Zambia Income Tax Act 1967 (As Amended 2006)

CHAPTER 323
THE INCOME TAX ACT

ARRANGEMENT OF SECTIONS
PART I
PRELIMINARY AND INTERPRETATION
Section
1. Short title
2. Interpretation
3. Repealed by Act No. 7 of 1996
4. Resident
5. Receipt of income
PART II
ADMINISTRATION
6. Appointment of staff
7. Officers and delegation of functions
8. Secrecy
9. Regulations
10. Records of assessment
11. Forms and notices
12. Notices and service
PART III
CHARGE OF TAX
14. Charge of Tax
15. Exemptions from tax
15A. Suspension and rebate of Income Tax
16. Chargeability of income that cannot be remitted on accrual
17. Classification of income
18. Income deemed within the Republic
19. Income deemed received
21. Apportionment of gratuities and compensation for loss of
office
22. Apportionment of income
23. Provisions relating to income from business
24. Provisions relating to income after cessation of business
25. Insurance business
26. Income of partner
27. Special provisions relating to deceased's estate and trusts
28. Income of non-resident air, sea or land transport business
PART IV
DEDUCTIONS
29. Deductions generally
29A. Foreign currency exchange gains and losses
30. Losses
30A. Indexation of losses
31. Transfer of losses
32. Losses prior to bankruptcy, etc
33. Capital allowances
34. Investment allowances
34A. Development allowance
35. Preliminary business expenses
36. Amount paid after cessation of business
37. Approved fund deductions
37A Deduction for share option
38. Technical education
39. Subscriptions
41. Charities
43. Deduction for research
43A. Deduction for bad and doubtful debts
43B. Repealed by Act No. 17 of 1988
43C. Repealed by Act No.3 of 2002
43D. Deduction for employing a handicapped person
43E. Repealed by Act No. 7 of 1996
44. Case of no deduction
PART V
RETURNS AND ASSESSMENTS
Section
45. Notice to Commissioner-General
45A. Duty to provide taxpayer identification number
45B. Taxpayer identification number required for certain
transactions
46. Returns generally
46A. Provisional Income
46B. Estimated provisional tax returns
47. Further provisions as to returns
48. Information generally
49. Statement of bank accounts, assets, etc.
50. Return of lodgers and inmates
51. Information as to business matters
53. Public documents
54. Information as to companies
55. Accounts and records
56. Documents in support of returns
57. Examination by Commissioner-General
58. Production and preservation of books and documents
60. Amount of dividends, interest or royalties to be included in
income
61. Partnership returns
62. Business accounts
62A. Averaging of farming and fishing income
63. Commissioner-General's power to assess
64. Estimated assessments
64A Standard Assessment
65. Assessment rules
66. Taxpaying agents
67. Assessment of taxpaying agent
68. Right of taxpaying agent
69. Company's taxpaying agent
70. Errors in form
PART VI
PAY AS YOU EARN
Section
71. Assessment, charge, collection and recovery
72. Assessment not always necessary
73. Priority on insolvency
PART VII
DOUBLE TAXATION RELIEF
74. Double taxation agreements
75. Double taxation relief
76. Unilateral double taxation relief
PART VIII
COLLECTION, RECOVERY, REFUND AND RELIEFS
77. When tax due and payable
78. Penalty for non-payment of tax
78A. Interest on overdue payments
79. Recovery and proceedings
79A. Recovery by distress
79B. Recovery through court
79C. Charge on land
79D. Recovery of partner's tax from partnership
80. Deduction of tax from interest and royalties
81. Deduction of tax from dividends
81A. Repealed by Act No. 7 of 1996
81AA Definition of permament establishment.
81B. Tax clearance certificate
81C. Deduction of tax for use of patent, design, trade mark etc
82. Deduction on tax from lump sum payments
82A. Deduction of tax from certain payments
82B. Definition of property
83. Property not in possession
84. Agent for payment of tax
86. Liability where property alienated
87. Refunds in general
88. Refunds in cases of accumulated income
89. Refund or set-off of tax chargeable on a beneficiary
90. Refund or set-off of tax deducted from dividends, etc
90A. Job credits
90B. Repealed by Act No. 9 of 1977
91. Error or mistake relief
92. Remission of Tax
92A. Reduction in Tax for Tax free Zones
93. Tax less than three thousand kwacha not payable
PART IX
AVOIDANCE
94. No set-off or refund where that is the object of change of
ownership of shares in company
95. Transactions designed to avoid tax liability
95B. Inter-company shareholdings
95C. Repealed by Act No. 7 of 1996
95D. Loans to effective shareholders
96. Incurred loss not deductible in certain cases
97. Commissioner-General may avoid trust
97A. Transfer pricing
97AA Special provisions where actual conditions include issuing
security
97B Non application of section 97A
97C Provitions supplementary to 97A
97D Objections and appeals involving transfer pricing
PART X
OFFENCES AND PENALTIES
98. General penalty
99. Penalty for failure to comply with notice, etc.
100. Penalty for incorrect returns, etc.
101. Time limit
102. Penalty for fraudulent returns, etc.
103. Bodies corporate
104. Power to search and seize
105. Documents in evidence
PART XI
OBJECTIONS AND APPEALS
Section
106. Assessments good until disproved
107. Establishment of Tax Appeal Court, its composition and
powers
108. Objection to assessment
109. Appeal against assessment
110. Determination of appeals
111. Appeal to High Court and Supreme Court
112. Privacy of proceedings
113. Adjustment on successful objection or appeal
114. Appeals from Commissioner-General's discretion and
determinations
115. Repealed by Act No.9 of 1998
PART XII
REPEALS AND TRANSITIONAL PROVISIONS
116. Repeals
ARRANGEMENT OF SCHEDULES
FIRST SCHEDULE-Further Classification of Income
Paragraph
1. Maintenance
2. Improvements
3. Commencement and cessation of employment
4. Lump sum payments
5. Capital recoveries
6. Exotic timber
7. Farm stock
8. Shares or options
SECOND SCHEDULE-Exemptions
PART I
1.-2. EXEMPT OFFICE HOLDERS
PART II
3.-4. FOREIGN EXEMPTIONS
PART III
EXEMPT ORGANISATIONS
5. Various organisations
6. Charities
PART IV
EXEMPT INCOME
7. Various exemptions
8. Passages
9. Interest
10. Annuities
11.
THIRD SCHEDULE-Insurance Business
1. Insurance other than life
2. Life insurance
3. Insurance and other business
4. Mutual and proprietary companies
FOURTH SCHEDULE-Approved Funds
Paragraph
1. Definition of "trustees"
2. Approval of pension funds
3. Procedural provisions relating to approval of fund and
withdrawal of approval
4. Approval of annuity contracts and withdrawal of approval
5. Approval of foreign fund or scheme established by law
6. Appeals
7. Remoteness
FIFTH SCHEDULE-Capital Allowances for Buildings, Implements,
Machinery and Plant, and Premiums
PART I
BUILDINGS
1. Definition of industrial building
2. Definition of commercial building
3. Initial allowance for industrial buildings
4. Wear and tear allowance for buildings
5. Balancing allowance for buildings
6. Divided use
PART II
IMPLEMENTS, MACHINERY AND PLANT
7. Business to include employment in this Part
8. Frequently replaceable articles not within this Part
10. Wear and tear allowance for implements, machinery and plant
11. Capital recoveries for implements, machinery and plant
12. Divided use
13. Valuation in exceptional circumstances
PART III
PREMIUM ALLOWANCE
14. Deduction of premium allowance
PART IV
GENERAL PROVISIONS
15. Successions
16. Subsidies
17. Controlled sales
PART V
RATES OF INITIAL AND WEAR AND TEAR ALLOWANCES
18. Rates of initial and wear and tear allowances
PART VI
MINING DEDUCTIONS
19. Interpretation of terms
20. Capital expenditure deductions
21. Prospecting expenditure deductions
22. Mining expenditure deductions
22A Dissallowance of interest in certain areas
23. Deductions for mining expenditure on non-producing and
non-contiguous mine
24. Deductions on cessation of mining operations
25. Change of ownership of mine
26. Controlled sales
27. Petroleum operations
SIXTH SCHEDULE-Farming-Improvement and Works Alllowances,
and Livestock Valuation
PART I
FARM IMPROVEMENT ALLOWANCE
Paragraph
1. Definitions
2. Farm improvement allowance
3. Divided use
PART II
FARM WORKS ALLOWANCE
5. Nature of farm works
6. Farm works allowance
PART III
VALUATION OF LIVESTOCK
7. Standard value
SEVENTH SCHEDULE-Repealed by Act No. 2 of 1995
NINTH SCHEDULE
Presumptive Tax
CHARGING SCHEDULE
PART I
TAX CREDITS
Paragraph
1. Tax Credit
PART II
RATES OF TAX
2. Individuals
3. Companies etc.
4. Trust
5. Special cases
6. Withholding tax
7. Rate of tax to be deducted
8. Interpretation
CHAPTER 323
INCOME TAX
An Act to provide for the taxation of incomes and
Act No.
32 of 1967
23 of 1968
11 of 1969
26 of 1970
matters connected therewith. 27 of 1970
17 of 1971
16 of 1972
11 of 1973
14 of 1973
46 of 1973
11 of 1974
11 of 1975
14 of 1976
9 of 1977
9 of 1978
10 of 1979
19 of 1979
6 of 1980
10 of 1981
13 of 1981
12 of 1982
21 of 1982
11 of 1984
11 of 1985
8 of 1986
14 of 1987
17 of 1988
28 of 1988
33 of 1989
15 of 1990
29 of 1990
12 of 1991
11 of 1992
4 of 1993
13 of 1994
14 of 1994
2 of 1995
27 of 1995
7 of 1996
3 of 1997
9 of 1998
6 of 1999
4 of 2000
1 of 2001
8 of 2001
3 of 2002
3 of 2003
1 of 2004
1 of 2005
7 of 2006
PART I
PRELIMINARY AND INTERPRETATION
1. (1) This Act may be cited as the Income Tax Act *
(2) This Act shall come into operation on the 1st April, 2006, and
subject to any provisions to the contrary, shall have effect in relation to
the charge of tax for the charge year which ends on 31st March, 2007,
and in relation to each subsequent charge year.
(As amended by Act No.6 of 1999, Act No. 4 of 2000, No. 1 of 2001, No.
8 of 2001, No.3 of 2002, No. 1 of 2004, No. 1 of 2005 and No. 7 of 2006)
Short title and
commencement.
Cap. 323
2. (1) In this Act, unless the context otherwise requires-
"approved annuity contract" means a contract providing for the payment
to an individual of a life annuity which has been approved by the
Commissioner-General under the Fourth Schedule;
"approved fund" means-
(a) an approved pension fund;
(b) an approved annuity contract;
(c) any superannuation, pension, provident, widows' or orphans'
fund established by law in the Republic;**
(d) a pension fund approved before the enactment of this Act under
either subsection (1) or (2) of section eleven of the former Act;
* This Act came into operation on the 1st April, 1966.
** shall be deemed to have come into operation on the first February,
2000, and subject to any provisions to the contrary shall have effect in
relation to the assessments for the charge year wich ends on 31st March,
2000 and in relation to each subsequent charge year.
"approved pension fund" means a pension fund or scheme which has
been approved by the Commissioner-General under the Fourth
Schedule;
"approved share option scheme" means a scheme that has been
approved by the Commissioner-General, under the Eighth Schedule;
"assessable income" means the amount of a person's income liable to tax
which may be included in an assessment and which remains after
allowing the deductions, to which that person is entitled under the
provisions of this Act;
"assessment" means the determination of an amount of tax which a
person shall be liable to pay under the provisions of this Act;
"Authority" means the Zambia Revenue Authority established under the
Interpretation
Zambia Revenue Authority Act;
"Bank" means a company that holds a banking licence granted under
section four of the Banking and Financial Services Act:
"bankrupt's estate" means the property of a bankrupt vested by law in
and under the control of the trustee in bankruptcy;
"bank subsidiary" means a company where more than fifty per centum
of the voting shares of the company (except any qualifying director's
shares) are owned directly or indirectly by a bank;
"base metals" means a non-precious metal that is either common or
more chemically active, or both common and chemically active and
includes iron, copper, nickel, aluminuim, lead, zinc, tin, magnesium,
cobalt, manganese, scandium, vanadium and chromium;
"basic salary" means the gross amount payable to an employee without
any allowances;
"beneficiary", in relation to a terminal benefit, means the individual to
whom such benefit is payable;
"business" includes-
(a) any profession, vocation or trade;
(b) any adventure or concern in the nature of trade whether singular
or otherwise;
(c) manufacturing; and
(d) farming;
"charge year" means the year for which tax is charged, that is, the period
of twelve months ending on the 31st March, and each succeeding such
year;
"Charging Schedule" means the last Schedule to this Act, by which, tax
credits and rates of tax are fixed;
"child" includes a step-child, a lawfully adopted child, an illegitimate
child and any child to whom an individual stands in place of a parent;
"Commissioner-General" means the Commissioner-General appointed
under the Zambia Revenue Authority Act;
"company" means any company incorporated or registered under any
law in force in the Republic or elsewhere;
"date of enactment of this Act" means the 20th May, 1967, and
"enactment of this Act" shall be construed accordingly;
"deceased's estate" means the estate of a deceased individual;
"dividend" means any amount distributed or credited (as construed in
subsection (3) by a company to its shareholders or any amount deemed
Cap. 321
Cap. 387
Cap. 321
to have been distributed pursuant to the provisions of section ninety-five;
"effective shareholder", in relation to a company, means a person who is
the beneficial owner of or able to control, either alone or the nominees
of that person, five per centum or more of the issued share capital of or
voting powers in such a company;
"emolument" means any salary, wage, overtime or leave pay,
commission, fee, bonus, gratuity, benefit, advantage (whether or not that
advantage is capable of being turned into money or money's worth),
allowance, including inducement allowance, pension or annuity, paid,
given, or granted in respect of any employment or office, wherever
engaged in or held;
"employee", in relation to an employer, means any individual who is
paid, given or granted any emolument by that employer;
"employer", in relation to an employee, means any person who or any
partnership which pays, gives or grants any emoluments to that
employee;
"farming" means any husbandry, pastoral, poultry, fish rearing, or
agricultural activity and but excludes the letting of any property for any
such purpose;
"financial institution" means a person that holds a financial institution's
licence granted under section ten of the Banking and Financial Services
Act;
"incapacitated person" means any child who has not attained the age of
twenty-one years, person of unsound mind, lunatic, idiot or insane
person;
"individual" means a natural person;
"local authority" means a City Council, District Council, Municipal
Council or any other authority recognised as such under the Local
Government Act.
"loss", in relation to gains or profits, means the loss computed in like
manner as gains or profits;
"lump sum payment" means-
(a) in relation to a beneficiary who was employed within the Republic
through out the period during which contributions were made, an
amount equal to the terminal benefit received by him;
(b) in relation to a beneficiary who was not so employed, an amount that
bears the same proportion to the terminal benefit received by him as the
period of his employment within the Republic for which contributions
were made bears to the total period of his employment for which
contributions were made; and
Cap. 387
Cap. 281
(c) in relation to a beneficiary who is employed on pensionable terms,
any amount received or accrued which is paid or payable by an
employer upon cessation of employment, by way of compensation for
leave due but not taken.
"management or consultant fee" means a payment in any form other
than an emolument for or in respect of any managerial, administrative,
technical or consultative service or any service of a like nature;
"manufacturer" means a person carrying on the business of
manufacturing;
"manufacturing" means subjecting any physical matter to any process
which materially changes such material in substance, character or
appearance, thereby making it an article after such process, and includes
the assembly of motor vehicles and such other processes as the
Commissioner-General may determine to be of a similar nature;
"mineral" includes any valuable crystalline or earthy substance forming
part of or found within the earth's surface and produced or deposited
there by natural agencies, but does not include any clay (other than
fireclay), gravel, sand, stone (other than limestone) or other like
substance ordinarily won by the method of surface working known as
quarrying;
"mining operations" means-
(a) any operations for the purpose of winning a mineral from the earth;
and
(b) any operations for the purpose of winning a mineral from any
substance or constituent of the earth which are carried on in conjunction
with operations referred to in paragraph (a) by the persons carrying on
those operations;
and "mine", whether used as a noun or a verb, is construed accordingly;
"minister" means the minister responsible for financial matters;
"nominee", in relation to an individual, means-
(a) the spouse of the individual; or
(b) the child of the individual; or
(c) a person who holds shares in a company directly or indirectly on
behalf of the individual; or
(d) a person who can be required to exercise or a person who can require
the exercise of voting powers in the affairs of a company in accordance
with directions of the individual;
unless the Commissioner-General determines that the spouse, child or
other person is a person who can at all times exercise or require the
Act No. 33 of 1996
exercise of voting powers in the affairs of the company otherwise than
in accordance with the directions of the individual;
"non-traditional product" means anything, other than minerals and
electricity, produced or manufactured in the Republic but excludes
services;
"pensionable terms" means terms and conditions of employment under
which an employee belongs to any approved pension fund operated by
an employer for the benefit of his employee;
"person" includes any body of persons, corporate or otherwise, a
corporation sole, a local or like authority, a deceased's estate, a
bankrupt's estate and a trust, but does not include a partnership;
"person with disability" has the meaning assigned to it under section two
of the Persons with Disabilities Act, 1996;
"prospecting and exploration operations" means-
(a) any operations for the purpose of searching for mineral deposits; or
(b) any operations for the purpose of defining the extent and
determining the value of a mineral deposit;
"public entertainment fee" means a payment in any form other than an
emolument to, on behalf of, or in respect of, any person or persons in
partnership, including theatre, motion picture, radio or television artists,
musicians, athletes or sports persons, in respect of those persons'
personal activities in any entertainment, competition or similar activity
within the Republic;
"registered insurer" means an insurer registered under Part II of the
Insurance Act;
"retirement age" means the age specified in the rules of an approved
fund as the age of retirement or, if no age is specified in the rules,
fifty-five years of age;
"royalty" means a payment in any form received as a consideration for
the use of, or the right to use, any copyright of literary, artistic or
scientific work (including cinematograph films and films and tapes for
radio or television broadcasting), any patent, trade mark, design or
model, plan, secret formula or process, or for the use of, or the right to
use, industrial, commercial or scientific equipment, or for information
concerning industrial, commercial or scientific experience;
"rural area" means any area which is not an area declared or deemed to
have been declared an area of any city or municipality or township under
the Local Government Act;
"rural enterprise" means-
(a) a manufacturing business which commenced on or after the 1st
April, 1976;
(b) a hotel, motel or lodge which commenced on or after the 1st
April, 1981;
and which is located in a rural area.
"services" means any services provided in the normal course of business
by a person engaged in any business activity specified in the Third
Schedule;
"share option scheme" means a scheme that provides an option to an
employee to acquire acquire shares in the company that employs that
employee or otherwise.
"tax" means the income tax charged by this Act;
"taxpayer identification number" means the National Registration Card
Number or such other number as may be designated and issued by
Commissioner-Genreal to a taxpayer;
"terminal benefit" means the amount payable from a fund or scheme,
approved as an approved fund or as a benefit fund or pension fund at any
time under the law relating to the taxation of income in the Republic
prior to the enactment of this Act to an individual who is or was a
member of that fund or scheme, on cessation of employment,
withdrawal from or the winding up of the fund or scheme, but does not
include an amount received-
(a) by way of annuity;
(b) in respect of services; or
(c) on account of sickness or disability;
"whole time service director" means a director of a company who is
required to devote substantially the whole of his time to the service of
such company in a managerial or technical capacity and is not the
beneficial owner of, or able to control alone or with his nominees, five
per centum or more of the issued share capital of or voting powers in
such company;
(As amended by Act No. 3 of 1997, Act No.9 of 1998, Act No.6 of 1999, Act No. 4 of
2000, No. 3 of 2002 and no. 7 of 2006)
(1A) Subject to subsection (1B) where a provsision of the Act refers,
expressly or by implication, to a payment of a specified amount which is
denominated in kwachc and the payment is made in another currency
the amount of the payment, for purposes of that provision, shall be
converted into kwach at the appropriated rate published by the Bank of
zambia as at the end of the day on which the payment is due, irrespective
of when the payment is actually made.
(1B) Where the payment referred to in subsection (1A) is a payment of
interest and the borrower has borrowed the principal in the course of a
business carried on by the borrower, the conversion required by
subsection (1A) shall, subject to any direction by the
Commissioner-General, be calculated as at the end of each day on which
the interest accrues, irrespective of when payment of the interest is due.
(2) For the purposes of this Act, a beneficiary who was employed
outside the Republic by the Government, or the Government of the
former Federation, or a local authority or statutory corporation, during
any period in which ordinary contributions were made, is, if he was
resident outside the Republic only for the purpose of that employment,
deemed to have been employed within the Republic during that period.
(3) The reference in the definition of "dividend" to "amount distributed
or credited" shall be read and construed-
(a) so as to include-
(i) in relation to a company that is being wound up or liquidated,
any profits distributed, whether in cash or otherwise, other than those of
a capital nature, earned before or during the winding up or liquidation;
(ii) in relation to a company that is not being wound up or liquidated,
any profits distributed, whether in cash or otherwise, other than those of
a capital nature, including the value of that element of any shares
awarded to its shareholders which is redeemable or capable of
redemption by conversion and any debentures or securities awarded to
its shareholders by a company;
(iii) in the event of the partial reduction of the capital of a company,
any cash or the value of any asset which is given to the shareholder in
excess of the cash equivalent of the nominal value by which the shares
of that shareholder are reduced; and
(iv) in the event of the reconstruction of a company, any cash or the
value of any asset which is given to the shareholder in excess of the
nominal value of the shares held by him before reconstruction;
(b) so as not to include any cash or the value of any asset given to a
shareholder, to the extent to which the cash or the value of the said asset
represents a reduction of the share premium account of the company.
(4) Any reference in this Act to bankruptcy shall be construed in
accordance with the provisions of the Bankruptcy Act, and
"bankruptcy" shall be construed accordingly.
