Introduction

The Tanzanian tax regime is made up of direct taxation(which include personal income tax, corporate income tax and withholding tax) and indirect taxation (which include Value Added Tax (“VAT”), Customs and Excise Duty). The impact and responsibilties of the various forms of taxation differ from one tax to another. The direct taxation impacts directly on the taxpayer on whom the tax is imposed while indirect taxation is levied on goods and services and the impact is ultimately on the consumer. Some of the key tax issues that businesses and individuals need to bear in mind while working or doing business in Tanzania include, the tax administration and collection procedures, tax rates, and the dynamic and ever changing tax rules. Issues such as double taxation in Tanzania are critical for expatriates and multinational corporations. It is important that you get expert tax advice regarding your tax situation to enable you plan your business affairs, employment situation or assignment to mitigate tax and avoid double taxation.Getting to grips with the basics of tax in Tanzania and understanding your options helps you work out the best way to organise your affairs.

Paying Income Tax in Tanzania through Your Employer

If you’re working in Tanzania under a permanent contract, many employers will handle your tax under the PAYE (pay-as-you-earn) system. This means that they calculate and process your taxes in Tanzania for you and then send you a net wage. Your income tax, social security and other deductions will all be covered by this payment. This is the easiest way to handle your income tax in Tanzania, but contractors may not be offered this service because of their short stay with each employer. Independent contractors should ensure they independently manage and account for their taxes to avoid adverse tax consequences.

Tax in Tanzania

Working Out Income Tax in Tanzania Yourself

Anybody who can’t pay their tax in Tanzania through PAYE is left with the prospect of filing a tax return and doing everything themselves. Do you know much about Tanzanian tax law? Does Tanzania have a tax treaty with your home country? You will need to find out or find someone who can help! Not only does this eat into your free time, it’s also exceptionally difficult to get the most out of the system. The rules change frequently, so if you’re new to it you may be working on out-dated research and end up paying too much. Income tax in Tanzania can be anything from 15 to 30 percent, and you need to be sure you are placed in the correct tax brackets.

Using an Umbrella Company for Income Tax in Tanzania

Contractors in Tanzania are faced with masses of paperwork and numerous wasted hours filing a tax return unless they find an alternative option. A Tanzanian umbrella company can act as your employer during your stay in the country whilst still allowing you the freedom of a contractor. The only difference is that you submit your timesheets to them; they’ll calculate and pay your taxes as you earn, and then you receive a net wage (as well as documentation for your records).

Rook Consultants are experts in Tanzania taxation, and we will ensure that you keep the largest proportion of your earnings whilst complying with local laws. We can assist you deal with any issues with the Tanzanian Revenue Authority directly including processing your tax refund if you are eligible.

How We Can Help You with Tax in Tanzania

We have a portfolio of small, medium sized and multinational corporations. We assist them comply with the tax rules and obligations, plan their tax affairs to mitigate tax and assist them manage and deal with issues arising from Tanzania Revenue Authority tax audits. We also work with associates who are experts in, corporate law and immigration laws. If you have any questions about tax in Tanzania, we will provide you with the accurate answers. We also provide a comprehensive package of accounting, tax, legal and business advisory services. We are the right company to handle your tax in Tanzania.

We will be happy to provide free advice for routine and straight forward tax queries, and it comes with no obligations. Get in touch with us today for some reliable advice on tax in Tanzania!