellers and officers. Let us explore a summary of instances and goods that can be temporarily exported and not pay duty on their return.

Personal effects

Used clothing and toilet requisites should be in such quantities and of such values as the Commissioner may consider being reasonable. Articles like radios, binoculars, laptops and cameras should be registered at a Customs House or Port of exit before exportation. The said articles shall be brought before the officer registering them for inspection. The articles shall only be registered if they can be accurately described and are capable of being identified (have serial numbers) on their return. If the articles meet the above conditions, the officer will issue traveller with a General Registration Certificate with the full details of the article including serial numbers and his/her personal details. This certificate should then be produced on return as proof of temporary export so that no duty will be charged on that article.

Goods for Repair and Return

When goods are exported for repair and return, only the cost of repairs will be subject to duty. The tariff heading to be applied is that under which the repaired article, as re-imported would be classified. For instance, duty rates levied on the cost of repairing a television set are those applicable on an imported television set.

Where the repair was done in terms of a valid guarantee and no charge is raised for the repair, no duty will be levied on re-importation of such an article.

General Registration Certificate and Declaration Form

It is very important to declare your personal effects which you are temporarily exporting so as to avoid inconveniences on re-entry or challenges with officers at the port of exit. A General Registration Certificate is used for this purposes and in cases where such forms are scarce, a Declaration Form 47 processed by the officer at a Customs House or port of exit can also serve the same purpose. The form should clearly indicate goods temporarily exported and/or for re-importation.

Certain goods can be temporarily exported and not pay duty on their return due to their nature and purpose of export. These are personal items that are carried on a travellers person that qualify for such a reprieve in Customs that are for personal consumption. There are many cases where travellers indicate that they had temporarily exported their valuable personal effects but do not have proof that they did so. In this instance, they would not be carrying any documents to support their plea. This has resulted in many disputes among travellers and officers.

Let us explore a summary of instances and goods that can be temporarily exported and not pay duty on their return.

Personal effects

Used clothing and toilet requisites should be in such quantities and of such values as the Commissioner may consider being reasonable. Articles like radios, binoculars, laptops and cameras should be registered at a Customs House or Port of exit before exportation.  The said articles shall be brought before the officer registering them, for inspection. The articles shall only be registered if they can be accurately described and are capable of being identified (have serial numbers) on their return. If the articles meet the above conditions, the officer will issue traveller with a General Registration Certificate with the full details of the article including serial numbers and his/her personal details. This certificate should then be produced on return as proof of temporary export so that no duty will be charged on that article.

Goods for Repair and Return

When goods are exported for repair and return, only the cost of repairs will be subject to duty. The tariff heading to be applied is that under which the repaired article, as re-imported would be classified. For instance, duty rates levied on the cost of repairing a television set are those applicable on an imported television set.

Where the repair was done in terms of a valid guarantee and no charge is raised for the repair, no duty will be levied on re-importation of such an article,

General Registration Certificate and Declaration Form

It is very important to declare your personal effects which you are temporarily exporting so as to avoid inconveniences on re-entry or challenges with officers at the port of exit. A General Registration Certificate is used for this purposes and in cases where such forms are scarce, a Declaration Form 47 processed by the officer at a Customs House or port of exit can also serve the same purpose. The form should clearly indicate goods temporarily exported and/or for re-importation.

My Taxes, My Duties: Building my Zimbabwe!!

Disclaimer

This article was compiled by the Zimbabwe Revenue Authority (ZIMRA) for information purposes only. ZIMRA shall not accept responsibility for loss or damage arising from use of material in this article and no liability will attach to the Zimbabwe Revenue Authority. 

To contact ZIMRA:

 www. zimra.co.zw@Zimra_11

 ZIMRA.ZW

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 Contact Centre 585/ 08688007614

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0242 –758891/5; 790813; 790814; 781345; 751624; 752731

+263 0782729862

e-TIP  http://ecustoms.zimra.co.zw/etip

In terms of section 16 of the Capital Gains Tax Act [ CHAPTER 23:01], Capital Gains Tax (CGT) is deferred where any specified asset is transferred between spouses or a principal private residence is transferred to a former spouse in compliance to a court directive. The transferor and the transferee may elect that the sale price be deemed equal to the deductions allowable such that in the hands of the transferor nothing will be taxable.

What are the requirements for deferring CGT upon transfer of specified assets between spouses?

An election has to be made at the time the person making the election is submitting the CGT return for the assessment of his capital gain.

What are the conditions of deferring CGT?

The concession is limited to where:

(a) the ownership of any specified asset is transferred from a person to his or her spouse; or

(b) a person transfers the ownership of a specified asset which is his principal private residence to his former spouse in compliance with an order of a court providing for the maintenance of the former spouse or dividing, apportioning or distributing the assets of the former spouses on or after the dissolution of their marriage.

In what circumstances does the deferred CGT become due?

In the event that the specified asset is subsequently sold to another party, capital gain or assessed capital loss in the hands of the seller shall be calculated as if the asset is still owned by the first transferring spouse.

My Taxes, My Duties: Building my Zimbabwe!!

Disclaimer

This article was compiled by the Zimbabwe Revenue Authority (ZIMRA) for information purposes only. ZIMRA shall not accept responsibility for loss or damage arising from use of material in this article and no liability will attach to the Zimbabwe Revenue Authority.