Cap. 82
(As amended by Acts No. 23 of 1968, No. 11 of 1969,
No. 26 of 1970, No. 17 of 1971, No. 16 of 1972, No. 11 of 1973,
No. 7 of 1996, No. 3 of 1977 and Act No.6 of 1999)
3. Repealed by Act No. 7 of 1996.
4. (1) An individual is, for the purposes of this Act, not treated as a
resident in the Republic who is in the Republic for some temporary
purpose only and not with any view or intent of establishing his
residence therein, and who has not actually resided in the Republic at
one time or several times for a period equal in the whole to one hundred
and eighty-three days in any charge year, but if any such individual
resides in the Republic for the aforesaid period he shall be treated as
resident for that year.
Resident
(2) Repealed by Act No. 4 of 2000
(3) In this Act, a person other than an individual is resident in the
Republic for any charge year
(a) if the person is incorporated or formed under the laws of
the Republic; or
(b) central management and control of the person's business or affairs
are exercised in the Republic for that year.
(As amended by Act No. 11 of 1969 and No. 4 of 2000 and No. 1 of
2001)
5. (1) In this Act, income is received by a person when, in money or
money's worth, or in the form of any advantage, whether or not that
advantage is capable of being turned into money or money's worth, it is
paid, given or granted to him, or it accrues to him or in his favour, or it is
in any way due to him or held to his order or on his behalf, or it is in any
way disposed of according to his order or in his favour, and the word
"recipient" is construed accordingly.
Receipt of income
(2) For the purposes of this Act-
(a) a dividend shall be deemed to accrue to share or stock holders, in the
case of a dividend paid by a company which is being wound up or
liquidated, on the day the dividend is received as provided in subsection
(1), and in the case of a dividend paid by a company which is not being
wound up or liquidated, on the day of the resolution declaring the
dividend:
Provided that where the resolution states that the dividend is to
be paid to share or stock holders registered on a day in the future, the
dividend shall be deemed to accrue to the share or stock holders on that
day in the future; and
(b) a dividend accuring to a person which is deemed by virtue of any
provision of this Act to be income of some other person shall be deemed
to accrue to that other person on the day the dividend is by virtue of the
provisions of paragraph (a) deemed to accrue.
and No. 10 of 1979 and Act No.6 of 1999)
PART II
ADMINISTRATION
6. (1) The Commissioner-General shall be responsible for carrying out
the provisions of this Act.
Appointment of staff
(2) The Commissioner-General shall appoint staff of the Direct Taxes
Division of the Authority.
(As amended by Act No. 7 of 1996)
7. (1) The Commissioner-General may delegate to any officer in the
Direct Taxes Division any power or duty by this Act conferred or
imposed upon him, other than those conferred on him by section one
hundred and four and this power of delegation, and, save as especially
provided by this Act, any decision made or any notice or communication
issued or signed by any such officer may be amended or withdrawn by
the Commissioner-General, or by the officer concerned, and shall, for
the purposes of this Act, until it has been so withdrawn, be treated as
having been made, issued or signed by the Commissioner-General.
officers and
delegation of
functions
(2) Every officer appointed for the purposes of carrying out the
provisions of this Act is under the Commissioner-General's direction
and control, and shall perform such duties as may be required by the
Commissioner-General.
(3) The Commissioner-General may confer any of the functions of the
Commissioner-General under this Act upon any person if that person
consents; and that person shall perform those functions under the
direction of the Commissioner-General.**
(As amended by Acts No. 2 of 1995 and No. 7 of 1996 and No. 4 of 2000
and No. 1 of 2001)
8. (1) Any individual who- Secrecy
(a) is, or at any time has been, an officer appointed for the purpose of
carrying out the provisions of this Act; or
(b) has at any time been given official access to documents or matters
arising under this Act; or
(c) Repealed by Act No. 7 of 1996;
(d) is, or at any time has been, the Chairman, Deputy Chairman, Special
Chairman, or an employee of the Tax Appeal Court or its successor;
shall preserve and aid in preserving secrecy concerning the affairs of
any person under this Act, save as the duty under this Act of that
individual requires:
Provided that-
(i) the Commissioner-General may disclose any information, record or
document to the Minister or to any public officer authorised by the
Minister in writing and to the Director of Public Prosecutions when
acting in exercise of his powers under the Anti-Corruption Commission
Act;
Cap. 91
(ii) any individual appointed for carrying out the provisions of this Act
may disclose any information, record or document to the
Auditor-General and any officer authorised by the Auditor-General;
(iii) no individual who is, or at any time has been, an officer appointed
for the purpose of carrying out the provisions of this Act shall be
required to produce in any court any document or to communicate to
any court any information which has come into his possession or to his
knowledge in the performance of his duties under this Act, except as
may be necessary for the purpose of carrying out the provisions of this
Act.
(2) Any individual who is in contravention of subsection (1) who uses
or reveals any information, record or document disclosed to him in
accordance with the proviso to subsection (1) save as his official duties
require shall be guilty of an offence punishable with imprisonment for a
term not exceeding two years or with a fine not exceeding two hundred
penalty units, or to both.
(Amended by Acts No. 17 of 1971, No. 14 of 1973, No. 14 of 1976, No. 8
of 1986, No. 13 of 1994, No. 14 of 1994 and No. 7 of 1996 and No. 4 of
2000)
9. The Minister may make regulations by statutory instrument in
furtherance of and incidental to the provisions of this Act.
Regulations
10. The Commissioner-General shall cause a record to be kept of every
assessment made under this Act.**
Record of assessment
** shall be deemed to have come into operation on the first February, 2000, and subject to
any provisions to the contrary shall have effect in relation to the assessments for the charge
year wich ends on 31st March, 2000 and in relation to each subsequent charge year.
11. (1) All forms required for the administration of this Act shall be as
prescribed by the Commissioner-General from time to time.
Forms and notices
(2) Notices, forms, demands or other documents issued or given by the
Commissioner-General under this Act may be signed by any officer
authorised by the Commissioner-General in that behalf, and any such
notice, form, demand or other document purporting to be signed by
order of the Commissioner-General shall be as valid as if signed by the
(As amended by Acts No. 26 of 1970 and No. 7 of 1996)
12. (1) References in this section to the giving of notice include any
service of process under this Act.
Notices and service
(2) Notice to any individual under this Act is given to him-
(a) at the time it is served on him personally or electronically; or
(b) at the time it is left with some adult individual apparently living or
occupying or employed at his last known abode, office or place of
business; or
(c) unless the addressee proves to the contrary, ten days after it has been
sent by post to his last known abode, or office, or to his postal address as
notified by him to the Commissioner-General, or in care of his last
known employer.
(3) Notice is given to any company at the time it is given to that
company's taxpaying agent (as determined in section sixty-six) in the
manner provided by subsection (2), or at the time it is sent, in the case of
a company incorporated in the Republic, to the registered office of the
company, and in the case of a company incorporated outside the
Republic, either to the individual authorised to accept service of process
Cap. 388
under the Companies Act at the address filed with the Registrar of
Companies, or to the registered office of the company wherever it may
be situated, or, in either case, to any premises in the Republic where the
company is carrying on business.
(4) Notice is given to any body corporate, other than a company, at the
time it is given to the principal officer, secretary, accountant or manager
in the Republic of such body corporate in a manner provided by
subsection (2), or at the time it is sent to the registered address, if any, of
the said body corporate, or to any premises in the Republic where the
said body corporate exercises any of its functions or powers.
(5) Notice to the Commissioner-General under this Act is given to him-
(a) at the time it is served upon him personally, electronically or upon
any officer of the Direct Taxes Division duly authorised by the
Commissioner-General to receive such notice; or
(b) unless the Commissioner-General proves to the contrary, ten days
after it has been sent by post addressed to the Commissioner-General or
any officer of the Direct Taxes Division duly authorised by the
Commissioner-General to receive such notice.
(As amended by Acts No. 11 of 1975, No. 7 of 1996 and No. 1 of 2004)
(6) In this section, the term "post" means registered or unregistered
post.
(7) Notice of any change in the place of abode or the postal address of
any person receiving income assessable to tax shall be delivered in
writing by that person to the Commissioner-General within thirty days
of such change.
PART III
CHARGE OF TAX
14. (1) Subject to the provisions of this Act, tax shall be charged at the
rates set out in the Charging Schedule for each charge year on the
income received in that charge year-
Charge of tax
(a) by every person from a source within or deemed to be within the
Republic; and
(b) by any individual ordinarily resident in the Republic, or by every
person, not being an individual, who is resident in the Republic, by way
of interest and dividends from a source outside the Republic.
(2) Subject to the other provisions of the Act, in the case of an
individual, the amount of tax which, apart from this subsection,
would be charged in respect of any income received by that person
in that charge year shall be reduced by the amount of the tax credit
appropriate to such person for that charge year as specified in the
Charging Schedule and that person shall be liable to pay tax for that
charge year an amount equal to that reduced amount:
Provided that any assessment of that income shall-
(a) be for the whole amount of tax due beforeany tax credit; and
(b) show the amount due and payable after reduction by the amount
of any credit due.
(3) Any amount of tax payable before the application of a tax credit
shall not be reduced below zero by the tax credit and the tax credit shall
not give rise to a repayment of tax.
(4) The amount of a tax credit to which a person is entitled for any
charge year shall not be allowed more than once against that person's
income for that year.
(5) An individual shall not be entitled to a tax credit except-
(a) against income provided for under section seventy-one and if the
tax credit is allowable in accordance with Regualtions made under
section; or
(b) against income declared in a return under section forty-six;
(6) The provisions of this Part, and of the First Schedule, relating to
particular forms of income, are without prejudice to the generality of
the charge of subsection (1).
No. 12 of 1982, No. 11 of 1992, No. 4 of 1993, No.9 of 1998 and Act
No.6 of 1999)
15. (1) There shall be exempt from tax the persons, funds, charities and
income declared to be exempt in the Second Schedule to the extent
specified therein.
Exemptions from tax
(2) The Minister may, by statutory order, approve, for the purposes of
exemption from tax, any person, agency, organisation or foundation,
which may be so approved by him by order in the Gazette pursuant to
the Second Schedule, and may, by like order, exempt from tax the
income or emoluments of any person, agency, organisation or
foundation which may be so exempted by him by order in the Gazette
pursuant to the said Schedule, and may, at any time, by like order,
revoke any such order:
Provided that the Minister shall have the power to make or revoke such
orders retrospectively.
15A. (1) The Minister may by regulation- Suspension and rebate
of income tax
(a) suspend or provide for the suspension of the whole or part of any
income tax due and payable under this Act;
(b) grant or provide for the grant of a refund of the whole or any part of
income tax payable under this act;
in such circumstances, subject to such conditions and to such extent, as
may be provided by or determined under the regulation.
(2) Regulations under this section suspending any payment of income
tax or granting a rebate or refund may, if the Minister considers it
expedient, be made with retrospective effect.
16. Where the Commissioner-General is satisfied that any income
cannot be remitted to the Republic in the charge year in which it
accrues, then he may, if the person chargeable to tax in respect of that
income so requests, determine that income shall not be chargeable to
tax in the charge year in which it accrues but that it shall be chargeable
to tax in the charge year in which it may first be remitted to the
Republic:
Chargeability of
income that cannot be
remitted on accrual
Provided that the tax chargeable on such income shall not exceed the
tax that would have been charged on the income if it had been charged
to tax in the charge year or years in which it accrued.
17. For the purposes of this Act, income includes, for any charge year-
(a) gains or profits from any business for whatever period of time
carried on;
(b) emoluments;
(c) annuities;
Classification of
income
(d) dividends;
(e) interest, charges and discounts;
(f) royalties, premiums or any like consideration for the use or
occupation of any property;
(g) income from the letting of property; and
(h) the income as further classified in the First Schedule.
(As amended by Acts No. 23 of 1968, No. 12 of 1982
and No. 14 of 1987)
18. (1) Income is deemed to be from a source within the Republic if
that income-
Income deemed
within the Republic
(a) arises under any agreement made in the Republic for the sale of
goods, irrespective of whether those goods have been or are to be
delivered in the Republic;
(b) is remuneration from employment exercised or office held in the
Republic or if it is received by virtue of any service rendered or work or
labour done by a person or partnership in the carrying on in the
Republic of any business, irrespective of whether payment is made
outside the Republic, or by a person resident outside the Republic;
(c) is remuneration for services rendered outside the Republic to the
Government or any statutory corporation if the person rendering the
services is resident outside the Republic solely for that purpose;
(d) is a pension granted by a person wherever resident, irrespective of
where the funds from which it is paid are situated, or where payment is
made, except where the employment or office for which the pension is
granted was wholly outside the Republic, and the emoluments were
never charged to tax in the Republic;
(e) arises from interest incurred in the production of income or in the
carrying on of a business in the Republic or paid directly or indirectly
out of funds derived from within the Republic;
(f) arises from a royalty incurred in the production of income or in the
carrying on of a business in the Republic or paid directly or indirectly
out of funds derived from within the Republic;
(g) arises from the carriage, by a person who is not resident in the
Republic, of passengers, mails, livestock or goods embarked, shipped
or loaded in the Republic other than passengers embarking in transit
through the Republic or mails, livestock or goods shipped or loaded on
transhipment through the Republic; or
(h) arises from a management or consultant fee incurred in the
production of income or in the carrying on of a business in the Republic
and is received by a person or persons in partnership for a service other
than such part thereof as is rendered by the person or persons in
partnership in the carrying on of a business in the Republic.
(2) Where a business is carried on partly within and partly outside the
Republic by a person to whom this subsection applies receives a share
of the profits of a business carried on in partnership partly within and
partly outside the Republic, the whole of the person's share of the
profits of the business or partnership is deemed to have been received
from a source within the Republic.
(3) Subsection (3) shall apply to-
(a) any individual who is ordinarily resident in the Republic; and
(b) to any person, not being an individual, who is resident in the
Republic.
(As amended by Acts No. 23 of 1968, No. 26 of 1970, No. 17 of 1971,
No. 16 of 1972, No. 3 of 1997 and Act No.9 of 1998)
19. (1) Where under the terms of any settlement and during the life of
the settlor any income, or assets representing it, will or may become
payable or applicable to or for the benefit of any child of the settlor and
at the commencement of the charge year the child is unmarried and has
not attained the age of twenty-one years, the income or assets
representing it shall be deemed to be income of the settlor and, not
income of any other person.
Income deemed
received
(2) If and so long as the terms of any settlement are such that-
(a) any person has or may have power, whether immediately or in the
future, and whether with or without the consent of any other person, to
revoke or otherwise determine the settlement or any provision thereof;
and
(b) in the event of the exercise of the power, the settlor or the wife or
husband of the settlor will or may become beneficially entitled to the
whole or any part of the property then comprised in the settlement, or of
the income arising from the whole or any part of the property so
comprised;
all income arising under the settlement from the property comprised in
the settlement shall be deemed to be income of the settlor and, subject to
the provisions of subsection (1), not income of any other person:
Provided that this subsection shall not apply by reason only that the
settlor or the wife or husband of the settlor will or may become
beneficially entitled to any income or property relating to the interest of
any beneficiary under the settlement in the event that such beneficiary
should pre-decease him.
(3) Where in any charge year the settlor or any relative of the settlor or
any person under the direct or indirect control of the settlor or of any of
his relatives, whether by borrowing or otherwise, makes use of any
income arising or of any accumulated income which has arisen under a
settlement to which he is not entitled thereunder, then the amount of
such income or accumulated income so made use of shall be deemed to
be income of the settlor for the charge year and not income of any other
person.
(4) Where under the terms of any settlement to which this section
applies any tax is charged on and paid by the person by whom the
settlement is made, that person shall be entitled to recover from any
trustee or other person to whom income is paid under the settlement the
amount of the tax so paid, and for that purpose to require the
Commissioner-General to furnish a certificate specifying the amount of
tax so paid, and any certificate so furnished shall be conclusive
evidence of the facts appearing therein.
(5) If any question arises as to the amount of any payment of income or
as to any apportionment of income under this section, that question
shall be decided by the Commissioner-General, whose direction
thereon shall be final.
(6) This section applies to every settlement wheresoever it was made or
entered into and whether it was made or entered into before or after the
commencement of this Act and shall (where there is more than one
settlor or more than one person who made the settlement) have effect in
relation to each settlor as if he were the only settlor.
(7) In this section-
"settlement" includes any disposition, trust, covenant, agreement,
whether reciprocal or collateral, arrangement or transfer of assets or
income, but does not include-
(i) a settlement which in the opinion of the Commissioner-General is
made for valuable and adequate consideration;
(ii) a settlement resulting from an order of a court;
(iii) any agreement made by an employer to pay to an employee or to
the widow or any relative or dependant of such employee after his death
such remuneration or pension or lump sum as the
Commissioner-General may determine;
"settlor", in relation to a settlement, includes any person by whom the
settlement was made or entered into directly or indirectly, and any
person who has provided or undertaken to provide funds or credit
directly or indirectly for the purposes of the settlement, or has made
with any other person a reciprocal arrangement for that other person to
make or enter into the settlement.
(As amended by Acts No. 11 of 1969, No. 7 of 1996 and Act No.9 of
1998 )
21. (1) Where, upon the termination of a written contract of
employment after minimum period of two years completed service
thereunder or such lesser period as the Commissioner-General may, in
his discretion, deem reasonable, income is received under the terms of
the contract by any individual by way of gratuity, then such income
shall be charged in the charge year in which it is received at the
appropriate rates applicable thereto pursuant to the Charging Schedule:
Appointment of
gratuities and
compensation for
loss office
Provided however that-
(i) any income received by way of gratuity in excess of twenty-five per
centum of the basic salary earned during the period of employment to
which such gratuity is related, shall, to the extent of such excess, be
regarded and dealt with, for the purposes of this Act, as income received
other than by way of gratuity;
(ii) any emoluments paid by way of gratuity by any company to any
individual who is, or was at any time during the period of employment
to which such gratuity is related, an effective shareholder of such
company or who is, or was at any time a director of such company
during the period of employment to which such gratuity is related, other
than a whole time service director thereof, shall, for the purposes of this
Act, be regarded and dealt with as income received by such individual
other than by way of gratuity;
(iii) any emoluments paid by way of gratuity by an employer to an
individual where the spouse of the individual, either alone or in
partnership, is the employer of the individual shall, for the purposes of
this Act, be regarded and dealt with as income received other than by
way of gratuity;
(iv) any emoluments paid by way of gratuity by a company to an
individual who or whose spouse is carrying on a business alone or in
partnership and the services of the individual are provided to such a
business by such company, shall for the purposes of this Act, be
regarded and dealt with as income received other than by way of
gratuity; and
(v) where the conditions of this subsection are not complied with in
respect of any emoluments paid to any individual by way of gratuity,
such emoluments shall for the purposes of this Act, be regarded and
dealt with as income received by such individual other than by way of
gratuity.
(2) Where, upon the termination of a contract of employment, income
is received by an individual by way of compensation for leave due but
not taken, such income, if the individual irrevocably so elects, shall be
regarded as accruing, and as being paid, proportionately on the last day
of each month over the period during which the leave would have been
taken, commencing with the first day after the date of termination of
contract.
(3) Where, during the continuance of any employment, income by way
of payment in advance for a leave period, is received by an individual
proceeding on leave with the intention of resuming his employment at
the termination of such leave period, such income shall be regarded as
accruing and being paid proportionately on the last day of each month
during the continuance of the period of leave.
(4) Where, as the result of any law, judicial order or judgement or the
acceptance by an employer of any independent award or of
representations by recognised association of employees, income is
received by an individual by way of arrears of income in respect of
present or past employment, such income shall be regarded as having
accrued and as having been paid during the years to which such arrears
relate, whether charge years under this Act or years of assessment under
any previous law.
(5) Where, upon the termination of the services of any individual in any
office or employment, income is received by such individual by way of
compensation for loss of office or employment, including termination
for reason of redundancy or early retirement, normal retirement or
death, the first ten million kwacha of such income shall be exempt from
income tax.
No. 11 of 1992, No. 4 of 1993, No. 14 of 1994, No. 7 of 1996, Act No.6 of
1999, No. 3 of 2002 and No. 1 of 2005)
22. Where in the case of any business it is necessary in order to arrive at
the income of the business for any charge year or other period to divide
and apportion to specific periods the income for any period for which
accounts have been made up or to aggregate such income or any
apportioned parts thereof, it shall be lawful to make such a division and
apportionment or aggregation, and any apportionment under this
Apportionment of
income
section shall be made in proportion to the number of days in the
respective period, unless the Commissioner-General, having regard to
any special circumstances, otherwise determines.
23. (1) Where in computing gains or profits for any charge year any
expenditure or loss has been deducted or a deduction in respect of any
reserve or provision to meet any liability has been made, and in a later
charge year the whole or part of the expenditure or loss is recovered, or
the whole or part of the liability is released, or the retention in whole or
in part of the reserve or provision has become unnecessary, then any
amount so recovered or released or no longer required as a reserve or
provision shall be deemed to be gains or profits of the charge year in
which it is recovered or released or no longer required:
Provisions relating to
income from business
(2) Any amount received under any insurance against loss of profits, or
received by way of damages or compensation for loss of profits, shall be
deemed to be gains or profits of the charge year in which it is received.
(As amended by Act No. 27 of 1970 and Act No.9 of 1998)
24. Where any amount is received by any person after the cessation of
his business which, if it had been received prior to the cessation, would
have been included in the gains or profits from the business, then, to the
extent to which that amount has not already been included in the gains
or profits, that amount shall be income of such person for the charge
year in which it is received.**
** shall be deemed to have come into operation on the first February,
2000, and subject to any provisions to the contrary shall have effect in
relation to the assessments for the charge year wich ends on 31st March,
2000 and in relation to each subsequent charge year.
Provisions relating to
income after cessation
of business
25. The gains or profits of an insurance business are ascertained in
accordance with the provisions of the Third Schedule.
Insurance business
26. Where a business is carried on by two or more persons in
partnership, the income of any partner from the partnership for any
period is the share to which he was entitled in that period, such income
being ascertained in accordance with the provisions of this Act and that
share shall be assessed and charged on him accordingly.
Income of partner
27. (1) This section applies to the income of a trust or of a deceased's
estate.
Special provisions
relating to deceased's
estate and trusts
(2) For the purposes of this Act, an amount received or forming part of
the assets of a deceased's estate which became due and payable before
the death of the deceased person and which the deceased person had a
right to claim in his lifetime shall be treated as income received by the
deceased person on the date the amount became due and payable if the
amount would have been income of the deceased person had it been
received by him in his lifetime.
