Zambia tax rates 2026

PAYE bands are unchanged from 2025. Pension contributions are not deducted before the tax is worked out.

A person in Zambia for a temporary purpose becomes resident once they have spent 183 days in the country during the charge year, counting one stay or several added together. Someone who moves with the intention of settling falls outside that exception and is resident for the year of arrival. Husband and wife are assessed separately, each on their own income and their own days in the country.

Tax falls on income from a Zambian source, and the source rules reach far. Most pensions count as Zambian income wherever the paying fund sits, unless the job behind the pension was wholly abroad and its pay was never taxed in Zambia. Interest, royalties and management fees paid out of Zambian funds are Zambian income too, and a business run partly abroad by someone ordinarily resident in Zambia is treated as wholly Zambian.

The charge year matches the calendar year. Employees pay through PAYE: the employer deducts tax every month and remits it to the Zambia Revenue Authority by the 10th of the following month, and for most salaried people that deduction settles the year. An employee who leaves a job with too much tax deducted claims the refund on form ITF/1A within six years.

Anyone with business, rental or other income outside PAYE files a provisional return by 31 March and pays the estimated tax in four instalments by 10 April, 10 July, 10 October and 10 January. The final income tax return and any balance are due by 21 June after the year ends, and tax raised on an assessment is payable within 30 days.

Non-residents pay Zambian tax only on income from a Zambian source, and most of it is collected by withholding at the point of payment. Dividends, royalties and management or consultancy fees paid to a non-resident carry 20% withholding tax, and that deduction is the final tax. Payments to non-resident contractors also carry 20%. Where Zambia has a double taxation agreement with the recipient's country, the treaty rate applies instead.

Pay for work done in Zambia is Zambian income even when an overseas employer pays it into a foreign account, so a foreign payroll does not take a salary outside the charge. This holds for residents and non-residents alike, and for a short assignment as much as a long one, since the rule turns on where the work is done.

Residents receive dividends net of 15% withholding tax, which is the final tax on them, and dividends paid by mining companies carry no withholding at all. Interest an individual earns on bank and building-society savings or deposit accounts carries no withholding tax, and savings groups such as cooperatives and village banking pay interest out at 0%. Companies receive interest net of 20%, which counts as an advance against their final tax.

Zambia has no capital gains tax. Its place is taken by Property Transfer Tax, paid by the seller at 8% of the value of land, shares or intellectual property transferred, and at 10% on mining rights and mineral processing licences. The tax is due within 14 days of completing the transfer. A sale of shares in a foreign company that holds an interest in a Zambian company is also caught, and the Zambian company files the return.

Small businesses with annual turnover up to K5,000,000 pay turnover tax on gross sales instead of income tax: 0% on the first K30,000 a year and 5% above it. The return and payment are due monthly by the 14th. Businesses above the ceiling move to income tax, management and consultancy services cannot use turnover tax at any size, and income tax losses carry forward for five years.

Rental income is taxed on the gross rent received, with no deduction for expenses. The first K30,000 a year is tax-free, rent above that up to K800,000 is taxed at 4%, and rent above K800,000 at 16%. Business and rental records must be kept for six years.

From 1 January 2026 the tax-free band for turnover tax and rental income tax widened to K30,000 a year from K12,000, which takes many small traders and landlords out of tax entirely. The penalty for paying turnover tax late fell to 0.5% from 5%, while late PAYE still draws a 5% penalty plus interest at the policy rate plus 2%.

Property Transfer Tax was tightened at the same time. A share transfer inside a corporate group now qualifies for nil value only when both companies have belonged to the group for at least three years, and shares surrendered or forfeited for no payment are exempt. PAYE bands were left unchanged, so pay rises in 2026 meet the same 37% threshold as in 2025.