Keeping Your Business in the Light: A Layman’s Guide to ZIMRA Tax Compliance
In the world of business, your focus is usually on growth, sales, and customer satisfaction. However, behind the scenes, there is a silent partner that requires regular attention: the Zimbabwe Revenue Authority (ZIMRA).
For many business owners, the word “tax” brings a headache. But at Lucent Consultancy, we believe that tax compliance shouldn’t be a burden—it should be a badge of honor that proves your business is professional, transparent, and “investor-ready.” Understanding your obligations is the first step. Here is a simple breakdown of the four main returns every business needs to manage to stay on the right side of the law.
1. PAYE (Pay As You Earn)
Think of PAYE as a “withholding” system. As an employer, you don’t just pay your workers; you act as an agent for the government. You calculate the tax due from your employees’ salaries based on ZIMRA’s sliding scale, deduct it, and send it to ZIMRA.
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The Layman’s View: You are essentially the middleman. If you fail to deduct or remit this, ZIMRA doesn’t just look at the employee—they hold you (the business) liable for the money.
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Due Date: Usually the 5th of every month.
2. VAT (Value Added Tax)
VAT is a tax on consumption. If your business is registered for VAT, you add a standard rate (currently 15% to be 15.5% w.e.f 1 January 2026) to your invoices. This isn’t your money; you are collecting it on behalf of the state.
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The Layman’s View: You collect “Output Tax” from customers and pay “Input Tax” to your suppliers. You then pay the difference to ZIMRA. If you don’t keep your “Fiscal Invoices” in order, you won’t be able to claim back the tax you paid to suppliers, which eats into your profits.
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Due Date: Usually the 10th of the month following the end of your tax period.
3. QPDs (Quarterly Payment Dates)
Unlike individuals who pay tax as they earn, companies pay their annual Income Tax in four installments throughout the year. These are called Quarterly Payment Dates.
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The Layman’s View: It’s like a “pay-as-you-go” plan for your company’s profit tax. Instead of waiting for a massive bill at the end of the year, you pay 10%, 25%, 30%, and 35% of your estimated tax across four specific dates.
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Due Dates: March 25, June 25, September 25, and December 20.
4. Income Tax (Annual Return)
At the end of the year, you must “close the books.” Your annual Income Tax return reconciles everything you’ve paid during the year via QPDs against your actual final profit.
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The Layman’s View: This is the final exam. It summarizes your total income and expenses for the year to see if you owe more or are due for a refund.
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Due Date: Usually April 30 for the previous year’s accounts.
The High Cost of “Wait and See”
In Zimbabwe, the cost of non-compliance is significantly higher than the cost of hiring a professional. ZIMRA has moved to a high-tech system called TaRMS, which automatically flags late filers.
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Late Filing Penalties: For every day a return is late, ZIMRA can charge a fixed civil penalty. Over weeks or months, these penalties can exceed the original tax amount.
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Interest: Late payments attract daily interest, often at rates that make bank loans look cheap.
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Tax Evasion: This is a criminal offense. Intentionally hiding income or submitting false invoices can lead to garnishee orders (where ZIMRA takes money directly from your bank account), heavy fines, and even imprisonment.
How Lucent Consultancy Helps
You shouldn’t have to be a tax expert to run a successful business. Our team at Lucent Consultancy takes the weight off your shoulders by:
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Calculating and submitting your PAYE, VAT, QPDs, and Income Tax returns accurately and on time.
- Tax healthy checks
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Ensuring compliance.
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Representing you in the event of a ZIMRA query or audit.
Don’t wait for a ZIMRA letter to arrive. Would you like us to perform a “Tax Health Check” on your records to ensure you are fully compliant before the next deadline?