(3) An amount received by a deceased's estate which did not become
payable before the death of the deceased person shall be income of the
deceased's estate for the purposes of this Act if the amount would have
been income of the deceased person had it been received or been
deemed to have been received by him in his lifetime:
Provided that any income received by way of emoluments earned by the
deceased person during his lifetime shall be deemed to be income
received by the deceased person on the date of his death.
(4) Where a beneficiary is entitled to the whole or part of the income of
a trust or deceased's estate, the Commissioner-General may, instead of
assessing and charging the whole or part of the income on the trustees
or executor or administrator, determine that the income of the trust or
deceased's estate attributable to the beneficiary's interest for any charge
year or any amount paid out of the income of the trust or deceased's
estate on behalf of the beneficiary in any charge year shall, for the
purposes of this Act, be assessed and charged on the beneficiary as if it
were his income.
28. (1) The income that is deemed under paragraph (g) of subsection
(1) of section eighteen to be from a source within the Republic for any
period shall be an amount bearing the same proportion to the amounts
received in respect of the carriage of passengers, mails, livestock or
goods embarked, shipped or loaded in the Republic as the total gains or
profits of such business for the period bear to the total amount received
for the period for the carriage of passengers, mails, livestock or goods.
Income of
non-resident air, sea
or land transport
business
(2) The Commissioner-General may accept as evidence of the total
gains or profits and total amount mentioned in subsection (1), a
certificate of such gains or profits and amount issued by or on behalf of
any income tax authority which the Commissioner-General is satisfied
computes the gains or profits of the business on a basis not materially
different from that provided in this Act.
(3) Where at the time of assessment, the provisions of subsection (1)
cannot for any reason be satisfactorily applied, the income from the
Republic may be computed at such percentage of the full amount
received which is attributable to the carriage of passengers, mails,
livestock or goods embarked, shipped or loaded in the Republic as the
Commissioner-General may determine.
(4) Any person assessed under the terms of subsection (3) in respect of
any charge year may claim at any time within six years after the end of
the charge year that his liability to tax be recomputed on the basis
provided by subsection (1).
(As amended by Acts No. 11 of 1975, No. 14 of 1976, No. 9 of 1977, No.
10 of 1981 and No. 11 of 1984)
PART IV
DEDUCTIONS
29. (1) Subject to the provisions of this Part- Deductions generally
(a) in ascertaining business gains or profits in any charge year, there
shall be deducted the losses and expenditure, other than of a capital
nature, incurred in that year wholly and exclusively for the purposes of
the business; and
(b) in ascertaining income from a source other than business, only such
expenditure, other than expenditure of a capital nature, is allowed as a
deduction for any charge year as was incurred wholly and exclusively in
the production of the income from that source.
Provided that on the amount payable by way of insertion upon money
borrowed by any person where the Commissioner General is satisfied
that the loan or advance was obtained for capital employed wholly and
exclusively for business purposes or in the production of income, a
deduction shall be allowed.
(2) Only one deduction is allowed under this Act in respect of the same
matter in any charge year.
(As amended by Act No. 26 of 1970 and No. 3 0f 2003)
29A. (1) Notwithstanding the provisions of section twenty-nine or any
other provisions of this Act, any foreign currency exchange gains or
losses, other than those of a capital nature, shall be assessable or
deductible, as the case may be, in the charge year in which such gains or
losses are realised, that is to say, in the charge year in which the person
or partnership concerned is required to pay the additional kwacha or is
allowed a rebate or a reduction in settlement of a foreign of a foreign
debt or liability.
Foreign currency
exchange gains and
losses
Provided that foreign exchange losses of a capital nature incurred on
borrowing used for the building and construction of an industrial or
commercial building shall be deductable.
(2) Subsection (1) shall not apply in case of a bank.
Provided that any foreign currency exchange gains or losses of a bank of
a capital nature shall not be assessable or deductible as the case may be
in the charge year in which they are translated.
(3) Where the accounts of a bank made up for the bank's accounting
period ending in the charge year ending 31st March, 1999 recognise any
foreign currency exchange gain or loss but that gain or loss is not
realised within the meaning of subsection (1) in that charge year, then
the amount of that gain or loss shall be deemed to be a gain or loss of the
business carried on by the bank assessable or deductible, as the case may
be, in the charge year ending 31st March, 2000.
(4) In this section “industrial building” and “commercial building” have
the meaning assigned to them in the fifteen schedule.
(As amended by Act No. 14 of 1987, Act No.6 of 1999, Act No.6 of 2000,
No.3 of 2002 and No. 3 0f 2003)
30. (1) Subject to the other provisions of this section, any loss incurred
in a charge year on a source by a person, shall be deducted only from the
income of the person from the same source as that in which the loss was
incurred.
Losses
(2) Subject to the other provisions of this section, where a loss referred
to in subsection (1) exceeds the income of a person for the charge year in
which the loss was incurred, the excess shall, as far as possible, be
deducted from the income of the person from the same source as that in
which the loss was incurred for the following charge year;
Provided that:
(i) in the case of any loss incurred by any mining company holding a
large-scale, minig licence issued under section twenty-three of the
Mines and Minerals Act and carrying on the mining of base metals, the
loss shall not be carried forward beyond ten subsequent years after the
charge year in which the loss was incurred;
Cap. 13
(ii) in any other case, the loss shall not be carried forward beyond five
subsequent years after the charge year in which the loss was incurred;
and
(iii) losses brought forward as at 31st March, 1997, shall be deemed to
have been incurred in the charge year ending 31st March, 1997
(3) Where on the death of an individual his interest in a business passes
to his spouse, any undeducted loss attributable to such interest shall be
deducted from the spouse's income from that business in accordance
with the provisions of sub-section (2).
(4) Repealed by Act No. 7 of 1996.
No. 7 of 1996, No. 3 of 1997, No.9 of 1998, No. 4 of 2000 and No. 7 of 2006)
30A. (1) The losses to be deducted by any mining company holding a
large-scale mining licence pursuant to section twenty-three of the Mines
and Minerals Act and carrying on the mining of base metals shall be
indexed losses.
(2) For the purposes of this section indexed losses shall be computed as
follows:
[1 + (R²R¹) ] x loss brought forward
R¹
Where:
R¹ is the Kwacha against the United States Dollar at the exchange rate
ruling on the last day of the preceding accounting year in which the loss
is being claimed; and
R² is the Kwacha against the United States Dollar exchange rate to be
used for this purpose on the last day of the accounting year in which the
loss is being claimed.
The Kwacha against the United States Dollar exchange rate to be used
for this purpose is the Bank of Zambia mid-rate at the end of the
accounting period.
Indexation of
losses
Cap 213
31. If a company has incurred a loss on a source for the purposes of this
Act and that company in this section called the old company)-
(a) was incorporated outside the Republic; and
(b) carried on its principal business within the Republic; and
(c) is about to be wound up voluntarily in its country of incorporation for
the purposes of transferring the whole of its business and property
Transfer of losses
wherever situate, to a company which has been or will be incorporated
in the Republic (in this section called the new company) for the
purposes of acquiring that trade and property and the only consideration
for the transfer will be the issue to the members of the old company of
shares in the new company in proportion to their shareholdings in the
old company;
the new company after the transfer referred to in paragraph (c) shall be
allowed the old company's loss as deduction from income from the same
source as that in which the old company's loss was incurred to the extent
that the loss has not been allowed as a deduction under this Act for any
charge year and such loss shall be allowed in accordance with the
provisions of section thirty.
Provided that the combined period of loss carried forward for both the
old and new companies shall not exceed five years.
(As amended by Acts No. 14 of 1976, No. 14 of 1987 and
No. 3 of 1997)
32. (1) Subject to the provisions of subsection (2), no person may carry
forward any loss incurred before he had been adjudged bankrupt.
Losses prior to
bankruptcy, etc
(2) Where any person has made a conveyance or assignment of his
property for the benefit of his creditors, or has made an arrangement
with them, or has entered into a composition with them which has been
approved by the High Court pursuant to any Bankruptcy Act in force in
the Republic, whereby the said person is released from his debts or from
any proportion or part thereof, any loss incurred by him prior to his
making of such conveyance, or assignment, or arrangement, or his
entering into such composition, may be carried forward, reduced,
however, pro tanto, by the amount of the debts released by or under the
said conveyance, assignment, arrangement, or composition, as the case
may be, and such loss shall be allowed in accordance with the provisions
of section thirty.
33. (1) Capital allowances are deducted in ascertaining the gains or
profits of a business and the emoluments of any employment or office
for each charge year-
(a) for buildings, implements, machinery and plant, and premiums,
according to the provisions of Parts I to V inclusive of the Fifth
Schedule;
(b) for capital expenditure in relation to mining operations, according to
the provisions of Parts I to VI inclusive of the Fifth Schedule; and
(c) for farm improvements and works, according to the provisions of the
Capital allowances
Sixth Schedule.
(2) The capital allowances to be claimed by any mining company
holding a large-scale mining licence pursuant to section twenty-three of
the Mines and Minerals Act and carrying on the mining of base metals
shall be indexed capital allowances.
(3) For the purposes of this section indexed capital allowances shall be
computed as follows:
[1 + (R²R¹) ] x Capital allowance
R¹
Where:
R¹ is the Kwacha against the United States Dollar at the exchange rate
ruling on the last day of the preceding accounting year in which the loss
is being claimed; and
R² is the Kwacha against the United States Dollar at the exchange rate
ruling on the last day of the accounting year in which the loss is being
claimed.
The Kwacha against the United States Dollar exchange rate to be used
for this purposes is the Bank of Zambia mid-rate at the end of the
accounting period.
No. 46 of 1973, No. 11 of 1975, No. 3 of 1997 and No. 7 of 2006)
34. Where a person incurs capital expenditure on the construction of,
addition to, or alteration of any industrial building, as defined in
paragraph 1 of the Fifth Schedule, to be used by him for the purposes of
his business as a manufacturer, an investment allowance of ten per
centum of such expenditure shall be deducted in ascertaining the gains
or profits of that business for the year in which the said building,
addition or alteration is first used for the said purposes.
(As amended by Acts No. 11 of 1969, No. 26 of 1970, No. 11 of 1985 and
No. 14 of 1987 and No. 4 of 1993)
Investment
allowances
34A. (1) Where a person incurs expenditure on the growing of rose
flowers, tea, coffee, or banana plant or citrus fruit trees, or other similar
plants or trees, an allowance (in this Act referred to as a development
allowance) of ten per centum of such expenditure shall be deducted in
ascertaining the gains or profits of that business for the charge year.
Development
allowance
(2) The development allowance referred to in subsection (1) may, in the
case of a person growing for the first time plants or trees referred to
therein, be carried forward to the following charge years up to the first
year of production, but in no case shall the development allowance in
respect of more than three consecutive years be carried forward.
(As amended by Act No. 10 of 1981, No. 3 of 2002 and No. 3 of 2003)
35. A deduction is allowed in ascertaining the gains or profits of a
business for the charge year in which that business commences, in
respect of any expenditure that-
(a) was incurred within eighteen months before the commencement of
the business; and
(b) would have been allowed as a deduction in ascertaining the gains or
profits of the business after its commencement.
Preliminary business
expenses
36. Where any amount is paid by any person after the cessation of his
business which, if it had been paid prior to the cessation, would have
been deductible in computing his gains or profits from the business,
then, to the extent to which that amount has not already been deducted in
computing the gains or profits, it shall be deducted from his income for
the charge year in which it is paid or, if he has not income in that charge
year, from his income for the charge year in which the business ceased,
and such deduction shall be made before deductions under sections
thirty, thirty-one and thirty-two.
(As amended by Act No. 26 of 1970 and No. 4 of 2000)
Amount paid after
cessation of business
37. (1) (a) A deduction shall, subject to the provisions of this
subsection and subsection (4), be allowed in ascertaining the income
from emoluments of an employee for a charge year of any amount paid
by him during that charge year by way of contribution to any approved
fund including National Pension Scheme Authority if the fund to which
the contribution is made continues to be an approved fund for that
charge year:
Approved fund
deductions
Provided that no deduction shall be allowed under this paragraph in
respect of any contribution other than a contribution-
(i) which is not a contribution in arrear (hereinafter in this subsection
referred to as a current contribution); or
(ii) which is a special lump sum contribution allowed to be deducted
under and in accordance with paragraph (b).
(b) A contribution paid by an employee-
(i) in respect of services rendered by him whilst resident in the Republic
to his employer prior to the date of the employee becoming a member of
the approved fund to which the said contribution is paid; or
(ii) in respect of a period when the employee was resident and employed
in the Republic prior to the date of the employee becoming a member of
a fund within paragraph (c) of the definition of approved fund or a fund
approved under paragraph 5 of the Fourth Schedule to which the said
contribution is paid;
in order that the employee may qualify for benefits under the approved
fund to which the contribution is paid in respect of such prior services or
period as aforesaid shall be a special lump sum contribution and shall,
for the purposes of paragraph (a), be treated as a current contribution for
such charge year or as current contributions for such charge years and in
such amounts as the Commissioner-General, in his discretion, may
direct.
(c) The deduction to be allowed to an employee for a charge year in
respect of his current contributions to approved pension funds shall not
exceed-
(i) fifteen per centum of his income from emoluments liable to tax
which have been received for that charge year from any employer who
established, adhered to or continued the said approved pension fund, the
fifteen per centum to be calculated before any deduction under this
subsection; or
(ii) One hundred and eighty thousand kwacha whichever is the less.
(d) The total deductions to be allowed to an employee for a charge year
in respect of current contributions to an approved fund within the
meaning of paragraph (c) of the definition of approved fund and a fund
approved under paragraph 5 of the Fourth Schedule shall not exceed
fifteen per centum of the income from emoluments of the employee
liable to tax before allowing any deduction under this subsection for that
charge year or one hundred and eighty thousand kwacha, whichever is
the less.
(e) The total of the deductions to be allowed for a charge year under
paragraphs (c) and (d) shall not exceed fifteen per centum of the income
from emoluments of the employee liable to tax before allowing any
deduction under this subsection for that charge year or one hundred and
twenty thousand kwacha, whichever is the less, and in any case shall not
exceed the assessable income of the employee for the charge year before
allowing the deductions under this subsection, subsection (3) and
sections thirty, thirty-two, thirty-six, forty and forty-one.
(2) (a) A deduction shall, subject to the provisions of this subsection,
be allowed in ascertaining the gains or profits of an employer for a
charge year of any amount paid during that charge year by him by way
of contribution to an approved fund established for the benefit of his
employees (including an approved fund within the meaning of
paragraph (c) of the definition of approved fund and a fund approved
under paragraph 5 of the Fourth Schedule) if the fund to which the
contribution is made continues to be an approved fund for that charge
year:
Provided that no deduction shall be allowed under this paragraph in
respect of any contribution other than a contribution-
(i) which is not a contribution in arrear (hereinafter in this subsection
referred to as a current contribution); or
(ii) which is a special lump sum contribution which is allowed to be
deducted under and in accordance with paragraph (b).
(b) A contribution paid by an employer-
(i) in respect of services rendered to him by an employee prior to the
date of the employee becoming a member of the approved fund to which
the said contribution is paid in order that the employee may qualify for
benefits under that approved fund in respect of such prior services; or
(ii) for any other reason approved by the Commissioner-General;
shall be a special lump sum contribution and shall be treated as a current
contribution for such charge year or as current contributions for such
charge years and in such amounts as the Commissioner-General, in his
discretion, may direct.
(c) The deduction to be allowed for a charge year in respect of current
contributions to an approved fund other than a fund approved under
subsection (1) of section eleven of the former Act shall not exceed
twenty per centum of the emoluments liable to tax received from the
employer in that charge year by each employee in respect of whom the
contributions are paid.
(3) (a) A deduction shall, subject to the provisions of this subsection
and subsection (4), be allowed from the income of an individual for a
charge year of any amount paid by him during that charge year by way
of a premium payable under an approved annuity contract if the pension
fund to which the contribution is paid or the annuity contract under
which the premium is paid continues to be an approved fund for that
charge year and such deduction shall be deducted from the income of an
individual before deductions under sections thirty, thirty-two, thirty-six,
forty, and forty-one.
(b) The deduction to be allowed for a charge year under this subsection
shall not exceed one hundred and twenty thousand kwacha or the
assessable income of the individual for the charge year before allowing
the deduction under this subsection and deductions under sections thirty,
thirty-two, thirty-six, forty and forty-one, whichever is the less, except
that in the case of an individual who is not resident in the Republic, the
deduction shall not exceed an amount equal to the contribution or
premium paid as aforesaid multiplied by the fraction of his assessable
income as above over his world income.
(3A) For the purposes of subsection (3) "world income" in relation to
any person means the total amount of that person's income from all
sources, excluding the income which is chargeable to tax but which the
Commissioner-General is precluded from including in an assessment,
the amount of income from each source being substantiated to the
satisfaction of the Commissioner-General;
(4) The total of all deductions to be allowed to an individual under
subsection (1) and (3) for a charge year shall not exceed one hundred
and eighty thousand kwacha or the assessable income of that individual
for that charge year before allowing the deductions under subsection (1)
and (3) and deductions under sections thirty, thirty-two, thirty-six, forty
and forty-one, whichever is the less.
(As amended by Acts No. 29 of 1970, No.12 of 1982,
No. 11 of 1984, No. 14 of 1987, No. 11 of 1992, No.4 of 1993,
No. 14 of 1994, No. 2 of 1995 and No. 7 of 1996, No.6 of 1999 and No. 1
of 2001)
37A. A deduction shall be allowed in ascertaining the gains or profits of
an employer for a charge year of any amount incurred by the employer
in the establishment or in the administration of an approved share option
scheme for that year
Deduction for
share option
scheme
38. A deduction shall be allowed in ascertaining the gains or profits of
a business for any payment made for the purposes of technical education
relating to that business or for the purposes of obtaining further
experience, training or qualifications, relating to that business:
Technical education
Provided that no deduction shall be allowed under this section in respect
of any payment made-
(a) on behalf of an individual who is related by blood or marriage to the
person making the payment, or to a person who is able to control
directly or indirectly the person making the payment;
(b) in pursuance of an agreement or undertaking to the effect that the
person making the payment will receive any reciprocal benefit for such
payment where made on behalf of an individual who is related by blood
or marriage to any other party to that agreement or undertaking.
39. A deduction is allowed in ascertaining the gains or profits of a
business or the emoluments of any employment or office for any
subscription paid by a person in respect of his membership of a trade,
technical or professional association which is related to his business,
employment or office.
Subscriptions
41. (1) Subject to the provisions of this section, any amount paid by a
person during a charge year to an ecclesiastical, charitable, research,
educational institution of a public character or to a national amateur
sporting association or to any fund of a public character wholly and
exclusively established for the use of the Republic or for ecclesiastical,
charitable, research, educational or amateur sporting purposes, shall be
deducted from the income of that person for that charge year if-
Charities
(a) the payments are in money or money's worth;
(b) the payments are made for no consideration whatsoever;
(c) the Minister approves the institution, association or fund to which
payment is made or to be made and the Minister may in like manner
withdraw such approval and such withdrawal may be made
retrospectively.
(2) The deduction to be allowed in a charge year under this section shall
be allowed before deductions under sections thirty, thirty-one,
thirty-two, thirty-six and forty, and in no case shall exceed fifteen per
centum of the assessable income of the person for the charge year.
No. 6 of 1980, No. 12 of 1982, No. 14 of 1987, No. 11 of 1992 and No. 7
of 1996)
43. (1) A deduction is allowed in ascertaining the gains or profits of a
business of any expenditure, not being expenditure of a capital nature,
incurred by the business during a charge year on experiments or
research relating to the business.
Deduction for
research
(2) A deduction is allowed in ascertaining the gains or profits of a
business for any contribution to a scientific or educational society or
institution or other like body of a public character approved by the
Commissioner-General where a condition of the contribution is that it
must be utilised by the society, institution or body, as the case may be,
solely for the purposes of industrial research or scientific experimental
work connected with the business.
43A. (1) A deduction shall be allowed in ascertaining the income from
any source for debts to the extent that the debts have been included in
the income from that source and to the extent that they are proved to the
satisfaction of the Commissioner-General to be bad or likely to become
bad and, where there is no income from that source for the charge year
for which such deduction is due that deduction shall be deemed to be a
loss under section thirty.
(2) Where a deduction has been allowed under subsection (1) in respect
of any debt, and in the subsequent charge year part or all the debt is
recovered, the amount of the recovery or, where less, the total
deductions allowed in one or more charge years in respect of that debt,
shall be assessable in the charge year in which the recovery is received:
Provided that where recoveries are effected in more than one charge
year, the total amount assessable in each charge year after the first such
charge year shall not exceed the amount of the recovery in that later year
or, where less, the total of the deductions previously allowed less any
recoveries assessable in previous charge years.
(3) Where a claim for a deduction is made under subsection (1) by a
bank, bank subsidiary or financial institution, subsection (1) shall apply
subject to the following:
(a) the words "to the extent that the debts have been included in the
income from that source" in that subsection shall not apply; and
(b) the maximum deduction for any debt falling within the
classifications set out by or under the Banking and Financial Services
Act shall not exceed the minimum level of provisioning for such a debt
required by the Bank of Zambia by or under the Banking and Financial
Services Act.
(As repealed and replaced by Act No.6 of 1999, amended by Act No. 4
of 2000 and No. 1 of 2001)
Deduction for bad
and doubtful debts
43B. (1) A deduction shall be allowed in ascertaining gains or profits of
a business of any mineral royalty payable and paid for a charge year in
pursuance of the provisions of section sixty-six of the Mines and
Minerals Act.
(2) This section shall not apply to any royalty payable and paid for any
charge year prior to the charge year ending 31st March 2000
Cap. 213
(Repealed by Act No. 17 of 1988 and replaced by Act No.6 of 1999).
43C. Repealed by Act No. 3 of 2002
8 of 1986, No. 14 of 1987, No. 33 of 1989, No. 11 of 1992 and No. 3 of
2002)
43D. (1) A deduction shall be allowed in ascertaining the gains or
profits of a business in respect of each person with disability who has
been employed full-time by such business for the whole or substantial
part of the charge year for which the deduction is claimed.
Deduction for
employing
handicapped person
(2) The amount of the deduction referred to in subsection (1) shall be
five hundred thousand kwacha.
