In Zimbabwe, the concept of “remuneration” for tax purposes is broad. Under the Income Tax Act [Chapter 23:06], it includes not just your basic salary, but almost any advantage or benefit granted to you by your employer.
While these perks—known as Fringe Benefits—can significantly enhance your lifestyle, they are generally taxable. As of 2026, with the dual-currency system (USD and ZiG) firmly in place, understanding how these benefits are valued is essential for every taxpayer.
1. Common Taxable Fringe Benefits
Most benefits are valued based on the cost to the employer. If your employer pays for a service on your behalf, that cost is added to your gross income and taxed at your marginal PAYE rate.
Housing and Furniture
Unlike most benefits, housing is valued based on the value to the employee.
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Company-owned House: The benefit is usually determined by the market rental value of the property in that specific location.
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Rented Accommodation: If the employer pays your rent, the full amount of the rent is a taxable benefit.
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Furniture: If your employer provides furniture, a percentage of the cost of that furniture is added to your taxable income.
School Fees
If your employer pays school fees for your children, the full cost is generally taxable.
The “Teacher’s Concession”: If you are a member of the teaching or non-teaching staff at a school, only 50% of the school fees for up to three of your children are considered taxable income.
Low-Interest Loans
If your employer grants you a loan at an interest rate lower than the market rate, the “interest savings” you enjoy is a taxable benefit.
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USD Loans: A benefit arises if the interest rate is less than LIBOR + 5%.
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ZiG Loans: A benefit arises if the interest rate is significantly below the prevailing market rates (often pegged to the central bank’s policy rate).
2. The Motoring Benefit
The “company car” is one of the most common perks in Zimbabwe. Instead of calculating every liter of fuel or service cost, ZIMRA uses a Deemed Cost system based on the engine capacity of the vehicle.
| Engine Capacity (cc) | Annual Benefit (Deemed Cost) |
| Up to 1500cc | $625 |
| 1501cc to 2000cc | $830 |
| 2001cc to 3000cc | $1250 |
| Above 3000cc | $1660 |
Note: These values are periodically updated in the Finance Act. If you use the car for both business and private travel, the entire deemed amount is typically applied unless specific logs prove otherwise.
3. Exempt or Non-Taxable Benefits
Not every “perk” attracts a tax bill. Certain benefits are specifically exempted to encourage employee welfare:
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Medical Treatment: The value of medical treatment or medical aid contributions paid by the employer for you, your spouse, or your children is generally exempt.
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Canteen Meals: Meals provided in a staff canteen for employees in general are usually not taxed.
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Protective Clothing: Uniforms or safety gear required for your job are non-taxable.
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Elderly Concessions (Age 55+): If you are 55 or older, you may be exempt from tax on the benefit arising from the disposal of a company motor vehicle to you at a discount.
4. Dual Currency Implications
Since Zimbabwe operates a multi-currency system, the tax on your benefits must follow the “currency of payment” rule:
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If your benefit is paid for in USD, it is taxed using the USD tax tables.
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If it is paid for in ZiG, it is taxed using the ZiG tax tables.
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For non-cash benefits (like the use of a car), the value is usually converted to the currency of your main contract for tax calculation.
Summary Table: Tax Treatment at a Glance
| Benefit Type | Tax Status | Valuation Basis |
| Cash Allowances (Fuel, Travel) | Fully Taxable | Actual amount paid |
| Medical Aid | Exempt | N/A |
| Company Car | Taxable | Deemed cost (Engine size) |
| Soft Loans | Taxable | Interest rate differential |
| Passage Benefit (Holiday travel) | Taxable | Cost to employer |