(As amended by Act No. 11 of 1985, No. 4 of 1993, No. 7 of 1996 and
No. 3 of 2002)
43E. Repealed by Act No. 7 of 1996.
44. No deduction is made in respect of any of the following matters:
(a) the cost incurred by an individual in the maintenance of himself, his
family or establishment, or which is a domestic or personal expense.
(b) any loss or expense which is recoverable under any insurance
contract or indemnity;
(c) capital expenditure or loss of capital, other than loss of stock in trade,
unless specifically permitted under this Act;
(d) any payment to a pension or superannuation fund or scheme or
premium payable under an annuity contract, except such payments as
are allowed under section thirty-seven;
(e) any tax or penalty chargeable under this Act;
(f) Repealed by Act No. 9 of 1998;
Case of no deduction
(g) any amount which would be deductible in ascertaining the income
from a source or from income which the Commissioner-General is
prohibited from including in any assessment under the provisos to
subsection (1) of section sixty-three;
(h) any expenditure incurred or capital asset employed, whether directly
or indirectly, in the provision of entertainment, hospitality or gifts of any
kind:
Provided that this paragraph shall not apply to-
(i) any expenditure incurred or capital asset employed in the provision
of anything which it is the purpose of a person's business to provide and
which is provided in the ordinary course of that business for payment or
for the purpose of advertising to the public generally without payment;
(ii) Repealed by Act No. 11 of 1992;
(iii) any expenditure incurred in the provision of a gift to any person
consisting of an article incorporating a conspicuous advertisement for
the donor the cost of which to the donor, taken together with the cost to
him of any other such articles given by him to that person in the same
charge year, does not exceed K25,000.00;
(i) any amount incurred by the employer in the establishment or
administration of a share option scheme, except such amounts as are
allowed under section thirty-seven A.
(j) Repealed by Act No. 3 of 1997;
(k) Repealed by Act No. 4 of 1993;
(l) the cost of any benefit or advantage not capable of being turned into
money or money's worth that is provided to employees, subject to such
directions as shall be issued by the Commissioner-General; and
(m) any copper price participation payment or cobalt price participation
payment:
Provided that a deduction shall be allowed to Konkola Copper Mines
Plc and Mopani Mines Plc in respect of any payments made pursuant to
cobalt price participation and copper price participation agreements
between Konkola Copper Mines Plc or Mopani Copper Mines Plc and
Zambia Consolidated Copper Mines Limited:
(n) incidental costs of obtaining finance such as commitment and
guarantee fees, commissions and any other incidental cost of a similar
nature; and
(o) any levy payable under the Medical Levy Act.
(As amended by Acts No. 26 and 27 of 1970, No. 17 of 1971,
No. 11 of 1973, No. 11 of 1975, No. 14 of 1976, No. 10 of 1981, No. 14 of
1987, No. 11 of 1992, No. 4 of 1993, No. 2 of 1995, No. 3 of 1997, No. 1
of 1997, No.9 of 1998, No. 4 of 2000, No. 3 of 2002, No. 3 of 2003 and
Act No. 1 of 2005)
Act No. of 2003
PART V
RETURNS AND ASSESSMENTS
45. Every person within thirty days from first receiving income liable
to tax under this Act shall give written notice accordingly to the
Notice to
Commissioner-General
45A. (1) Every person shall provide his taxpayer identification
number with all forms, notices, certificates, documents, and other
communications submitted to the Commissioner-General under this
Act.
Duty to provide
taxpayer identification
number
(2) Any person carrying on any business in partnership shall provide
the taxpayer identification number of every partner with all
documents, forms, notices, certificates, and other communications
submitted to the Commissioner-General under this Act.
(3) Every person making payments for which it is required to submit
to the Commissioner-General a return, notice, form, certificate, or
other such document under sections fifty, fifty-two, seventy-one, eighty,
eighty-one, eighty-one A, eighty-two, or ninety-five D of this Act shall
furnish to the Commissioner-General on or along with that document
the taxpayer identification numbers for all persons to whom the
payments have been made.
(4) This section shall have effect irrespective of the charge year to
which the forms, notices, certificates, documents and other
communications referred to in subsection (1) to (3) pertain.
45B. (1) The institutions listed in column 1 of this subsection shall
require a tax payer identification number from any person, applying for
anything listed, or engaged in the types of transactions listed,
whichever is applicable, in column 2 of this section.
Column 1 Column 2
Institution Type of Transaction
Commissioner of Lands Registration of titles
Registrar of Motor Vehicles Registration and transfer of motor
vehicles
Ministry of Commerce Import licensing and trade
licensing
Tax payer
identification number
required for certain
transactions
Zambia Electricity Supply Payment of deposit for power
Corporation connection
Registrar of Companies and Registration of Companies and
Business Names business names
(2) Each institution listed in column 1 of subsection (1) shall avail the
Commissioner-General or his authorised agent access to the
documents, forms, notices, certificates, and other communications in
which a tax-payer identification number is required to be used under
subsection (1):
Provided that such access shall be as is necessary to assist in the
enforcement of the tax laws.
(3) Any person, including a person carrying on any business in
partnership, who is required under subsection (1) to furnish a tax-payer
identification number and who furnishes a false number shall be guilty
of an offence under this Act.
(As amended by Act No. 4 of 1993 and No.9 of 1998)
46. (1) Every person liable to tax for any charge year, other than an
individual whose income consists entirely of emoluments within the
provisions of Part VI (which relates to Pay As You Earn), shall furnish
to the Commissioner-General a return of income and such particulars
as may be required for the purposes of ascertaining the income
chargeable, if any, and the tax liability due, if any under this Act.
Returns generally
(2) The return required under this section shall-
(a) contain a statement of the person's income liable to tax, including
income deemed under this Act to be the income of the person in respect
of whom the return is submitted but excludingany income which
cannot be assessed by virtue of the proviso to subsection (1) of section
sixty-three;
(b) contain a computation, by or on behalf of the person liable to tax, of
the amount of tax due based on rates of tax applicable for such charge
year and, in the case of an individual, any deductions, and tax credit to
which he is entitled;
(c) include a declaration by such person, or by the person in whose
name he is assessable, that such return includes a full statement of
income liable to tax and a proper computation of tax due for such
charge year; and
(d) be designated in kwacha.
(3) The return referred to in subsection (1) shall be furnished to the
Commissioner-General not later than 30th September following the
end of the charge year.
(4) Where a person fails to submit a return on, or before, the date
provided under subsection (3), there shall be charged a penalty of-
(a) in the case of an individual, one thousand penalty units per month
or part thereof; or
(b) in the case of a company, two thousand penalty units per month or
part thereof:
Provided that the Commissioner-General may in his discretion remit
the whole or part of any such penalty.
No. 2 of 1995, No. 3 of 1997, No.9 of 1998, No. 3 of 2002 and No. 1 of
2005)
46A. (1) Without prejudice to the requirement under section forty-six,
every person, including an individual whose income consists entirely
of emoluments within the provisions of Part VI which relates to (Pay
As You Earn), shall submit in accordance with this section a return of
provisional income tax for any charge year:
Provisional Income tax
Provided that an individual who does not expect to receive assessable
income (other than emoluments within the provisions of Part VI) in
excess of one million eight hundred thousand kwacha for such charge
year need not submit such return.
(2) The return of provisional income required under this section shall-
(a) contain an estimate (based on information reasonably believed to
be true) of the person's income liable to tax, including income deemed
under this Act to be the income of the person in respect of whom the
return is submitted but excluding any income which cannot be assessed
by virtue of the proviso to subsection (1) of section sixty-three;
(b) contain a computation of tax based on rates of tax applicable for
such charge year and, in the case of an individual, deducting any tax
credit to which the individual is entitled, and any such computation
shall exclude tax on income falling within Part VI (Pay As You Earn)
and any tax deducted from any other income;
(c) include a declaration by such person or by the person in whose
name he is assessable, that such provisional return includes a full and
reasonable estimate of his income for such charge year;
(d) be designated in kwacha.
(3) The return of provisional income referred to in subsection (2) shall
be furnished not later than the 30th June of the charge year to which
such return relates.
Provided that where during the course of the charge year, any person
discovers that the return of provisional income furnished under this
section is likely to be substantially incorrect because of changed
circumstances, such person shall furnish a revised return of revised
provisional income and in such a case, any alteration in the amount of
estimated tax payable shall be taken into account in the next instalment
(pursuant to section seventy-seven) immediately following the date of
such revised return;
(4) Where an individual is not required to make a return of provisional
income and tax for any charge year by virtue of the proviso to
subsection (1) but at a time subsequent to 30th June in that year that
proviso ceases to apply to the individual, that individual shall make a
return in accordance with subsections (1) and (2) within fourteen days
of the proviso ceasing to apply to that individual.
(5) Where, upon the receipt of a return of income pursuant to section
forty-six, it is discovered that income has been so underestimated that
the tax on such estimate has been underpaid by at least one-third, then
such person shall be liable to a penalty under this section calculated at
the rate of twenty-five percent of the tax which has been underpaid;
(6) In this Act any reference to a person's provisional income for any
charge year is a reference to the estimate calculated in accordance with
paragraph (a) of subsection (2) of that person's income for that charge
year.
(7) In this Act any reference to any provisional tax which a person is
liable to pay during any charge year is a reference to the estimate
calculated in accordance with paragraph (b) of subsection (2) of that
person's tax liability for that charge year.
(8) Where a person fails to submit a return or a revised return in
accordance with this section, there shall be charged a penalty of-
(a) in the case of an individual, one thousand penalty units per month
or part thereof during which such failure continues; or
(b) in the case of a company, two thousand penalty units per month or
part thereof during which such failure continues:
Provided that the Commissioner-General may remit the whole or part
of any such penalty.
(9) Any reference to tax in subsection (7) of section seventy-eighty, and
in sections seventy-eight A, seventy-nine, seventy-nine A, seventy-nine
B, seven-nine C, seventy-nine D, eighty-three, eighty-four, eighty-six,
eighty-seven, and ninety-two includes a reference to provisional tax.
(As amended by Act No.6 of 1999, Act No.4 of 2000, No.1 of 2001, No.
3 of 2002 and No. 1 of 2005)
46B. (1) Where any person has, for any year, failed to submit a return
or revised return under section forty-six A the Commissioner-General
may-
(a) estimate such person's income chargeable to tax, in accordance with
paragraph (a) of subsection (2) of section forty-six A; and
(b) compute the provisional liability to tax of that person on that
estimated income in accordance with paragraph (b) of subsection
(2) of section forty-six A; and shall serve notice on that person
specifying the amount of income so estimated and the provisional
tax liability so computed.
(2) Subject to subsections (1) and (3) of section forty-six A a notice
served on any person under subsection (1) shall, for the purposes of
this Act, be deemed to be a return of provisional income and tax made
by that person, and a person is not relieved of any obligation to make
any return of provisional income or tax or from any penalties for
failure to make such a return under section forty-six A.
(3) Where a person who has been served with a notice under this
section makes a return under section forty-six A which, apart from the
date on which the return is made, complies with the requirements of
that section, the notice under this section shall cease to have effect.
No. 11 of 1992, No. 2 of 1995, No. 7 of 1996, No.9 of 1998, No. 4 of
2000,and No. 1 of 2001)
Estimated
provisional tax
returns
47. (1) The Commissioner-General may, by notice in writing require
any person to furnish him, within a reasonable time specified in the
notice, with further returns or particulars in relation to any matter
contained in a return made under this Act or in relation to any
transactions or matters appearing to the Commissioner-General to be
relevant to the ascertainment of the income of that person.
Further provisions as to
returns
(2) The Commissioner-General may determine that any person shall
make a return on another person's behalf, and any such return is the
return of that other person for the purposes of this Act, save that the
operation of this subsection shall not relieve that other person of any
liability under this Act.
(3) Any person preparing, signing or rendering any return or statement
for the purposes of this Act is deemed to be aware of the contents of
that return or statement.
(As amended by Act No.6 of 1999)
48. Every person shall furnish to the Commissioner-General such
information, whether relating to the affairs of himself or any other
person, as the Commissioner-General determines is necessary for the
purposes of this Act, and every provision of this Act relating to the
delivery of information to the Commissioner-General is without
prejudice to the generality of this section.
Information generally
49. The Commissioner-General may give notice in writing to any
person requiring him to furnish within the time limited by such notice,
not being less than thirty days from the date of service of such notice, a
statement in writing containing particulars of-
(a) all banking accounts, whether current or deposit business or
private, in his own name or in the name or names of his wife or wives,
or in any other name, in which he is or has been interested, or on which
he has or has had power to operate, jointly or solely, and which are in
existence or which have existed at any time during the period stated in
the notice;
(b) all savings and loan accounts, deposits, building society, and
cooperative society accounts, in regard to which he has, or has held,
any interest or power to operate jointly or solely during the period
aforesaid;
(c) all assets, other than those referred to in paragraph (a) or (b) which
he and his wife or wives possess, or have possessed, during the period
aforesaid;
(d) all sources of income not referred to in paragraph (a), (b) or (c) and
the income derived therefrom; and
(e) all facts bearing upon his liability to income tax to which he is or
has been liable.
Statement of bank
accounts, assets, etc.
50. The Commissioner-General may by notice in writing require any
person whose business is to provide living accommodation to deliver a
list of all persons he has so accommodated.
Return of lodgers and
inmates
51. Whenever so required by the Commissioner-General, and in the
prescribed form, everyone carrying on business shall deliver returns
showing-
(a) particulars of all payments in respect of any share or interest in the
Information as to
business matters
business;
(b) particulars of all moneys received by him on deposit;
(c) particulars of any interest received or paid by him;
and
(d) such other information as may be in his possession relating to the
income received by any other person.
53. Notwithstanding anything to the contrary in any written law, any
officer in the service of the Government, a local authority or public
body who has charge of documents or electronically stored data which
might aid the carrying out of the provisions of this Act shall permit the
Commissioner-General or the Commissioner-General's authorised
officer to inspect and copy those documents or electronically stored
data, and have custody of such of them as are necessary for production
in proceedings.
Public documents
54. Every resident company shall deliver to the Commissioner-General
a copy of its memorandum and articles of association, and copies of all
amendments thereto, and, if the Commissioner-General so determines,
all such particulars relating to the company's affairs and shareholders
as the Commissioner-General may in writing require.
Information as to
companies
55. (1) Every person carrying on a business shall keep, in the English
language, books and accounts of all his transactions, and, unless
otherwise authorised by the Commissioner-General, shall retain for six
years from the date of the last entry all documents relating to any
business carried on by him, or otherwise recording the details from
which his returns for the purposes of this Act were prepared.
Accounts and records
(2) A person who retains, in accordance with conditions specified by
the Commissioner-General, photographic reproductions of the
documents referred to in subsection (1) is deemed to retain those
documents for the purposes of that subsection.
(3) A person carrying out any mining operations may elect to keep
books of accounts in United States Dollars of all transactions relating
to, connected with, or incidental to, such operations if the
Commissioner-General is satisfied that not less than seventy-five per
centum of that person's gross income from mining operations is earned
in the form of foreign exchange from outside the Republic.
Provided that such election shall not be reversed without the consent of
the Commissioner-General.
56. (1) Notwithstanding the provisions of subsection (3) of section
fifty-five every return furnished under subsection (1) of section
forty-six by any person shall be accompanied by such accounts and
other documents, in kwacha, as are necessary to support the return and
shall be signed by the person furnishing the return.
Documents in support
of returns
(2) Where such accounts were audited by a person in a professional
capacity or where such accounts were not so audited but were prepared
by a person in a professional capacity, that auditor or person shall
furnish a certificate signed by him stating-
(a) the nature of the books of account and other documents from which
such accounts were prepared;
(b) the extent of his verification of the books of account and other
documents produced to him;
(c) whether and to what extent, if any, there are included any estimated
amounts or balancing adjustments;
(d) whether and subject to what reservations, if any, he considers that
such accounts present a true and fair view of the gains or profits from
such business for the period and the state of business at the end of the
period; and
(e) the capacity in which he signs the certificate;
and such certificate shall accompany the return.
(3) Where a person furnishes a return supported by accounts and such
accounts were not audited or prepared by a person referred to in
subsection (2), then he shall furnish a certificate signed by himself
stating-
(a) the nature of the books from which such accounts were prepared;
(b) whether and to what extent, if any, there are included any
estimated amounts or balancing adjustments;
(c) whether such accounts include all the transactions of his business
and present a true and fair view of the gains or profits from such
business for such period.
(4) In this section, "accounts" means a balance sheet or statement of
assets and liabilities together with a trading account, profit and loss
account or an income and expenditure account or other similar
statement, however named.
(5) For the purposes of this section, "person in a professional
capacity" shall mean an individual carrying on the profession of
accountant or auditor or one who prepares accounts for reward or in
the course of his business, either on his own or in partnership or as an
employee.
57. Where the Commissioner-General determines that any person is
able to impart information necessary for the purposes of this Act, the
Commissioner-General may, on reasonable notice to that person,
require him to attend to be examined at the time and place specified in
the notice.
Examination by
Commissioner-General
58. For the purpose of obtaining full information in respect of the
income of any person or class of persons, the Commissioner-General
may, by notice in writing, require, in the case of the income of any
person, that person or any other person, and in the case of any class of
persons, any person-
(a) to produce for examination by the Commissioner-General, at such
time and place as may be specified in such notice, any accounts,
books of account and other documents or electronically stored data
which the Commissioner-General may consider necessary;
(b) to produce forthwith for retention by the Commissioner-General
for such period as may be reasonable for their examination any
accounts, books of account and other documents or electronically
stored data which the Commissioner-General may specify in such
notice;
(c) not to destroy, damage or deface, on or after service of such notice,
any of the accounts, books of account and other documents or
electronically stored data so specified without permission of the
Commissioner-General in writing.
Production and
preservation of books
and documents
60. (1) The amount of income received from which tax is deductible
under sections eighty-one, eighty-one A, eighty-two or eighty-two A or
on which tax is payable under section eightyone shall be the gross
amount before deduction or payment:
Amount of dividends,
interest or royalties to be
included in income
Provided that the amount of income received by way of dividends
from which tax has been deducted in accordance with the direction of
the Commissioner-General made pursuant to the provisions of
paragraph (a) of subsection (1) of section eighty-one shall be the
amount that would have been received if tax had been deducted at the
rate that would have been deductible but for the direction.
(2) The amount of income received from a source outside the
Republic (in this section called foreign income) shall be the gross
amount of that income before the deduction of the amount of the
foreign tax.
(3) The amount of the income received by a beneficiary from a trust
or deceased's estate on which tax has been paid or is payable by the
trust or deceased's estate shall be the gross amount of that income
before deduction of tax at the rate paid or payable on that income by
the trust or deceased's estate.
(4) In this section, "foreign tax" has the same meaning as in section
seventy-five or seventy-six, as the case may require.
No. 11 of 1974, No. 9 of 1977 and No. 9 of 1978)
61. Persons carrying on any business in partnership shall furnish a
joint return of the income of the partnership for a charge year
declaring therein the names and addresses of all the partners and the
amount of the share of the income to which each partner is entitled for
that year, together with such other particulars as the
Commissioner-General may, in writing, require.
Partnership returns
62. (1) Where the accounts of the business of any person or
partnership are made up for a period of twelve months ending on
some date other than the last day of the charge year, the
Commissioner-General may in his discretion accept such accounts for
the purposes of determining the gains or profits of the business in
respect of the charge year ending either before or after the closing
date of such accounts, and the Commissioner-General may for the
purposes of this subsection accept accounts for a period less than
twelve months as though the accounts had been made up for a period
of twelve months.
Business accounts
(2) Where the Commissioner-General accepts the accounts of the
business of a person or a partnership pursuant to subsection (1), the
accounts of that business shall for the purposes of this Act be made up
subject to subsection (3) for all subsequent charge years to the date
corresponding in subsequent charge years to the date so accepted.
(3) Where the accounts of the business of a person or partnership are
not made up in respect of a subsequent charge year to the date in that
year corresponding to the date so accepted, then the income of the
business for that subsequent charge year and the preceding year may
be computed or adjusted, as the Commissioner-General, in his
discretion, may decide.
(3A) Where a company makes up the accounts of its business for a
period in this section referred to as "the accounting period" ending on
a date other than 31st March and such accounts are or will be accepted
by the Commissioner-General for the purpose of determining the
gains or profits of the business in respect of a charge year, in
accordance with the provisions of this section and that company is
required by any provision of this Act to submit a return of income,
including a return of provisional income and tax, for that charge year,
that return shall be of income, or provisional income, for the
accounting period for which relevant accounts are or will be made up.
(3B) For purposes of subsection (3A) "relevant accounts" in relation
to any charge year means the accounts wich are or will be submitted
to the Commissioner-General for the purpose of determining the
gains or profits of the business in question in respect of that charge
year.
(4) Where the Commissioner-General has accepted the accounts of
the business of a person or partnership pursuant to subsection (1), and
the business ceases, that person or partnership shall return for
assessment accounts to include all income of the business in the
period between the closing date of the last accounts so accepted for
the immediately preceding charge year and the date when the business
ceased.
(5) Where the period referred to in subsection (4) exceeds twelve
months, separate accounts shall be delivered for the period of twelve
months ending on the date accepted under subsection (1) as the
closing date of the accounts of the business, and for the balance of the
period in excess of twelve months.
(6) The income determined on the basis of the accounts referred to in
subsections (4) and (5) is charged to tax as follows:
(a) where the period is in excess of twelve months, the income
determined on the basis of the accounts delivered for twelve months,
as required under subsection (5), is deemed to be the income for the
charge year succeeding that in which the income based on the
accounts for the immediately preceding charge year was assessed, and
the income for the remaining period is deemed to be income of the
following charge year;
(b) where the period is one of less than twelve months, the income
based on the accounts delivered under subsection (4) is deemed to be
the income of the charge year succeeding that in which the income
based on the accounts for the immediately preceding year was
assessed.
(7) Notwithstanding subsection (6), where a person or partnership
has delivered accounts for the assessment of his business, and the
whole or part of the income determined on those accounts has been
charged to tax in more than one charge year, then when the business
ceases the income for the last charge year is reduced by an estimate
determined by the Commissioner-General of the income which has
been so charged to tax in more than one charge year, and if that
estimate exceeds the income for the last charge year, then the income
for the penultimate charge year shall be reduced by the amount of
such excess.
(8) For the purposes of this section, a person may be assessed in
respect of his income notwithstanding that he may not have been in
existence during any part of the relevant charge year.
62A. Where a person or partnership carries on in two consecutive
charge years a business of fishing or of farming, excluding the letting
of property for such purpose, and irrevocably so elects by notice in
writing to the Commissioner-General before the end of the charge
year immediately following the end of the second such consecutive
charge year, the income received from, or loss incurred in, such
business in each of the two charge years shall be averaged, and the
average income or loss shall be deemed to have been received or
incurred in each of the two said charge years:
Averaging of farming
and fishing income
Provided that there shall be no right of election under this section
where an election has already been made under this section in respect
of one or two consecutive charge years in respect of the same income
or loss.
63. (1) Subject to the provisions of subsection (1A) and sections
seventy-two and ninety-three, the Commissioner-General shall assess
every person who is liable to tax under this Act or who claims, or is
entitled to, a deduction under section thirty, thirty-one, thirty-two or
thirty-six:
Commissioner-General's
power to assess
Provided that the Commissioner-General shall take into account the
provisions of any agreement made under section seventy-four, if
applicable, and shall not include in any such assessment for any
charge year-
(i) dividends from which tax in respect of that charge year has been
deducted under section eighty-one;
(ii) a lump sum payment from which tax in respect of that charge year
has been deducted under section eighty-two;
(iii) Obsolete.
(iv) in the case of a person who is not resident in the Republic for any
charge year interest, public entertainment fee royalties or any
management or consultancy fee from which tax, in respect of that
charge year, has been deducted under section eighty-two A;
(v) in the case of a resident individual, interest from which tax in
respect of that charge year has been deducted under section
eighty-twoA; and
(vi) income of an individual from which tax in respect of that charge
year has been paid under section sixty-four A; and
(vii) in the case of a person exempted under subparagraph (1) of
paragraph 5 and subparagraph (1) of paragraph 6 of the Second
Schedule, interest from which tax in respect of that charge year has
been deducted under section eighty-two A.
(1A) In any case where a person has made payments of tax or
provisional tax in respect of any charge year under section forty-six
or forty-six A if the Commissioner-General is satisfied that the person
has no outstanding tax liability for that year, the
Commisssioner-General need not assess that person under this
section, unless the person makes a request in writing for an
assessment.
(1B) Where a person has made a return of tax under section forty-six
but is assessed under this section for any amount, the assessment shall
not relieve that person of any liability under section seventy-eight in
respect of any failure to make any payment of tax.
(1C) Where a person has made payments of tax or provisional tax for
a charge year but subsection (!A) does not apply, the
Commissioner-General shall make an assessment in respect of that
year and that person only for the amount by which the payments made
differ from the amount of tax due for that year.
(2) Subject to the provisions of subsection (1C), an assessment shall
be made in respect of every person for each charge year, and as many
amended assessments may be made in respect of such person for any
such charge year as are necessary to give effect to the provisions of
this Act, and whereby his liability to tax may be increased, reduced or
cancelled, as the circumstances require.
(3) Wherever for the purposes of this Act income is chargeable to tax
in any charge year following the charge year in which it is received,
the Commissioner-General may assess any person in respect of such
income at any time and may make such assessment at the current rate
of tax.
(4) The liability of any person to render a return or other information
required under this Act for any charge year is not relieved because he
is assessed for that charge year before such return or information is
rendered.
(As amended by Acts No. 23 of 1968, No. 26 of 1970, No. 17 of 1971,
No. 16 of 1972, No. 11 of 1973, No. 11 of 1974, No. 11 of 1975, No.
14 of 1976, No. 10 of 1979, No. 11 of 1984, No. 11 of 1985, No. 4 of
1993, No.9 of 1998, Act No.6 of 1999, No. 4 of 2000, No. 3 of 2002
and No. 3 of 2003)
64. An assessment may be made by the Commissioner-General in
any amount according to the best of his judgement in respect of any
person-
(a) who has not delivered a return as required by this Act, or on whose
behalf no return has been so delivered; or
(b) whose return does not satisfy the Commissioner-General;
(c) who the Commissioner-General has reason to believe is about to
leave the Republic:
Estimated assessments
Provided that-
(i) where the Commissioner-General does not have sufficient
information on which to estimate an assessment, the
Commissioner-General may assess a base tax of fifty thousand
kwacha in any charge year; and
(ii) a credit shall be allowed for the amount of any base tax which has
been paid in a charge year when establishing the amount of tax which
is due and payable resulting from any subsequent assessment which
the Commissioner-General may determine for the same charge year;
or
(d) where the Commissioner-General has reason to believe that the
company is to be wound up or liquidated.
(As amended by Act No. 14 of 1994, No. 3 of 1997, Act No.6 of 1999
and No. 3 of 2002)
64A. (1) The Commissioner-General may make a standard
assessment requiring any individual or partnership carrying on the
business of operating a public service vehicle for the carriage of
persons to pay a presumptive tax as set out in Part I of the Ninth
Schedule.
(2) The Commissioner-General may make a standard assessment
requiring any person carrying on any business, other than the business
referred to in subsection (1), with an annual turnover of two hundred
million kwacha or less to pay tax on turnover at the rate set out in Part
II of the Ninth Schedule;
Provided that the provisions of this subsection shall not apply to
income earned from the provision of consultancy services.
Standard Assessment
65. (1) Notice of assessment shall be given to the person charged. Assessment rules
(2) Save in case of fraud or wilful default or for the purposes of
section twenty-one, eighty-seven, eighty-eight, ninety-one or one
hundred and thirteen, or Part VII (which provides for double taxation
relief), or paragraph (25) of the Fifth Schedule, or granting tax credits
as provided in the Charging Schedule, no assessment shall be made
for any charge year after six years from the end of that year.
(3) No assessment shall be made in respect of the income of any
deceased person after the expiry of three years after the end of the
charge year in which such deceased person died.
(4) An assessment made in accordance with generally prevailing
practice is not affected by any change in that practice after the time for
objection to the assessment has expired.
and No. 7 of 1996)
66. (1) For the purposes of this Act, a taxpaying agent is, in relation
to income-
Taxpaying agents
(a) of a company, any of the individuals mentioned in subsection (1)
of section sixty-nine;
(b) managed by an agent, the agent;
(c) remitted by a person or partnership in the Republic to a person
who or partnership which is outside the Republic, the person or
partnership remitting the income;
(d) of a trust, a trustee of the trust;
(e) of a person who has died, his executor or administrator;
(f) of a deceased's estate, the executor or administrator of the deceased
person's estate;
(g) of a bankrupt's estate, the trustee in bankruptcy;
(h) of an incapacitated person, his trustee, guardian, curator,
committee or receiver appointed by a court, as the circumstances of
the case may require;
(i) of a company which is being wound up or is under judicial
management, the liquidator or judicial manager.
(2) No provision concerning a taxpaying agent shall relieve any other
person of any liability under this Act.
(3) Every reference in this Act to a taxpaying agent is to him only as
such, save where otherwise provided.
67. (1) Every taxpaying agent, in respect of the income which he
receives as an agent, shall be subject in all respects to the same duties,
responsibilities and liabilities as if that income were received by him
beneficially and is assessed and charged in his own name in respect of
that income, but any such assessment is deemed to be made upon him
as an agent.
Assessment of taxpaying
agent
(2) Any tax credits or deduction which might have been claimed by a
person is allowed in the assessment made upon his taxpaying agent as
such an agent.
68. Every taxpaying agent who pays tax in respect of income
assessed on him is entitled to recover the amount or that tax from the
person on whose behalf the tax is paid or retain out of any moneys that
are or may come into his possession on behalf of that person so much
as is necessary to indemnify him for the payment.
Right of taxpaying agent
69. (1) Where a company carries on business or has a place of
business in the Republic, a director, the secretary or any individual
concerned or appearing to be concerned in the management of the
company's business, is that company's taxpaying agent (and where a
Company's taxpaying
agent
company is being wound up or liquidated, the liquidator, receiver or
manager of the company, is that company's taxpaying agent) and with
necessary modifications the provisions of this Part relating to
taxpaying agents apply accordingly.
(2) The Commissioner-General may require a company's taxpaying
agent to answer for all such acts and matters as the company might be
required to answer for under this Act, and, if the company's taxpaying
agent defaults in this requirement, he is liable to such penalties as are
provided for by this Act in the case of like default by an individual.
70. No assessment, document or proceeding under this Act is
invalid-
(a) for any error in a person's name, if the erroneous name is or may
be understood to be that person's name, or the person has at any time
been known by the erroneous name, or one like it; or
(b) for any other error or defect, if the assessment, document or
proceeding is in substance in accordance with this Act.
Errors in form
PART VI
PAY AS YOU EARN
71. (1) On the making of any payment of, or on account of, any
emolument, tax shall, subject to and in accordance with regulations
made by the Minister, be deducted or repaid by the person or partnership
making the payment, notwithstanding that when the payment is made no
assessment has been made in respect of the emoluments, and
notwithstanding that the emoluments are in whole or in part emoluments
for some charge year other than the year during which the payment is
made, and, for the purposes of this subsection, payment shall be deemed
to be made when the emolument is received as provided in section five:
Assessment, charge,
collection and
recovery
Provided that with reference to paragraph (1) of section forty-four the
requirements of this subsection shall not apply to emoluments provided
to employees in the form of non-money fringe benefits.
(2) Tax deducted, as reduced by any tax refunded, under subsection (1),
shall be payable to the Commissioner-General on the dates prescribed
by the regulations made in accordance with subsection (6).
(3) Where the tax payable in accordance with subsection (2) is not paid
by the prescribed date, a penalty equal to five per centum of the amount
of tax payable but not paid shall be chargeable thereto for each calendar
month or part thereof for which, and to the extent that, such tax remains
unpaid, and for the purpose of any regulations relating to collection and
recovery of tax deducted under subsection (1), such penalty shall be
deemed to be tax deducted.
(4) Repealed by Act No.9 of 1998
(5) The Commissioner-General may, in his discretion, remit the whole
or any part of the penalty due under subsection (3).
(6) The Minister shall make regulations for the administration of this
Part, and for the assessment, charge, collection and recovery of tax in
respect of emoluments accordingly, and such regulations shall have
effect notwithstanding anything in this Act.
(6A) Regulations under this section may create offences punishable
with a fine not exceeding ten thounsand penalty units for any failure to
comply with the provsions of the regulations, other than a failure to
which subsection (3) applies.
(7) The Commissioner-General shall devise tax tables to ensure, so far
as possible, that-
(a) the total tax payable in respect of any emoluments for any charge
year is deducted from the emoluments paid during the year; and
(b) the tax deductible or repayable on the occasion of any payment of, or
on account of, emoluments is such that the total net tax deducted since
the beginning of the charge year bears to the total tax payable for the
year the same proportion that the part of the year which ends with the
date of the payment bears to the whole year.
(8) In subsection (6), the references to the total tax payable for the year
shall be construed as references to the total tax estimated to be payable
for the year in respect of the emoluments, subject to a provisional
allowance for deductions and tax credit and subject also, if necessary to
an adjustment for amounts overpaid or remaining unpaid on account of
tax in respect of emoluments to which this section applies for any
previous year.
(9) In estimating the total tax payable, it may be assumed, in relation to
any payment of, or on account of, emoluments, that the emoluments
paid in the part of the charge year which ends with the making of the
payment will bear to the emoluments for the whole of that year the same
proportion that part of the year bears to the whole year.
(10) For the purposes of this section emoluments shall include any
annuity or part thereof as is not exempt from tax under paragraph 10 of
the Second Schedule.
No. 11 of 1975, No. 11 of 1992, No.9 of 1998 and Act No.6 of 1999).
72. (1) Subject to the provisions of this section, no assessment need be
made on an individual in respect of his emoluments for any charge year
if the total net tax deducted in the year in question from his emoluments
is the same as it would have been if all the relevant circumstances had
been known to all parties throughout the year, and deductions and
repayments had, throughout the year, been made accordingly, and had
been so made by reference to cumulative tax tables.
Assessments not
always necessary
(2) In subsection (1)-
(a) "cumulative tax tables" means tax tables devised under the last
preceding section so as to require the tax to be deducted or repaid on
each payment in the year to be ascertained by reference to a total of
emoluments paid in the year up to the time of making that payment; and
(b) references to the total net tax deducted shall be construed as
references to the total tax deducted during the year by virtue of
regulations made under the last preceding section, less any tax repaid by
virtue of any such regulations.
(3) Nothing in this section shall be construed as preventing an
assessment being made on an individual in respect of his emoluments
and, without prejudice to this generality, an assessment shall be made in
respect of an individual's emoluments for any charge year if-
(a) the individual assessable, by notice in writing given to the
Commissioner-General within five years from the end of the charge
year, so demands; or
(b) the Commissioner-General so elects.
(4) In any proceedings in regard to an assessment made under
subsection (3), that assessment shall be treated as having been made in
accordance with the practice generally prevailing at the end of the year
to which the assessment relates.
73. In the distribution of the property of a bankrupt and in the
distribution of the assets of any company being wound up, any sums due
on account of tax deducted under this Part shall be paid as if such sums
were tax within the meaning of section three (d) of the Preferential
Priority on
insolvency
Cap. 83
Claims in Bankruptcy Act, or the corresponding provision of any Act
replacing that Act.
PART VII
DOUBLE TAXATION RELIEF
74. (1) The President may enter into an agreement, which may have
retrospective effect, with the government of any other country or
territory with a view to the prevention, mitigation or discontinuance of
the levying, under the laws of the Republic and of such other country or
territory, of taxes in respect of the same income, or to the rendering of
reciprocal assistance in the administration of and the collection of taxes
under the income tax laws of the Republic and of such other country or
territory.
Double taxation
agreements
(2) The Minister shall lay a copy of an agreement referred to in
subsection (1) before the Cabinet for ratification.
(3) As soon as may be after the conclusion and ratification of any such
agreement, the terms thereof shall be notified by the President by
statutory instrument, whereupon, until such statutory instrument is
revoked by the President, the agreement shall have effect as if enacted in
this Act but only if, and for so long as, the agreement has the effect of
law in the other country or territory.
(4) The President may at any time revoke any such statutory instrument
by a further statutory instrument and the agreement shall cease to have
effect upon the date fixed in such latter statutory instrument, but the
revocation of any statutory instrument shall not affect the validity of
anything previously done thereunder.
(5) The duty imposed by any law to preserve secrecy with regard to
income tax shall not prevent the disclosure to any authorised officer of
the country or territory mentioned in any statutory instrument issued, in
terms of subsection (3), of the facts, knowledge of which is necessary to
enable it to be determined whether immunity, exemption or relief ought
to be given or which it is necessary to disclose in order to render or
receive assistance in accordance with the arrangements notified in such
statutory instrument.
75. (1) This section applies where, by virtue of any agreement under Double taxation
this Part, tax (in this section called foreign tax) payable to another
country in respect of any income (in this section called foreign income)
is to be allowed as a credit against Zambian tax in respect of that foreign
income.
relief
(2) The Zambian tax for any charge year in respect of foreign income is
reduced by the amount allowed as a credit in respect of that foreign
income under any agreement under this Part, but that reduction shall not
exceed the amount of that foreign income included in the income liable
to tax under this Act, multiplied by the Zambian tax before the
reduction, divided by the sum of the income assessable under this Act
and the income which the Commissioner-General is prohibited from
including in an assessment under the provisos to subsection (1) of
section sixtythree.
(3) In this section, "Zambian tax" means income tax chargeable under
this Act.
76. (1) Where a person is liable to pay Zambian tax for any charge year
in respect of income received from a source within a country which has
not entered into an agreement under this Part (in this section called
foreign income) and he has paid tax on that income in the country from
which it was received (in this section called foreign tax), then the
Zambian tax for that charge year in respect of the foreign income is
reduced by the amount of foreign tax, but that reduction shall not exceed
the amount of the foreign income included in the income liable to tax
under this Act, multiplied by the Zambian tax before the reduction,
divided by the sum of the income assessable under this Act and the
income which the Commissioner-General is prohibited from including
in an assessment under the provisos to subsection (1) of section
sixtythree.
Unilateral double
taxation relief
(2) In this section, "Zambian tax" means income tax chargeable under
this Act.
(3) This section shall not apply to income which the
Commissioner-General is prohibited from including in an assessment
under the provisions to subsection (1) of section sixty-three.
PART VIII
COLLECTION, RECOVERY AND RELIEFS
77. (1) Subject to the provisions of this Act, tax for any charge year
payable by any person required to submit a return under section forty-six
in respect of any income shall be due and payable on 30th September
immdeiately following the end of the charge year.
(1A) any person who is liable to pay any tax in accordance with
subsection (1) for any charge year may deduct from the amount due-
(a) the amount of any payment of provisional tax which the person has
made for that charge year; and
(b) any amount of tax or provisional tax agreed by the
Commissioner-General to have been overpaid and which has not been
refunded to that person or otherwise taken into account.
(1B) Any person who is required by section foryt-six A to submit a
return of provisional income and tax for any charge year shall make
payments of provisional tax to the Commissioner-General in accordance
with subsections (1C) to (3).
(1C) Provisional tax for any charge year required to be paid under
subsection (1B) shall be paid during the charge year in four instalments,
each one of which shall be equal to one-quarter of the amount of
provisional tax shown in the return, and shall be paid after:
(a) 1st instalment on 30th June;
(b) 2nd instalment on 30th September;
(c) 3rd instalment 30th December; and
(d) 4th instalemnt 30th March;
of the charge year to which such return of provisional income relates.
When tax due is
payable
(2) Any person who is liable to pay any provisional tax in accordance
with subsection (1B) for any charge year may deduct from the amount
due any amount of tax or provisional tax agreed by the
Commissioner-General to have been overpaid and which has not been
refunded to that person or otherwise taken into account.
(2A) a person who reduces an instalemnt of tax or provisonal tax under
this section shall-
(a) certify in writing to the Commissioner-General the amount of tax or
provisional tax overpaid and the charge year to which it relates; and
(b) attach to that certificate a copy of the Commissioner-General's
agreement that the tax or provisional tax has been overpaid.
(2B) Where a revised return is required to be made under subsection (4)
or (6) of section forty-six A by any date, the payments of tax required to
be made in accordance with subsection (1B) shall-
(a) be made in instalments on the dates mentioned in subsection (1C) as
fall on or after that date; and
(b) be equal in amount to the amount of provisional tax shown in the
return divided by four;
but where an instalment payment has been made before an instalment os
a revised amount is due under this subsection, the amount of that revised
instalment shall be increased or reduced, as the case may reuire, so as to
take into account the excess or shortfall in the earlier payment or
payments.
(3) Any payment required by this section shall be made in such form as
the Commissioner-General may determine.
(4) Any tax payable by any person under an assessment made under
subsection (3) of section sixty-three or section sixty-four shall be due
and payable on the date notice of the assessment is given to the person
under section sixty-five.
(5) The Commissioner-General, may extend the time limited by
subsections (1), (1C) and (4) and where a time limit has been extended
under this subsection, any reference elsewhere in this Act or any
regulations made under it to the time when any payment of tax or
provisional tax is due shall be construed as a reference to the time as so
extended.
(6) Subsection (4) shall have effect notwithstanding that the person
assessed objects to or appeals against that assessment.
78. (1) Any person who fails to pay
(a) any amount of tax within one month; or
(b)any amount of provisional tax within fourteen days;
Penalty for
non-payment of tax
of the date on ehich that payment is due under section seventy-seven
shall be liable to the penalty specified in subsection (2).
(2) Any person who fails to pay tax or provisional tax in accordance
with section seventy-seven shall be liable to pay, in respect of each
month during which that amount any part of it remains unpaid, an
amount equal to five per centum of that amount or so much of it as
remains unpaid during the month in question.
(3) Where any person contravenes more than one provision of this Act
in respect of tax or provisional rax on the same income in respect of the
same period of time that person shall, under this section, be liable to pay
only one penalty in respect of that contravention.
(4) Any penalties imposed under this section shall, for the purposes of
this Act relating to collection and recovery, be deemed to be tax.
(5) The penalty prescribed in subsection (1) shall become due and
payable on the date of issue by the Commissioner-General of a notice to
that effect.
(6) For the purposes of claiming relief under any of the provisions of
this Act, any penalties imposed under this section shall not be deemed to
be part of the tax paid.
(7) The Commissioner-General may, in his discretion, remit the whole
or part of any penalties due under this section.
(8) In the event of any refund of tax or any part thereof, the penalties
imposed under this section shall be reduced to the extent that the tax to
which the penalties relate is set off or refunded and the amount of such
reduction shall be deemed to be tax paid in excess to which the
provisions of section eighty-seven shall apply.
No. 11 of 1992 and No. 3 of 1997, No.9 of 1998, Act No.6 of 1999 and
No.1 of 2001)
78A. (1) Subject to subsection (3), any payment of tax which is
overdue as specified in regulations made under sections seventy-one or
under section seventy-eight shall attract interest at the rate prescribed in
subsection (2) and shall continue to attract such interest until such time
as the payment of the tax has been remitted.
Interest on overdue
payments
(2) The rate of interest prescribed for the purpose of subsection (1) shall
be the discount rate published from time to time by the Bank of Zambia
plus two per centum per annum.
(3) The Commissioner-General may remit the whole or part of any
interest due under this section.
(4) Any interest imposed under this section shall, for the purposes of this
Act relating to collection and recovery, be deemed to be tax.
(As amended by Act No. 14 of 1994, Act No.9 of 1998 and Act No.6 of
1999)
79. (1) Tax is a debt due to the Government and may be recovered by
the Commissioner-General either by distress or by suit in any court of
competent jurisdiction.
(2) Notwithstanding the other provisions of this Act, where tax is found
to be owing to the Republic under this Act the Commissioner-General
may, by notice in writing issued to any individual or person, fix a date
for the payment of such tax:
Provided that where payment of the tax referred to in this section is to be
made by instalments, the Commissioner-General may set different dates
for the payment of such tax.
Recovery and
proceedings
79A. (1) Any officer appointed for the purpose of carrying out the
provisions of this Act may, under warrant by the
Commissioner-General, levy distress upon the goods and chattels of the
person or partnership from whom tax is recoverable.
Recovery by distress
(2) For the purposes of levying any such distress, the officer authorised
under warrant by the Commissioner-General, together with such
servants or agents as the officers may consider necessary, may break
open at any time between sunrise and sunset, any premises; and the
officer so authorised may require any police officer to be present while
such distress is being levied and any police officer so required shall
comply with such requirement.
(3) A distress levied under this section shall be kept for ten days either
at the premises at which such distress is levied or at such other place as
the person authorised under warrant may consider appropriate at the cost
of the person or partnership from whom such tax is recoverable.
(4) If the person or partnership from whom such tax is recoverable does
not pay the tax due together with the costs incurred in levying the
distress and all other costs incidental thereto within the period of ten
days mentioned in subsection (3), the goods and chattels upon which
distress has been levied shall be sold by public auction and the proceeds
realised from such sale shall be applied towards the payment of the said
costs and all further costs incurred in completing such sale and, the
surplus, if any, shall be applied in the payment of the tax and, the
balance, if any, shall be paid to such person or partnership after
deducting any further tax liable to be paid by such person or partnership.
(5) Where the full amount of the tax due and all the costs mentioned in
subsection (4) are not recovered, the Commissioner-General may
recover the deficiency either in accordance with section seventy-nine B
or any other provisions contained in this Act.
(6) No civil or criminal proceedings shall be instituted against any
officer for any act or omission arising out of the levying of distress.
(7) If the person or partnership upon whose goods or chattels distress is
to be levied, or has been levied, fraudulently removes and conveys away
such goods or chattels to prevent the Commissioner-General from
distraining them or completing the distress so levied, or if any person or
partnership wilfully and knowingly aids or assists such person or
partnership in such fraudulent conveying away or carrying off any part
of such goods or chattels or in concealing the same, every person or
partnership so offending-
(a) shall forfeit to the Commissioner-General a sum equal to double the
value of goods or chattels carried off or concealed as aforesaid, to be
recovered by action; and
(b) shall be guilty of an offence and liable on conviction to a fine not
exceeding ten thousand penalty units or to imprisonment for a term not
exceeding twelve months, or to both.
No. 14 of 1976, No. 9 of 1977, No. 11 of 1992 and
No. 13 of 1994)
79B. (1) Notwithstanding anything to the contrary contained in any
law, the Commissioner-General may institute proceedings in any
subordinate court of the first or second class for the recovery of any tax
or other amount recoverable under this Act.
Recovery through
court
(2) Any officer appointed for the purposes of carrying out the
provisions of this Act may represent the Commissioner-General in the
proceedings referred to in subsection (1) and for that purpose may
conduct any such proceedings and shall have a right of audience in
subordinate courts of the first or second class, notwithstanding any law
to the contrary.
(3) Proceedings in any court for the recovery of any tax or other amount
are deemed to be proceedings for the recovery of a debt validly
acknowledged in writing by the debtor.
(4) In any proceedings for the recovery of tax-
(a) it is not competent to question any assessment whether or not an
objection or appeal has been made against such assessment; and
(b) the mere production of an assessment or any document under the
Commissioner-General's hand or the hand of any officer duly authorised
by him is conclusive evidence as to the contents of the assessment or
document.
79C. (1) Notwithstanding anything to the contrary contained in any
other law, where a person or partnership from whom tax is due is the
owner of land situated in the Republic, the Commissioner-General may
give notice to the person or partnership in writing that the amount of tax
due shall be a charge on such land and such charge shall, without
registration that may be required under any law relating to the
registration of charges upon land, be effective from the date of service of
the notice for so long as such land remains in the ownership of such
person or partnership or until the notice is withdrawn.
Charge on land
(2) For the purposes of this section, "land" includes any vacant piece or
parcel of land and also any buildings or improvements on any piece or
parcel of land.
(As amended by Acts No. 17 and No. 14 of 1976)
79D. Where the tax due by a person relates in whole or in part to tax
charged on income derived from a partnership, the tax charged on such
income shall, where notice in writing to this effect is given by the
Commissioner-General to the partnership, be due from such partnership
and the provisions of this Act relating to collection and recovery shall
apply as if such tax had been charged on the partnership.
Recovery of partner's
tax from partnership
80. As repealed by Act No.9 of 1998
81. (1) Subject to the provisions of this section, every company
incorporated in the Republic shall deduct from every payment of
dividend, other than a pioneer industry dividend or a dividend paid to
Government, tax at the rate specified in Annexure "H" of Part III of the
Charging Schedule, or as the Commissioner-General directs to-
Deduction of tax
from dividends
(a) give effect to the provisions of any agreement made under section
seventy-four; or
(b) give effect to the provisions of the Second Schedule;
and shall account for such tax as if the payment were subject to Part VI
(which relates to Pay As You Earn); and for the purposes of this
subsection payment shall be deemed to be made on the day the dividend
accrues to the share or stock holders as provided in paragraph (a) of
subsection (2) of section five.
(2) Subject to the provisions of this section, where, in a charge year a
company has received dividends from which tax has been deducted
under subsection (1), the total amount which the company is liable to
account for under subsection (1) on dividends paid in the charge year
shall, as far as possible, be reduced by the amount of the tax so deducted,
and the company shall be liable to account only for the balance
remaining after such reduction.
(3) Subject to the provisions of this section, where the total amount of
tax deducted from dividends in a charge year as referred to in subsection
(2) exceeds the amount which a company is liable to account for on
dividends paid in the charge year before the operation of subsection (2),
the excess shall, as far as possible, be deducted from the total amount
which the company is liable to account for on dividends paid, after the
operation of subsections (2), in the following charge year and so on from
year to year until the excess is extinguished.
(4) Where in any charge year after the operation of subsection (2) and
(3) there is an excess available to be deducted in accordance with
subsection (3) from the amount which a company is liable to account for
in the following or a subsequent charge year and the company was
directed by the Commissioner-General to deduct tax from dividends
paid in the charge year in accordance with paragraph (a) or (b) of
subsection (1), then the difference between what the company would
have been liable to account for but for the said direction and the amount
the company is liable to account for before the operation of subsections
(2) and (3) (not exceeding the amount of excess available), shall be
deemed to be tax paid in excess to which the provisions of section
eighty-seven shall apply and the excess available to be deducted in the
following or a subsequent charge year shall be reduced by the amount so
treated as tax paid in excess.
(5) Every company, upon payment of a dividend as provided in
subsection (1), shall furnish the share or stock holder to whom the
dividend is paid with a certificate stating in relation to the dividend-
(a) the share or stock holder's name and address;
(b) the date of payment;
(c) the amount of dividend payable before the deduction of tax;
(d) the amount of tax deducted;
(e) the net amount paid; and
(f) such other particulars as the Commissioner-General may by notice in
writing require;
and shall send a copy of the certificate to the Commissioner-General.
(6) The certificate furnished under subsection (5) shall be treated as if it
were an assessment for the purpose of Part XI only, and the date of
service shall be deemed to be ten days after the date of payment shown
thereon.
(7) For the purposes of this section-
"pioneer industry dividend" means a dividend exempted by
sub-paragraph (i) of paragraph (7) of the Second Schedule.
No. 14 of 1975 and No. 10 of 1979)
81A. (1) Every person or partnership on making any payment on or
after 1st April, 1998, to or on behalf of a non-resident contractor in
respect of construction or haulage operations, irrespective of whether
such payment is made outside the Republic or not, shall, before making
any other deductions whatsoever, deduct tax from such payment at the
specified in Annexure L of Part III of the charging Schedule and that
person or partnership shall account for such tax as if it were a payment
subject to Part VI of the Act.
(a) "non-resident contractor" means-
(i) an individual, who is neither resident nor ordinarily resident in the
Republic; or
(ii) any other person or partnership who is not resident in the Republic
and who does not have a permanent establishment in the Republic;
(b) a partnership shall be resident in the Republic-
(i) if the partners are resident or ordinarily resident in the Republic; or
(ii) if they are not all resident or ordinarily resident in the Republic,
Deduction of tax
from payment made
to non-resident
contractor
where the majority of the partners are resident or ordinarily resident in
the Republic;
(c) "construction operations" include-
(i) the erection, alteration, maintenance, repair, extension or demolition
of any building or structure, whether permanent or not;
(ii) the installation in any building or structure of heating, elevators, air
conditioning, ventilation, power, drainage, sanitation, water or fire
protection, or like supplies or services;
(iii) the painting or decorating of the internal or external surfaces of any
buildin or structure;
(iv) any operations which are an integral part of, or prior to, or which
render complete, the operations described in paragraphs (i) to (iii) of this
subsection; and
(d) "haulage operations" includes transportation by land, water or air of
persons, livestock or nay goods whatsoever including farm produce, or
produce of a like nature, ores and minerals, food stuffs and merchandise.
(Repealed by Act No. 7 of 1996 and Amended by Act No.9 of 1998)
81AA. (1) Where a person, other than an agent of an independent status
to whom subsection (2) applies is acting on behalf of an enterprise and
has, and habitually exercises, in the Republic an authority to conclude
contracts in the name of the enterprise, that enterprise shall be deemed to
have a permanent establishment in the Republic in respect of any
activity which the person undertakes for the enterprise, unless the
activities of such person are limited to those mentioned in subsection (4)
which, if exercised through a fixed place of business, would not make
this fixed place of business a permanent establishment under the
provisions of that subsection.
(2) An enterprise shall not be deemed to have a permanent establishment
in the Republic merely because it carries on business in the through a
broker, general commission agent or any other agent of an independent
status, provided that such persons are acting in the ordinary course of
their business.
(3) The fact that a company which is a resident of the Republic controls
or is controlled by a company which is a resident of another country, or
which carries on business in that other country (whether through a
permanent establishment or otherwise), shall not of itself constitute
Definition of
permanent
establishment
either company a permanent establishment of either country.
(4) For purposes of subsection (1) the following activities shall not make
a fixed place of business a permanent establishment:
(a) the use of facilities solely for the purpose of storage or display of
goods or merchandise belonging to the enterprise;
(b) the maintenance of the stock of goods or merchandise belonging to
the enterprise solely for the purpose of storage or display;
(c) the maintenance of the stock of goods or merchandise belonging to
the enterprise solely for the purpose of processing by another enterprise;
(d) the maintenance of a fixed place of business solely for the purpose of
purchasing goods or merchandise; or for collecting information, for the
enterprise;
(e) the maintenance of a fixed place of business solely for the purpose of
carrying on, for the enterprise, any other activity of preparatory or
auxiliary character; or
(f) the maintenance of a fixed place of business solely for any
combination of activities mentioned in paragraph (a) to (e), provided
that the overall activity of the fixed place of business resulting from this
combination is of preparatory or auxiliary character.
(5) For the purposes of section eighty-one A, “permanent
establishment” means a fixed place of business at which the business of
an enterprise is wholly or partly carried on and included_
(a) a place of management;
(b) a branch;
(c) an office;
(d) a factory;
(e) a workshop;
(f) a mine, an oil or gas well, quarry or any other place of extracting or
exploitation of natural resources;
(g) a building site, a construction, assembly or installation project or
supervisory activity in connection with such site or activity, but only
where such sites, project or activity continues for a period, or periods, of
more than one hundred and eighty-three days;
(h) the furnishing of services, including consultancy services, by an
enterprise through employees or other personnel engaged by an
enterprise for such purpose, but only where activities of that nature
continue (for the same or a connected project) within the Republic for a
period or periods exceeding in the aggregate one hundred and
eighty-three days in any twelve-month period commencing on or ending
in the fiscal year concerned.
(As amended by Act No. 7 2006)
81B. (1) Where any person, institution or authority is empowered by
any written law or otherwise to register the transfer to any property, that
person, institution or authority shall not register the transfer unless the
person or partnership transferring the property produces a tax clearance
certificate issued to them for the purpose of the transfer.
(2) Any person, institution or authority empowered to issue a trading
licence under the Trades Licensing Act or any other written law shall
not issue the trading license to any applicant unless the applicant
produces a tax a clearance certificate.
(3) Any person, institution or authority empowered to issue a permit or
mining licence under the Mines and Minerals Act shall not issue the
permit or licence to any applicant unless the applicant produces a tax
clearance certificate.
(4) A person, partnership, institution, organization, or association shall
not transact with a supplier of goods or services unless the supplier
produces a tax clearance certificate issued pursuant to subsection (2);
Provided that the Minister may by regulations determine the threshhold
at which goods or services may be supplied by a person or partnership
without the requirement of a tax clearance certificate.
(5) The Commissioner-General may by notice in writing cancel a tax
clearance certificate and the cancellation shall have effect from the date
of service of the notice on the holder of the tax clearance certificate.
(6) The holder of a tax clearance certificate shall, within thirty days after
the date of service and of the notice of cancellation of the certificate,
return the certificate to the Commissioner-General.
(7) For purpose of this section-
Tax clearance
certificate
Cap. 393
Cap. 213
“mining licence” means a gemstone, small scale or large scale mining
licence;
“permit” means a prospecting licence;
“property” means
(a) any land in Zambia; or
(b) any share issued by a company incorporated in Zambia; and
“tax clearance certificate” means a certificate issued by the
Commissioner-General, valid for such period as may be specified in it,
stating that the person or partnership to whom or to which it is issued
fulfilled all obligations imposed upon them or it by this Act and by any
other Act for which the Commissioner-General is responsible or has
made arrangements satisfactory to the Commissioner-General for doing
so.
(As amended by Act No. 1 of 200, No. 3 of 2003, No. 1 of 2005 and No.
7 of 2006)
81C. As repealed by Act No.9 of 1998
82. (1) Every person or partnership on making payment from an
approved fund of a lump sum payment shall, before making any other
deductions, deduct tax from such part of the payment as is liable to tax at
the rate specified in the Charging Schedule and that person or
partnership shall account for such tax as if the payment were subject to
Part VI (which relates to Pay As You Earn) and for the purposes of this
subsection payment shall be deemed to be made when the income is
received by the recipient as provided in section five.
Deduction of tax
from lump sum
payments
(2) Every person or partnership on making a payment referred to in
subsection (1) shall furnish the person or partnership to, or on behalf of
whom it is made with a certificate stating, in relation to the payment-
(a) the title of the approved fund;
(b) the date of approval of the fund;
(c) the date of the payee's admission to the fund;
(d) the date of change in contribution rates if increased since 30th June,
1960;
(e) the payee's name and address;
(f) the date of payment;
(g) the gross amount of the payment;
(h) the amount of tax deducted under subsection (1);
(i) the net amount of the payment; and
(j) such other particulars as the Commissioner-General may, by notice
in writing, require;
and shall send a copy to the Commissioner-General.
No. 14 of 1976 and Act No.6 of 1999)
82A. (1) Subject to the provisions of this section every person or
partnership making a payment of-
Deduction of tax
from certain payment
(a) a management or consultancy fee deemed under section eighteen to
be from a source within the Republic; or
(b) interest and royalties from a source within or deemed, under section
eighteen, to be within the Republic:
Provided that
(i) where interest payment to an individual during any one month on any
single savings account, deposit accoint or building society account, does
not exceed sixty-two thousand five hundred kwacha, then that interest
payment shall be exempt from the requirement of this action;
(ii) this section shall not apply to interest payable on a bill of exchange
drawn for one hundred and eighty days or less; and
(iii) the payment of any amount in excess of the original issue price for
any treasury bill or any other similar financial instrument sold at
discount from face value shall be deemed for the purposes of this section
to be payment of interest when any such treasury bill or any other
similar financial instrument is presented to the Bank of Zambia for
redumption or re-discount; or
(c) rent from a source within the Republic;
(d) commissions, other than Commissioner-General may determine that
the provisions of paragraph (c) or (d) shall not apply in any particular
case and shall, in writing, direct the person or partnership concerned in
nthat behalf; and the provisions of paragraph (c) or (d) as applicable
shall not apply to such person or partnership to the extent and to the
period specified in such direction.
(e) a public entertainment fee to, or on behalf of, a person or persons in
partnership not resident in the Republic; and
irrespective of whether such payment under this subsection is made
outside the Republic, shall, before making any other deductions, deduct
tax from the payment referred to in paragraphs (a), (b), (c), (d) and (e) at
the rate specified in the Charging Schedule or as the
Commissioner-General may direct to give effect to the provisions of any
agreement made under section seven-four or the provisions of the
Second Schedule and that person or partnership shall account for such
tax as if that payment were subject to Part VI (which relates to Pay As
You Earn) and for the purposes of this subsection, payment shall be
deemed to be made when the income is received by the recipient as
provided in section five.
(2) Every person or partnership shall, on making the payment referred
to in subsection (1), record on the form prescribed by the
Commissioner-General the amount of the payment, the amount of tax
deducted therefrom and such other particulars as the
Commissioner-General may require.
(3) Within fourteen days from the end of the month in which payment
from which tax is required to be deducted under subsection (1) was
made, the person or partenership making the payment, shall forward to
the Commissioner-General the form referred to in subsection (2)
together with a statement and declaration in the form prescribed by the
(4) Within fourteen days of the end of the month in which any payment
under subsection (1) is made, the person or partnership making the
payment shall furnish each person or partnership tp or on behalf of
whom a payment has been made with a certificate stating the amount of
the payment made to or on behalf of such person or partnership, the
amount of tax deducted therefrom, the dtae of issue of the certificate and
such other particulars as the Commissioner-General may require;
(5) The certificate issued under subsection (4) shall be treated as if it
were an assessment for the purposes of Part XI only, and the date of
service shall be deemed to be fourteen days after the end of the charge
year in which the payment to which the certificate relates was made;
(6) For the purposes of this section "rent" means a payment in any form,
including a fine, premium or any like amount, made as a consideration
for the use or occupation of or the right to use or occupy any real
property including personal property directly connected with the use or
occupation of, or the right to use or occupy such real property.
(7) Any person who, or partnership which, receives from the
Commissioner-General a receipt showing that such person or
partnership has deducted tax under this section from any payment of
rent shall, within fourteen days from the day of receiving such a receipt,
furnish that receipt to the payee of the rent.
(8) Where a person fails to furnish the Commissioner-General or any
other person authorised by the Commissioner-General with any
document in accordance with the requirements of this section, there
shall be charged a penalty of-
(a) in the case of an individual one hundred and seventy penalty units
per month or part thereof during which such failure continues; or
(b) in the case of a company, three hundred and forty penalty units per
month or part thereof during which such failure continues:
Provided that the Commissioner-General may remit the whole or part of
any such penalty.
No. 11 of 1975, No. 14 of 1976, No. 9 of 1977, No. 11 of 1984, No. 11 of 1985, No. 8 of
1986, No. 14 of 1987, No. 17 of 1988, No. 11 of 1992, No. 4 of 1993, No. 14 of 1994,
No. 2 of 1995, No. 7 of 1996, No.6 of 1999, No. 4 of 2000, No. 1 of 2001 and No. 1 of
2004)
82B. For the purposes of sections eighty-three, eighty-four and
eighty-six, "property" shall include moneys, cheques, promissory notes
and all other kinds of bills of exchange, and movable and immovable
property of whatsoever nature and kind.
Definition of
property
83. Any person or partnership who holds or is in possession of any
kind of property whatsoever on behalf or on account of another person
or partnership shall give the Commissioner-General all such
information in relation to that property as the Commissioner-General
may require, and, in relation to any tax due by that other person or
partnership, the Commissioner-General's rights in regard to any such
property are the same and may be exercised in as full and ample a
manner as if the property were held or in the possession of that other
person or partnership.
(As amended by Act No. 14 of 1976).
Property not in
possession
84. (1) Any person or partnership may be declared by the
Commissioner-General to be an agent for the payment of tax due by
another person or partnership.
Agent for payment of
tax
(2) Any person or partnership declared to be an agent in pursuance of
subsection (1) shall apply to the payment of the tax due so much of any
kind of property whatsoever held by him or coming into his hands on
behalf of the person or partnership from whom the tax is due as is
sufficient to pay such tax, and any such agent is hereby indemnified
against any person or partnership whatsoever in respect of all payments
so made by him.
(3) Where the Commissioner-General has reasonable grounds to
believe that a person or partnership has disposed of any kind of property
whatsoever without full consideration in money or money's worth to
another person or partnership with the intention of avoiding payment of
tax that is or may become due, he may declare such other person or
partnership an agent for the payment of tax due from the person or
partnership which has disposed of the said property and such property
shall, for the purposes of subsection (2), be deemed to be property held
by such other person or partnership on behalf of the person or
partnership which has disposed of the said property to the extent that the
open market value of the said property at the time of the disposal
exceeds the consideration given.
(4) Any person or partnership declared by the Commissioner-General to
be an agent for the payment of tax due by another person or partnership
under the provisions of any previous enactment shall be deemed to have
been declared an agent under the provisions of subsection (1).
(5) Notwithstanding the other provisions of this section, where a
shareholder of a company is absent from Zambia the company shall be
deemed to have been declared an agent for the payment of tax due by the
shareholder under subsection (1):
Provided that this subsection shall not apply to a company the ordinary
share capital of which may be bought or sold on a stock exchange or
which is controlled by any such company or any company controlled
directly or indirectly by Government.
(6) Any person who wilfully obstructs or wilfully attempts to obstruct
an agent in the execution of the duties imposed upon him by this section
shall be guilty of an offence and shall, upon conviction, be liable to a
fine not exceeding thirty thousand penalty units or to imprisonment for a
term not exceeding three years, or to both.
(As amended by Acts No.17 of 1971, No. 11 of 1974,
86. Every person who or partnership which is an agent in accordance
with the provisions of section sixty-six or declared to be an agent in
accordance with the provisions of section eighty-four and who or which
Liability where
property alienated
alienates or charges any kind of property whatsoever from which tax
ought to have been paid by such person or partnership shall be liable for
such tax as if it were tax charged on that person or partnership.
87. (1) Where for any charge year any person or partnership claims that
tax has been paid or is deemed to have been paid by deduction or
otherwise in excess of the amount-
Refunds in general
(a) liable to be paid by the person or partnership in accordance with the
(b) deductible by the person or partnership in accordance with the
(c) liable to be paid by the person or partnership because relief is due in
accordance with the provisions of sections seventy-six, eighty-eight,
eighty-nine, ninety, ninety A, ninety-one, ninety-five, ninety-five D, or
one hundred and thirteen;
the Commissioner-General shall make such assessments or adjustments
as are necessary to determine the amount of such excess and shall give
written notice to the person or partnership of the amount so determined
as paid or deemed to have been paid in excess.
(2) A claim under subsection (1) shall be made in accordance with the
provisions of the section or Schedule under which it is made, or if none,
the claim shall be made in writing to the Commissioner-General not
later than six years after the end of the charge year to which the claim
relates, or if later, six years after the date of service of the notice of
assessment or of the notification of an amount of tax deductible under
the provisions of this Act in the charge year, to which the claim relates.
(3) Where any tax is due and payable to the Commissioner-General for
any charge year under this or any other Act, the amount of the excess
shall first be applied towards the satisfaction of the tax so due and
payable to the extent of such tax, and the Commissioner-General shall
give written notice to the person or partnership of the amount so applied:
Provided that-
(i) such part of the excess which relates to tax paid by deduction shall be
deemed to be available for application on the last day of the charge year
to which the excess relates; and
(ii) subject to the provisions of section ninety-five D, such part of the
excess which relates to tax paid or deemed to have been paid other than
by deduction shall be available for application on the day such part was
paid or deemed to have been paid.
(4) Where any person or partnership claims a refund of the amount of
the excess adjusted in accordance with the provisions of subsection (3),
the Commissioner-General shall refund such adjusted excess.
(5) A claim under subsection (4) shall be made in writing to the
Commissioner-General not later than six years after the end of the
charge year to which the excess relates or, if later, six years after the date
of service of the written notice of the amount of the excess given in
accordance with the provisions of subsection (1).
(As amended by Acts No. 11 of 1975, No. 14 of 1976, No. 10 of 1979 and
No.9 of 1998)
88. (1) Where under any will or settlement, other than a settlement to
which section nineteen or section ninety-seven applies, any income (in
this section referred to as the trust income) arising from any fund is
accumulated for the benefit of any individual contingently on his
attaining some specified age or marrying, then, if such individual claims
and the Commissioner-General determines that such contingency has
happened, the sum equal to the amount by which the total amount of tax
paid on the trust income during the period of accumulation exceeds the
total amount of additional tax which would have been paid by him
during such period if such trust income and the income from any other
fund subject to the like trust for accumulation has been included in his
income shall be deemed to be tax paid in excess to which the provisions
of section eighty-seven shall apply; but in calculating such sum a
deduction shall be made in respect of any tax paid by the trust and
already repaid to him.
Refunds in cases of
accumulated income
(2) Every claim under this section shall be made in writing to the
Commissioner-General within six years after the expiry of the charge
year in which the contingency happened.
89. Where a beneficiary entitled to the whole or part of the income of a
trust or deceased's estate is assessed and chargeable to tax for any charge
year in respect of that income, any tax paid by a trust or deceased's estate
and attributable to the income so assessed and charged on the
beneficiary shall be set off against the tax chargeable for that charge
year on the beneficiary and the provisions of section eighty-seven shall
apply to any amount so paid in excess of such tax chargeable.
Refund or set-off of
tax chargeable on a
beneficiary
90. The amount of tax deducted from or paid under sections Refund or set-off of
tax deducted from
eighty-one, eighty-one A, eighty-two or eighty-two A on income received
by a person for any charge year shall be set-off against the tax
chargeable on his income for that charge year and the provisions of
section eighty-seven shall apply to any tax so deducted or paid in excess
of the tax so chargeable:
dividends, etc.
Provided that-
(i) subject to paragraph (ii), where the amount of tax which a company is
required by subsection (1) of section eighty-one to account for any
charge year is reduced by an amount of tax which has been deducted
from the dividends received by the company in that year, the amount of
tax on income from dividends received by the company in that year
which may be set off under this section against the tax chargeable on the
company's income for that year shall be the balance of that tax after any
such reduction.
(ii) in the case of a person who is not resident in the Republic for a
charge year and who receives dividends in such charge year, subject to
the provisions of any agreement under section seventy-four, the tax
deducted under section eighty-one shall not be set off or refunded;
(iii) in the case of a person who receives a lump sum payment, the tax
deducted under section eighty-two shall not be set off or refunded;
(iv) in the case of a person who is not resident in the Republic for a
charge year and who receives interest, royalties, management or
consultant fees, or public entertainment fees in such charge year, subject
to the provisions of any agreement made under section seventy-four, the
tax deducted under section eighty-two A shall not be set off or refunded.
10 of 1979 and Act No.6 of 1999)
90A. The Minister may, by statutory order, provide for the granting of
job credits in such amounts, for such periods and for such employees of
such businesses as may be prescribed therein:
Job Credits
Provided that any such order may be made with retrospective effect.
90B. Repealed by Act No. 9 of 1977.
91. (1) If any person alleges that an assessment is excessive by reason
of some error or mistake in the return or statement made by him for the
purposes of the assessment, he may, at any time, not later that six years
after the end of the charge year in respect of which the assessment was
made, make an application in writing to the Commissioner-General for
relief.
Error or mistake
relief
(2) On receiving any such application, the Commissioner-General shall
inquire into and determine the matter and shall, subject to the provisions
of this section make any assessment or other adjustment necessary to
give effect to such determination and the provisions of section
eighty-seven shall apply to any tax paid in excess as a result of such
determination.
(3) In determining any application under this section, the
Commissioner-General shall have regard to all the relevant
circumstances of the case, and in particular shall consider whether the
granting of relief would result in the exclusion from the charge to tax of
income of the applicant, and for this purpose the Commissioner-General
may take into consideration the liability of the applicant and
assessments made upon him in respect of the other years.
92. (1) The Commissioner-General may remit tax if he is satisfied that
it is not recoverable; and where the person to be charged with tax is also
subject to equity levy under the Equity Levy Act, 1982, and the amount
of the equity levy is greater than the amount of tax payable under this
Act, the Commissioner-General shall remit such tax.
Remission of tax
Cap. 338
(2) On the Commissioner-General's recommendation the Minister may
remit tax if he is satisfied that it is just to do so.
(3) This section shall not give rise to any appeal or other proceedings.
(As amended by Act No. 23 of 1968 and No.12 of 1982)
92A. The Minister may, by Statutory Instrument, exempt from, or
reduce the payment of corporate tax, income tax and withholding tax on
dividends for investors in manufacturing, agriculture, commercial
banking and insurance who operate in an area declared a tax free zone
under the Customs and Excise act to such an extent as may be specified
in that statutory instrument.
Reduction in Tax
for tax free zones
93. Notwithstanding anything contained in this Act, no tax in respect
of a charge year shall be payable by a person if the tax with which the
person is chargeable in respect of that year is less than twenty thousand
kwacha.
(As amended by Act No. 11 of 1992, No. 2 of 1995, No. 7 of 1996 and
No. 4 of 2000)
Tax less than
K20,000 not payable
PART IX
AVOIDANCE
94. The Commissioner-General
shall not allow any set-off or refund
of tax deducted under section
eighty-one where he determines that
the object, or one of the objects of a
change in the ownership of shares in
a company, whether direct or
indirect, was to obtain such set-off or
refund.
No set-off or refund where that is the object of change of ownership
of shares in company
95. (1) Where the
Commissioner-General has
reasonable grounds to believe that
the main purpose or one of the main
purposes for which any transaction
was effected (whether before or after
the commencement of this Act) was
the avoidance or reduction of
liability to tax for any charge year, or
that the main benefit which might
have been expected to accrue from
the transaction within the three years
immediately following the
completion thereof, was the
avoidance or reduction of liability to
tax, he may, if he determines it to be
just and reasonable, direct that such
adjustments shall be made as
respects liability to tax as he
considers appropriate to counteract
the avoidance or reduction of
liability to tax which would
otherwise be effected by the
transaction.
Transactions designed to avoid tax liability
(2) Without prejudice to the
generality of the powers conferred by
subsection (1), the powers conferred
thereby extend to-
(a) the charging with tax the income
of persons who, but for the
adjustments, would not be
chargeable with any tax or would not
be chargeable to the same extent;
(b) the charging of a greater amount
of tax than would be chargeable but
for the adjustments.
(3) Any direction of the
Commissioner-General under this
section shall specify the transaction
giving rise to the direction and
adjustments as respects liability to
tax which the
Commissioner-General considers
appropriate.
(As amended by Acts No. 26 of 1970,
No. 16 of 1972,
No. 11 of 1973, No. 14 of 1976, No.
10 of 1979, No. 6 of 1980,
No. 6 of 1981, No. 12 of 1982 and
Act No.6 of 1999)
95A. Repealed by Act No. 12 of
1982.
95B. (1) Where shares in any
company are held by-
Inter-company shareholdings
(a) another company or other
companies, some or all of whose
shares are held by the
first-mentioned company; or
(b) a company which is not
incorporated in the Republic, some
or all of whose shares are held by-
(i) an individual who is resident in
the Republic; or
(ii) a nominee on behalf of the
individual mentioned in
sub-paragraph (i);
whether by direct holding or through
an interest in some other company or
companies, the
Commissioner-General may, by
notice in writing to the companies
concerned, direct that, for the
purposes of this Act, the shares of all
or any of such companies shall be
deemed to be held in such manner as
he shall determine (notwithstanding
the actual shareholdings in such
companies) and any distribution of
dividends by those companies shall
be deemed to have been received by
the shareholders so determined in
such companies in accordance with
such determination.
No. 11 of 1984 and No.6 of 1999)
95C. Repealed by Act No. 7 of
1996.
95D. (1) For the purposes of this
section-
"amount of a loan" means the amount
of money advanced, the extent of
credit facilities provided, the
difference between the cost of
providing any benefit or advantage
and the amount paid for such benefit
or advantage when provided or the
difference between the open market
value, as determined by the
Commissioner-General, of an asset
transferred and the amount paid for
this at the date of transfer, as the case
may be;
"grossed up equivalent of a loan"
means such an amount as after
deduction of tax at the highest rate
specified in the Charging Schedule in
respect fo the income of an
individual for the charge year in
which the loan is made, is equal to
the amount of the loan;
Loans to effective shareholder
"loan" includes any advance of
money, the provision of credit
facilities, the provision of any benefit
or advantage (whether or not such
benefit or advantage is capable of
being turned into money or money's
worth) and the transfer of an asset.
(2) Subject to the other provisions of
this section, where in any charge year
a company makes, directly or
indirectly, any loan to any person
who at the time the loan is made is an
effective shareholder of the company
or a nominee of the effective
shareholder, the company shall pay,
without assessment, such an amount
as is equal to the difference between
the amount of the grossed up
equivalent of the loan and the
amount of the loan, as if the amount
were tax charged on the company.
(2A) Subsection (2) shall not apply
where the ordinary business of the
lender includes the making of loans
and the loan is a normal commercial
loan made in the ordinary course of
that business.
(3) Subject to the other provisions of
this section, the amount which a
company is liable to pay under this
section shall be due and payable to
the Commissioner-General within
fourteen days after the end of the
income tax month in which the loan
is made and for the purposes of this
section a loan shall be deemed to be
made by when the loan would have
been received, as provided by section
five, by the effective shareholder or
the nominee, if the loan had been
income of the effective shareholder
or of the nominee;
(4) On making payment of any
amount due under this section, the
company shall furnish the
Commissioner-General with a
certificate stating, in relation to the
loan in respect of which the amount
is being paid-
(a) the name and address of the
person to whom the loan has been
made;
(b) the date the loan was made;
(c) the grossed up equivalent of the
amount of the loan;
(d) the amount of the payment;
(e) the amount of the loan; and
(f) such other particulars as the
notice in writing, require;
and shall send a copy of the
certificate to the person to whom the
loan was made.
(5) The Commissioner-General
may, in his discretion, extend the
time limited by subsection (3) within
which the amount payable under this
section shall be paid.
(6) Where any part of the amount
payable under this section is not paid
within the time limited by subsection
(3), or as extended under subsection
(5), penalties shall be chargeable in
accordance with subsections (1) and
(2) of section seventy-eight as if the
amount payable were tax and the
remaining subsections except
subsection (7) of that section shall
apply to such penalties as if they
were penalties charged in relation to
tax.
(7) Where a company has paid any
amount payable under this section in
any charge year in respect of any
loan made and the
Commissioner-General determines
that the loan or part thereof has been
repaid by the person to whom the
loan was made or, in the event of the
death of such person by his executor
or administrator, the amount paid
relating to the loan or part thereof so
repaid, shall at the end of the charge
year in which the loan or part thereof
was repaid, be deemed to be tax paid
in excess to which the provisions of
section eighty-seven shall apply.
(8) Where any amount is payable
under this section in any charge year
in respect of any loan made, or where
such an amount would have been
payable but for the provisions of
subsection (12), and the loan or part
thereof is released or written off, the
grossed up equivalent of the amount
so released or written off shall be
deemed to be income of the person to
whom the loan was made or, in the
event of the death of such person
before the date on which the loan or
part thereof is released or written off,
of his estate, received on the day on
which the loan or part thereof is
released or written off:
Provided that-
(i) where the loan relates to the
provision of a benefit or advantage or
to the transfer of an asset, that loan
shall be deemed to have been
released or written off on the last day
of the accounts period of the
company in which the loan was made
to the extent that the loan is not
included in the debtors as shown in
the balance sheet of the company on
that day;
(ii) where the person to whom a loan
is made is not an individual, this
subsection shall not apply if at the
time the loan is released or written
off such person is not in existence.
(9) Where a company releases or
writes off a loan or part thereof and
subsection (8) applies, the company
shall, within thirty days after
releasing or writing off such loan or
part thereof, furnish the
Commissioner-General with a
certificate stating in relation to such
loan or part thereof-
(a) the name and address of the
person to whom the loan was made;
(b) the date the loan was made;
(c) the amount of the loan released or
written off
(d) the date the amount of the loan
was released or written off; and
(e) such other particulars as the
notice in writing, require;
and shall send a copy of the
certificate to the person to whom the
loan was made.
(10) Where a company releases or
writes off a loan or part thereof and
subsection (8) applies, the amount
paid by the company under this
section in respect of the loan or part
thereof so released or written off,
shall be applied firstly towards the
satisfaction of any tax payable by the
person deemed to have received
income in respect of the loan or part
thereof released or written off to the
extent of such tax and the excess
shall be deemed to be tax paid in
excess by the company to which the
provisions of section eighty-seven
shall apply.
(11) Where any amount paid by a
company is applied towards the
satisfaction of the tax payable by any
person in accordance with subsection
(10), the company shall be entitled to
recover the amount so applied from
the person on whose behalf the
amount was so applied or to retain
out of any moneys that are or may
come into his possession on behalf of
that person so much as is necessary
to indemnify him for the payment.
(12) This section shall not apply to a
loan made to an effective shareholder
or to his nominees where the joint
total of all loans made to the effective
shareholder and his nominees by all
companies to which this section
applies and of which the effective
shareholder is an effective
shareholder, does not exceed ten
million kwacha:
Provided that where the said joint
total exceeds ten million kwacha this
section shall only apply to the excess.
(13) Where the
Commissioner-General is of the
opinion that a company is liable to
pay an amount under this section but
has failed to do so, he may forthwith
make an assessment on such
company specifying the particulars
required in the certificate to be
furnished by the company under
subsection (4) and the date such
amount was due to be paid in
accordance with subsection (3).
(14) Any amount assessed by the
Commissioner-General in
accordance with subsection (13)
shall be deemed to be tax due and
payable on the date such amount was
due to be paid as stated in the
assessment and the provisions of Part
VIII, relating to the collection,
recovery and charging of penalties
shall apply thereto:
Provided that where an assessment is
made on a company under subsection
(12) by reason that while the joint
total of the loans made by such
company did not exceed twenty
thousand kwacha but the joint total
of the loans made by such company
and other companies did exceed that
sum and the Commissioner-General
determines that the company had
taken all reasonable steps before
making the loan to ascertain whether
or not this section applied to the loan
or part thereof, the amount payable
shall be due and payable within thirty
days of the date of service of the
notice of assessment.
(15) The provisions of Part V,
relating to the making of
assessments, and the provisions of
Part XI, relating to objections and
appeals against assessments, shall
apply to an assessment made under
this section.
No. 14 of 1976,
No. 13 of 1994, No. 7 of 1996 and
No.6 of 1999)
96. (1) No deduction shall be made
in respect of any loss arising from
any business which, having regard to
the nature of the business, to the
Incurred loss not deductible in certain cases
principal occupation of the owner,
partners, shareholders or other
persons having a beneficial interest
therein, to the relationship of the
business to the domestic
establishment of any such person or
to any other relevant factor, the
Commissioner-General considers it
reasonable to regard as not being
carried on mainly with a view to the
realisation of profits; and, without
prejudice to the generality of the
foregoing, a business shall be
deemed not to be carried on for any
charge year with a view to the
realisation of profits where more
than one-quarter of the amount of the
revenue expenditure incurred in such
business in such year relates to
goods, services, amenities or
benefits, or to the production of
goods, services, amenities or
benefits, which are of a personal or
domestic nature enjoyed by the
owner, partners, shareholders or
other persons having a beneficial
interest in the business or a member
of the family or the domestic
establishment of any such person.
(2) Where the
Commissioner-General is of the
opinion that any change in the
shareholding in any company, as a
direct or indirect result of which
income has been received by or has
accrued to that company during any
charge year, has been effected by any
person solely or mainly for the
purpose of utilising any loss incurred
by the company in order to avoid
liability on the part of that company
or any other person for the payment
of tax to reduce the amount thereof,
any loss incurred in any charge year
prior to the charge year in which the
change in shareholding took place
and not deducted from income and
the loss incurred for the period from
the commencement of the charge
year in which the change of
shareholding took place to the date of
the change in shareholding shall not
be deducted from any income
received by the company after the
date of the change in shareholding.
97. (1) Where because of the
existence of a trust the incidence of
tax for any charge year in relation to
a person beneficially interested in
that trust is less than would be the
case if that trust (apart from the
ascertainment of the nature and
amount of the beneficiary's interest
for the purposes of this subsection)
did not exist, the
Commissioner-General may
determine that the income of the trust
attributable to that beneficiary's
interest for any charge year shall for
the purposes of this Act be assessed
as if it were his income, and it shall
be assessed and charged accordingly.
Commissioner-General may avoid trust
(2) This section applies, with
necessary modifications, to the
administration of the estate of a
deceased person as from a year after
his death.
97A. (1) In this section-
"actual conditions" which are made
or imposed between any two
associated persons in their
commercial or financial relations;
"arms length conditions" means
subject to section ninety-seven AA
where that section applies
Transfer pricing
conditions or no conditions which
would have been made or imposed
if persons were not associated with
each
(2) The provisions of this section
shall apply where by reason of
actual conditions have been made
or imposed instead of the arms
length conditions there is, except
for this section, a reduction in
amount of income taken into
account in computing the income of
one of those associated persons
referred to in subsection (1), in this
section referred to as the first
taxpayer, chargeable to tax for a
charge year, in this section referred
to as the income year.
(3) The income of the first taxpayer
chargeable to tax in the in the
income year shall be computed for
tax purposes on the basis that the
arm's length condion had been
made or imposed, as between the
first taxpayer and other associated
person referred to in subsection (2)
instead of the actual conditions; and
a computation on that basis is
referred to as a computation on the
arm's length basis.
(4) If-
(a) in the income year and by reason
of the actual conditions, an amount
of income received by that other
person associated with the first
taxpayer, in this section referred to
as, the second taxpayer, is
increased;
(b) that increase in income
correspnds to the reduction in
income of the first taxpayer referred
to in subsection (2); and
(c) a claim under this subsection has
been made in writing by the second
taxpayer to the
Commissioner-General;
the second taxpayer's income
chargeable to tax in the income year
shall be computed on the arms
length basis for all tax purposes
except for the purposes of section
forty-six A.
(a) references to a reduction in an
amount of income include
references to a reduction to nil or to
the accrual of a loss or an increase
loss; and
(b) reference to an increase in
income include references to the
reduction in a loss whether to a
smaller amount or to nil.
(6) Subsection (4) shall not apply
unless the amount of income
mentioned in paragraph (a) of that
subsection would be taken into
account in computing the amount of
the second taxpayer's income
chargeable to tax for the income
year.
(7) For the purposes of subsection
(6) in case where no loss accrues or
a smaller loss accrues, as mentioned
in paragraph (a) of subsection (4)
and in subsection (5), a profit shall
instead be deemed to have aacrued.
(8) Where an assessment or an
amended assessment is made on the
first taxpayer and the computation
of incme on which it is based takes
into account a different amount of
income from that on which earlier
computations were based, the
second taxpayer may amend a claim
under subsection (4) accordingly.
(9) a claim by the second taxpayer
under subsection (4) shall not be
made in relation to an income year
unless-
(a) the first taxpayer has made a
return on the arm's length basis
under section forty-six A for the
income year or an assessment on
the arm's length basis is made on
that first taxpayer for that year; and
(b) it is made within three years of
the date on which that return or, if
earlier, that assessment is made, or
such longer period as the
Commissioner-General may allow.
(10) A claim may not be amended
under subsection (8) by reason of an
assessment or amended assessment
unless the amended claim is made
within one year of the date on
which the assessment or amended
assessment is made.
(11) Where a claim under
subsection (4) or an amended claim
under subsection (8) is allowed and
the claimant has been or may be
given credit by virtue of any
agreement made under section
seventy-four or under seventy-six
for foreign tax, within the meaning
of section seventy-five or
seventy-six, in computing the
amount of that credit-
(a) the foreign tax to be taken into
account as having been paid or as
Special provisions where actual
conditions include issuing security
being payable by the claimant shall
exclude any amount of foreign tax
which would not have been paid or
payable if the computation of the
income on which the foreign tax is
chargeable had, so far as it includes
income to which the claim or
amended claim relates, been made
on the arm's length basis; and
(b) the amount of the income to be
taken into account as having been
received by the claimant and in
respect of which the claimant is or
may be given credit for foreign tax
shall be determined, so far as it
includes income to which the claim
or amended claim relates, on the
arm's length basis.
(12) any adjustment required to be
made by virtue of this section shall
be made by way of discharge or
repayment of tax, by an amended
assessment or otherwise and may be
made notwithstanding that the
adjustment relates to a charge year
which ended more than six years
earlier; and subsections (3), (4) and
(5) of section eighty-seven shall
apply to an excess tax due to the
taxpayer under this section as they
apply to an excess determined
under subsection (1) of section
eighty-seven.
97AA. (1) Where-
(a) actual conditions are imposed in
terms of subsection (1) of section
ninety-seven A between two
associated persons and those
conditions include the issuing of a
security; and
(b) the matters specified in
subsection (2) are relevant, in any
way and to any extent, to the
determination of the arm's length
conditions for the purposes of
section ninety-sevenA;
those conditions shall be
determined, not only as if the
issuing company and the other
person, referred to in this section as
"the first associate", were not
associated, but also as if there were
no relationship, arrangement or
connection, whether formal or
informal, between the issuing
company and any other person
which is associated with the issuing
company unless they are both
members of the same Zambian
grouping.
(2) The matters referred to in
paragraph (b) of subsection (1) are-
(a) the appropriate level or extent of
the issuing company's overall
indebteness;
(b) whether it might be expected
that the issuing company and a
particular person would have
become parties to a transaction
involving the issue of a security by
the issuing company or the making
of a loan, or a loan of a particular
amount, to that company; and
(c) the rate of interest and other
terms that might be expected to be
applicable in any particular case to
such a transactio;
and the fact that it is not part of any
company's business to make loans
generally shall be disregarded for
the purposes of this section.
(3) The membership of a Zambian
grouping in relation to any issuing
company shall be determined as
follows:
(a) where the issuing company is
not a subsidiary of a company
resident in the Republic-
(i) if the issuing company has no
subsidiaries, the only member of
the Zambian grouping shall be the
issuing company;
(ii) if it has one or more
subsidiaries, the only members of
the Zambian grouping shall be the
isuing company and its
subsidiaries; and
(b) where the issuing company is a
subsidiary of a company resident in
the Republic, in this section
reffered to as "the Zambian holding
company", the only members of the
Zambian grouping shall be -
(i) if there is more than one
company resident in Zambia of
which the issuing company is a
subsidiary, such one them as is not
itself a subsidiary of any of the
others, and all its subsidiaries;
(ii) if sub parahraph (i) does not
apply, the Zambian holding
company and all its subsidiaries;
but the first associate is not a
member of the Zambian grouping in
any case.
(4) For the purposes of this section
referred to as "the subsidiary", is a
subsidiary of another company in
this section referred to as "the
parent" at any time if-
(i) the parent is beneficailly entitled
to more than fifty percent of any
profits of the subsidairy available
for distribution to equity holders of
the subsidiary; and
(ii) the parent would be beneficially
entitled to more than fifty percent of
any assets of the subsidiary
available for distribution to its
equity holders on winding up; and
for this purpose any profits or assets
available for distribution to any
equity holder otherwise than as an
equity holder shall be disregarded;
(b) "the issuing company" means
the company, which issued the
security referred to in paragraph (a)
of subsection (1);
(c) "security" includes securities
not creating or evidencing a charge
on assets, and any-
(i) interest paid payable by a
company on money advanced
without the issue of a security for
the advance; or
(ii) other consideration given by a
company for the use of money so
advanced;
shall be treated as if paid or payable
or given in respect of a security
issued for the advance by the
company;
(d) "subsidiary" shall have the
meaning assigned to it by paragraph
(a) of this subsection; and
(e) "Zambian grouping" refers to
those companies that are members
of a Zambian grouping within the
meaning of subsection (3);.
(5) For the purposes of subsection
(4)-
(a) the percentage entitlement of a
company means the percentage to
which the company is or would be
entitled either directly or through
another body corporate or other
bodies corporate or partly through
another body corporate or other
bodies corporate;
(b) the entitlement means, in the
case of profits, the entitlement
during the charge year, which is the
income year in question within the
meaning of subsection (2) of
section ninety-sevenA and, in the
case of assets, the entitlement at the
end of that charge year;
(c) "equity holder" means a person
who-
(i) holds ordinary shares in the
company; or
(ii) is a loan creditor of the
company inrespect of a loan which
is not a normal commercial loan;
and
(d) "ordinary shares" means all the
shares other than fixed-rate
preference shares.
(6) A "loan creditor' referred to in
subparagraph (ii) of paragraph (c)
of subsection (5), in relation to a
company, means a creditor in
respect of any debt incurred by the
company(
a) for any money borrowed or
capital assets acquired by the
company; or
(b) in respect of any redeemable
loan capital issued by the company:
Provided that a person carrying on
the business of banking shall not be
deemed to be a loan creditor in
respect of any loan capital or debt
issued or incurred by the company
for money lent by that person in the
ordinary course of that business.
(7) The "fixed rate preference
shares" referred to in paragraph (d)
of subsection (5) are shares which-
(a) not carry any right either to
conversion shares or securities of
any description or to the acquisition
of any additional shares or
securities;
(b) do not carry any right to
dividends other than dividends
which-
(i) are of a fixed amount or at a
fixed rate per centum of the
nominal value of the shares; and
(ii) represent no more than
reasonable commercial return on
the consideration received by the
company in respect of the shares;
and
(c) on the repayment do not carry
any rights to an amount exceeding
that consideration.
(8) A "normal commercial loan"
referred to in paragraph (c) of
subsection (5) is a loan(
a) which does not carry any right
either to conversion into shares or
securities or the acquisition of any
additional shares or securities;
(b) which doen not entitle the loan
creditor to any amount by way of
interest which depends to any
extent on the results of the
company's business or which
exceeds a reasonable commercial
return on the amount lent; and
(c) in respect of which the loan
creditor is entitled, on repayment to
an amount which does not exceed
the amount lent.
(As amended by Act No. 1 of 2001,
and No. 3 of 2002)
97B. (1) Section ninety-seven A
(2) shall not apply in relation to
the computations of income of any
person who carries on a business
in so far as that income is
determined by reference to the
accounts for that business for a
period beginning before 1st April,
1999.
(2) Nothing in section
ninety-seven A shall apply in
relation to any interest which is
allowable as deduction under
paragraph 22 of the Fifth Schedule
to this Act or which would be so
allowable but for the provisions of
paragraph 22A of that Schedule.
(3) Nothing in section
ninety-seven A shall apply for the
computation of any allowance
which may, in accordance with
sections thirty-three, thirty-four or
Non
application of
section 97A
thirty-four A of this Act, be
deducted in ascertaining the
profits or gains of a business or the
emoluments of any employment
or office.
97C. (1) For the purposes of
sections ninety-seven A and
ninety-seven B-
(a) any reference to a computation
on the arm's length basis shall be
construed in accordance with
subsection (3) of section
ninety-seven A;
(b) a return by a person or an
assessment on a person is made on
the arm's length basis if the
computation of income on which
it is based is made by virtue of
ninety-seven A;
(c) any reference to arrangements
or agreements means any
arrangement or agreement
whether legally enforceable or
not, and includes a reference to
understandings or mutual
practices; and
(d) "person" includes a
partnership.
(2) Section ninety-seven A applies
whenever the conditions in
question were made or imposed,
whether before, on or after 1st
April, 1999.
(3) For the purposes of sections
ninety-seven A and ninety-seven B
conditions may be taken to have
been made or imposed between
associated persons in their
commercial or financial relations-
Provisions
supplementary
to 97A
(a) whether they are made or
imposed in one arrangement or
agreement or in a series of
arrangements or agreements; and
(b) where conditions are made or
imposed in a series of
arrangements or agreements,
notwithstanding that-
(i) conditions made or imposed in
one arrangement or agreement
differ from those made or imposed
in another; or
(ii) the parties to one arrangement
or agreement differ from those to
another; or
(iii) any party to an arrangement
or agreement is not associated
with any party to that or another
arrangement or agreement.
(4) The Minister may by
regualtions make supplementary
provision for the interpretation of
subsection (3).
(5) For the purposes of section
ninety-seven A and ninety-seven B
one person is associated with
another if-
(a) one participates directly or
indirectly in the management,
control or capital of the other; or
(b) the same persons participate
directly or indirectly in the
management, control or capital of
both of them.
(6) The Minister shall make
provision by regulations on the
direct and indirect participation in
the management, control or capital
of a person, and different
provision may be made in relation
to different cases or different
classes of each case.
(7) For the purposes of section
ninety-seven A and ninety-seven b
where conditions are made or
imposed between associated
persons in their commercial or
financial relations-
(a) it shall be assumed, unless the
contrary is shown to the
satisfaction of the
Commissioner-General, that
different conditions or no
conditions would have been
imposed if those persons were not
associated; and
(b) where a clain is made under
ninety-seven A, it shall be for the
claimant to prove that the claim
satisfies that subsection.
97D. (1) The Minister shall make
regulations enabling a person, in
such cases as may be prescribed in
the regualtions, to be joined as a
party to an appeal to the Revenue
Appeal Tribunal under section
one-hundred and nine or to make
representations to the
Commissioner-General on an
objection against an assessment
under section one hundred and
eight.
(2) Regulations under subsection
(1) shall apply only in cases where
one of the grounds of the apeal or
the objection relates to the
question whether section
ninety-seven A applies in relation
Objections
and appeals
involving
transfer
pricing
to any computation relevant to the
assessment or whetger any
computation has been made in
accordance with that section.
PART X
OFFENCES AND PENALTIES
98. Any person guilty of an offence against this Act shall, unless any
other penalty is specifically provided therefor, be liable on conviction
therefor to a fine not exceeding ten thousand penalty units or to
imprisonment for a term not exceeding twelve months, or to both.
No. 14 of 1994 and No. 2 of 1995)
General Penalty
99. Every person who-
(a) without just cause shown by him fails to furnish a full and true return
in accordance with the requirements of any notice served upon him
under this Act orof section forty-six or forty-sixA or fails to give notice
to the Commissioner-General as required by section forty-five; or
(b) without just cause shown by him fails to furnish within the required
time to the Commissioner-General or to any other person any document
which under this Act or under any notice served on him under this Act
he is required so to furnish; or
(c) fails to keep any records, books, accounts or documents that he is
required to keep under this Act; or
(d) fails to produce any document for the examination or inspection of
the Commissioner-General or other person in accordance with the
requirements of this Act; or
(e) without just cause shown by him fails to attend at a time and place in
accordance with the requirements of any notice served on him under this
Act; or
(f) without just cause shown by him fails to answer any question
lawfully put to him or to supply or furnish any information lawfully
required from him under this Act; or
(g) otherwise contravenes or fails to comply with any of the provisions
of this Act or of any regulations made thereunder, or fails to comply
Penalty for failure to
comply with notice,
etc.
with any requirements of the Commissioner-General lawfully made
under this Act or under any of the Schedules thereto; or
(h) obstructs or hinders any officer acting in the discharge of his duty
under this Act;
shall be guilty of an offence against this Act.
100. (1) Every person who negligently or through wilful default or
fraudulently-
Penalty for incorrect
returns, etc.
(a) fails to furnish a return of income in accordance with the
requirements of sub-section (2) of section forty-six;
(aa) fails to furnish a provisional return of income and tax in accordance
with the requirements of section forty-sixA;
(b) makes an incorrect return by omitting therefrom or understating
therein any income of which he is required by this Act to make a return;
(c) gives any incorrect information in relation to any matter affecting his
own liability to tax or the liability to tax of any other person; or
(d) submits any incorrect balance sheet, account, or other document;
shall pay a penalty equal to-
(i) in the case of negligence, seventee point five per centum of the
amount;
(ii) in the case of wilful default, thirty-five per centum of the amount; or
(iii) in the case of fraud, fifty-two point five per centum of the amount;
of any income omitted or understated, or any expenses overstated, in
consequence of such failure, incorrect return, information or
submission.
(2) Except for paragraph (a), any reference in subsection (1) to tax or
income includes a reference to provisional tax and provisional income
respectively.
(3) The penalties provided by this section are a debt due to the
Government and shall be treated as if they were tax for the purpose of
recovery and shall be recoverable accordingly whether or not any
proceedings are commenced for any offence against this Act arising out
of the same facts.
(4) The Commissioner-General may accept a pecuniary settlement
instead of taking proceedings for the recovery of a penalty under this
section and may, in his discretion, mitigate or remit any penalty or stay
or compound any proceedings for recovery thereof and may also after
judgment in any proceedings under this Act further mitigate or entirely
remit the penalty.
(5) Notwithstanding anything contained in Part XI, where in any appeal
against an assessment which includes penalty, one of the grounds of
appeal relates to the charge of such penalty then the decision of the Tax
Appeal Court in relation to such ground of appeal shall be confined to
the question as to whether or not the failure, claim, understatement or
omission which gave rise to the penalty under subsection (1) was due to
any neglect, wilful default or fraud.
101. No complaint charging any offence under section ninety-eight or
ninety-nine shall be made at any time subsequent to six years after the
date of the commission of the offence.
Time Limit
102. (1) Any person who wilfully with intent to evade or to assist
another person to evade tax-
Penalty for
fraudulent returns,
etc.
(a) omits from a return made under this Act any income which should
under this Act be included therein; or
(b) makes any false statement or entry in any return under this Act; or
(c) gives any false answer, whether verbally or in writing, to any
question or request for information asked or made in accordance with
the provisions of this Act; or
(d) prepare or maintains or authorises the preparation of maintenance of
any false books of account or other records, or falsifies or authorises the
falsification of any books of account or records; or
(e) makes use of any fraud, art or contrivance whatsoever or authorises
the use of any such fraud, art or contrivance; or
(f) makes any fraudulent claim for the refund of any tax;
shall be guilty of an offence and on conviction shall be liable to a fine
not exceeding thirty thousand penalty units or to imprisonment for a
term not exceeding three years, or to both.
(2) Whenever in any proceedings under this section it is proved that any
false statement or entry is made in any return furnished under this Act by
or on behalf of any person or partnership, or in any books of account or
other records maintained by or on behalf of any person or partnership,
that person or the partners shall be presumed, until the contrary is
proved, to have made that false statement or entry with intent to evade
tax.
(3) Any reference in this section to income or tax includes a reference to
provosional income and provisional tax, respectively.
No. 13 of 1994, No. 2 of 1995 and No.9 of 1998)
103. Where any offence under this Act has been committed by a body
corporate, every person who, at the time of the commission of the
offence was a director, general manager, secretary or other similar
officer of such body corporate or who was acting or purporting to act in
any such capacity, shall also be guilty of that offence, unless he proves
that the offence was committed without his knowledge or consent, and
that he exercised all such diligence to prevent the commission of the
offence, as he ought to have exercised, having regard to the nature of his
functions in such capacity and in all the circumstances.
Bodies corporate
104. If an officer authorised by the Commissioner-General to inquire
into the affairs under this Act of any person satisfies a magistrate that in
fact or according to reasonable suspicion that person has committed an
offence under this Act, the magistrate may, by warrant, authorise the
officer to exercise all or any of the following powers:
(a) between sunrise and sunset to enter any premises to search for
money or documents or electronically stored data;
(b) to open, or remove from the premises and open, any article in which
money or documents or electronically stored data may be contained;
(c) to seize any documents or electronically stored data which may be
necessary for assessment or any criminal or other proceedings and retain
them for so long as they are required for such purposes.
Power to search and
seize
105. (1) In any civil or criminal proceedings under this Act any relevant
document in the Commissioner-General's possession shall be received
in evidence on mere production as such and shall be prima facie
evidence of its contents, but the person affected by such production shall
be given not less than four days' notice of intention to produce a
document under this section, and he shall be given an opportunity to
inspect and copy that document.
Documents in
evidence
(2) Statements made or documents produced by or on behalf of any
person shall not be inadmissible in any proceedings to which this section
applies by reason only that it has been brought to his attention that-
(a) in relation to tax the Commissioner-General may accept pecuniary
settlements instead of instituting proceedings; and
(b) though no undertaking can be given as to whether or not the
Commissioner-General will accept such a settlement in the case of any
particular person, it is the practice of the Commissioner-General to be
influenced by the fact that a person has made a full confession of any
fraud or default to which he has been a party and has given full facilities
for investigation;
and that he was or may have been induced thereby to make the
statements or produce the documents.
PART XI
OBJECTIONS AND APPEALS
106. Subject to the Commissioner-General's power relating to
assessment, every assessment under this Act shall stand good unless
proved otherwise by the person assessed upon objection or appeal
under this Part.
Assessments good until
disproved
107. (1) For the purposes of hearing and determining appeals as
provided for in this Part, there is hereby established a Tax Appeal
Court (hereinafter in this Part referred to as "the court"), consisting of
a Chairman or Deputy Chairman or a Special Chairman, as the case
may be, appointed by the Judicial Service Commission.
Establishment of Tax
Appeal Court, its
composition and powers
(2) The Chairman, Deputy Chairman and the Special Chairman shall
be persons-
(a) who are entitled to practise as advocates in Zambia;
(b) who have held a judicial office; or
(c) who, in the opinion of the Judicial Service Commission, have
sufficient knowledge of and experience in tax matters so as to be
qualified for appointment to the offices of the Chairman, Deputy
Chairman and the Special Chairman.
(3) The court shall be presided over by the Chairman, and in his
absence by the Deputy Chairman, and in the absence of the Chairman
and Deputy Chairman by the Special Chairman. The Deputy
Chairman or the Special Chairman shall do all things which the
Chairman is empowered to do under this Act, and shall, while
presiding over the court, have all the powers of the Chairman.
(4) A person shall not sit or act as a Chairman of the court if he has
any interest, direct or indirect, personal or pecuniary, in any matter
before the court.
(5) The court shall sit in such places as may be appointed by the
Chairman.
(6) The date of hearing of any appeal shall be determined by the
Chairman and notice thereof shall be published by him in the Gazette
at least one month prior to that date.
(7) There shall be paid to the Chairman of the court such
remuneration and allowances as the Attorney-General may (with the
approval of the Minister) determine.
(8) The Public Service Commission may appoint a Registrar and such
other officers of the court as it may deem necessary.
(9) If any person without reasonable excuse fails to attend as a
witness or give evidence or to produce any document in his
possession or power which relates to any matter in question on appeal
when so required by the court he may be fined summarily by the
Chairman an amount not exceeding two hundred penalty units and
ordered to serve a sentence not exceeding three months' imprisonment
in default of payment of the fine.
(10) The Minister may, by statutory instrument, make regulations
with respect to the administration, organisation, powers, practice and
procedure of the court in relation to appeals, costs on appeals and
matters connected with the foregoing.
No. 11 of 1992 and No. 13 of 1994)
108. Within thirty days of the date of service of notice of
assessment, the person assessed may make to the
Commissioner-General a written statement of objection to the
assessment setting out the grounds of objection, and the
Commissioner-General shall give that person written notice of his
decision concerning that objection:
Objection to assessment
Provided that-
(i) the Commissioner-General may determine that an objection may
be made within a longer period than thirty days but where he does not
so determine he shall give the person written notice of his
determination and the person may appeal against the determination
under section one hundred and nine without making an objection;
(ii) the right of objection to an amended assessment which is not made
as a result of an objection shall be restricted to the items in that
assessment which differ from, or are additional to, the items in the
assessment for the same charge year made immediately prior to that
assessment and only to the extent of such difference or addition;
(iii) the right of objection to an amended assessment which is made as
a result of an objection shall be the same right of objection as existed
to the assessment objected to; and
(iv) an amended assessment issued as a result of an objection shall,
unless objected to, be the Commissioner-General's written decision
concerning the objection.
109. (1) If a person assessed is dissatisfied with the
Commissioner-General's decision concerning his objection to the
assessment, that person may, by written notice to the Chairperson,
within thirty days of the date of service of the written notice of the
Commissioner-General's decision, appeal against the assessment to
the tribunal and shall send a copy of the notice to the
Appeal against
assessment
(As amended by Acts No. 14 of 1973, No. 11 of 1975 and No. 4 of
2000)
110. (1) Upon the hearing of an appeal under the Revenue Appeals
Tribunal Act, 1998, the court may make such order in relation to the
assessment under appeal as is in accordance with this Act.
Determination of
appeals
Act No. 11 pf 1998
2000)
111. (1) Either party to an appeal to the court may appeal to the High
Court from the decision of the tribunal on any question of law or
question of mixed law and fact but not on a question of fact alone.
Appeal to High Court
and Supreme Court
(2) The High Court shall hear and determine any such appeal and
may confirm, reduce, increase or annul the assessment determined by
the court and make such further or other order on such appeal,
whether as to costs or otherwise, as to the High Court may seem fit.
(3) An appeal from a decision of the High Court under this section
shall lie to the Supreme Court as it lies in the case of and as though it
were a judgement of the High Court made in the exercise of its
original civil jurisdiction.
2000)
112. (1) Where a person assessed so requests, all proceedings
concerning him under this Part shall be in private, or in camera, as the
case may be.
Privacy of proceedings
(2) Nothing in subsection (1) shall prevent the printing or publishing
of the judgement or order made on the determination of an objection
or appeal if the High Court or Supreme Court does not prohibit
publication, but any such publication shall not disclose the identity of
the taxpayer concerned.
113. On the final determination of an objection or appeal against an
assessment the Commissioner-General shall make all assessments
and adjustments as are necessary to give effect to the determination
and the provisions of section eighty-seven shall apply to any tax paid
in excess as a result of such determination.
Adjustment on
successful objection or
appeal
114. (1) Where it is provided by this Act that any matter is subject or
according to-
Appeals from
Commissioner-General's
discretions and
determinations
(a) the Commissioner-General's discretion, such discretion shall not be
questioned in any proceedings;
(b) the Commissioner-General's determination, such determination shall
only be questioned in any proceedings on the ground that it is
unreasonable.
(2) If a person is dissatisfied with a determination of the
Commissioner-General, that person may object to or appeal against that
determination as if the determination were an assessment and the
provisions of this Part relating to objections and appeals against
assessments shall apply mutatis mutandis.
(3) Where the Commissioner-General's determination as provided for
in this Act is in relation to any assessment, any appeal against that
determination shall be heard as a preliminary point upon an appeal
against that assessment, and in any other case such appeal shall be heard
as if the determination were an assessment.
115. Repealed by Act No.9 of 1998
115A. Repealed by Act No. 7 of 1996.
PART XII
REPEALS AND TRANSITIONAL PROVISIONS
116. Subject to the Seventh Schedule, the Income Tax Act, Chapter
A.L. 31 of the 1965 Edition of the Applied Laws, the Income Tax
(Employments) Act, 1966, and the Taxes Charging Act, 1966, are
repealed.

Zambia Income Tax Act 1967 (As Amended 2006)

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Zambia Income Tax Act 1967 (As Amended 2006)

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CHAPTER 323

THE INCOME TAX ACT

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