Laws of Zambia Active 2011The Income Tax (Amendment) Act (2011)
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Income Tax (Amendment) [No. 27 of 2011 505
GOVERNMENT OF ZAMBIA
ACT
No. 27 of 2011
Date of Assent: 28th December, 2011
An Act to amend the Income Tax Act.
[29th Decmeber, 2011
ENACTED by the Parliament of Zambia.
1. (1) This Act may be cited as the Income Tax (Amendment)
Act, 2011, and shall be read as one with the Income Tax Act, in this
Act referred to as the principal Act. Short title
and commence-
ment
(2) This Act shall come into operation on 1st April, 2012, and Cap. 323
subject to any provisions to the contrary, shall have effect in relation
to the charge of tax for the charge year ending on 31st December,
2012, and in relation to each subsequent charge year.
hall have effect in relation
to the charge of tax for the charge year ending on 31st December,
2012, and in relation to each subsequent charge year.
2. Section two of the principal Act is amended in subsection
(1)— Amendment
of section 2
(a) by the deletion of the definition of “business” and the
substitution therefor of the following definition:
‘‘business” includes—
(a) any profession, vocation
or trade;
(b) any adventure or concern in the nature
of trade, whether singular or otherwise;
(c) manufacturing;
(d) fanning;
(e) hedging; and
(b) by the deletion of the definition of “charge year” and the
substitution therefor ofthe following definition:
“charge year” means the year for which tax is charged, that
is, the period of twelve months ending on the 31st
December, and each succeeding such year:
Single copies of this Act may be obtained from the Government Printer,
P.O. Box 30136, 10101 Lusaka, Price K 5,000 each.
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506 No. 27 of 2011] Income Tax (Amendment)
Provided that for the year commencing
on 1st April, 2012, and ending 31st
December, 2012, the charge year shall be
for a period of nine months.
nd ending 31st
December, 2012, the charge year shall be
for a period of nine months.
2. Section two of the principal Act is amended in subsection
(1)— Amendment
of section 2
(a) by the deletion of the definition of “business” and the
substitution therefor of the following definition:
‘‘business” includes—
(a) any profession, vocation
or trade;
(b) any adventure or concern in the nature
of trade, whether singular or otherwise;
(c) manufacturing;
(d) fanning;
(e) hedging; and
(b) by the deletion of the definition of “charge year” and the
substitution therefor ofthe following definition:
“charge year” means the year for which tax is charged, that
is, the period of twelve months ending on the 31st
December, and each succeeding such year:
Single copies of this Act may be obtained from the Government Printer,
P.O. Box 30136, 10101 Lusaka, Price K 5,000 each.
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506 No. 27 of 2011] Income Tax (Amendment)
Provided that for the year commencing
on 1st April, 2012, and ending 31st
December, 2012, the charge year shall be
for a period of nine months. Amendment 3.
December, 2012, the charge year shall be
for a period of nine months. Amendment 3.
Section eighteen of the principal Act is amended in subsection
of section 18 (1) —
(a) by the deletion, at the end of paragraph (g), after the
semi-colon, of the word “ or ”;
(b) by the deletion of the full stop at the end of paragraph (h)
and the substitution therefor of a semi-colon and the
word “ or ”; and
(c) by the insertion, immediately after paragraph (h), of the
following new paragraph:
(i) arises from a commission 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. Amendment 4.
he Republic, or paid directly or indirectly out of
funds derived from within the Republic. Amendment 4.
Section thirty A of the principal Act is amended by the deletion
of section of subsection (1) and the substitution therefor of the following:
30A
(1) The losses to be deducted by a person carrying out any
mining operations and keeping books of accounts in United
States dollars under subsection (3) of section fifty-five shall
be indexed losses. Amendment 5. Section thirty-three of the principal Act is amended by the
of section deletion of subsection (2) and the substitution therefor of the
33 following:
the principal Act is amended by the
of section deletion of subsection (2) and the substitution therefor of the
33 following:
(2) The capital allowances to be claimed by a person carrying
out any mining operations and keeping books of accounts in
United States dollars under subsection (3) of section fifty-five shall be
indexed capital allowances.
Amendment 6. Section forty-five B of the principal Act is amended in
of section subsection (1) by the deletion, in columns 1 and 2, of the words “
45B Registrar of Companies and Business Names ” and “ Registration
of companies and business names ”, respectively.
Amendment 7. Section forty-six of the principal Act is amended in subsection
of section (3) by the deletion of the words “ 30th September ” and the
46 substitution therefor of the words “ 30th June ”.
Amendment 8. Section forty-six A of the principal Act is amended—
of section 46A (a) by the deletion of subsection (3) and the substitution
therefor of the following:
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Income Tax (Amendment) [No. 27 of 2011 507
) and the substitution
therefor of the following:
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Income Tax (Amendment) [No. 27 of 2011 507
(3) The return of provisional income
referred to in subsection (2) shall be
furnished—
(a) in any charge year, not later than the 31st
March of the charge year to which the
return relates; and
(b) in the charge year ending 31st December,
2012, not later than 30th June, 2012:
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
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.; and
ble shall be taken
into account in the next instalment,
pursuant to section seventy-seven,
immediately following the date of
such revised return.; and
(b) by the deletion of subsection (4) and the substitution
therefor of the following:
(4) Where an individual is not required to make a
return of provisional income and tax—
(a) for any charge year; and
(b) for the charge year ending 31st
December, 2012;
by virtue of the proviso to subsection (1), but at a time
subsequent to 31st March in that year, and in the case of
paragraph (b) at a time subsequent to 30th June, 2012,
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.
9. Section sixty-two of the principal Act is amended in Amendment
subsection (3A) by the deletion of the words “ 31st March ” and of section 62
the substitution therefor of the words “, 31st December ”.
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508 No. 27 of 2011]
Income Tax (Amendment)
Amendment 10. Section sixty-three of the principal Act is amended in
of section 63 paragraph (iv) of the proviso to subsection (1)—
dment)
Amendment 10. Section sixty-three of the principal Act is amended in
of section 63 paragraph (iv) of the proviso to subsection (1)—
(a) by the deletion, immediately after the words “fee royalties”, of
the word “or” and the substitution therefor of a comma; and
(b) by the insertion, immediately after the words “consultancy
fee”, of the words “or commission”.
Amendment 11. Section seventy-seven of the principal Act is amended—
of section 77
(a) in subsection (1), by the deletion of the words “30th
September” and the substitution therefor of the words
“30th June”;
(b) by the deletion of subsection (1C) and the substitution
therefor of the following subsection:
(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
as follows:
(a) 1st instalment, on 31st March;
(b) 2nd instalment, on 30th June;
(c) 3rd instalment, on 30th September; and
(d) 4th instalment, on 31st December;
of the charge year to which such return of provisional
income relates.;
nt, on 30th September; and
(d) 4th instalment, on 31st December;
of the charge year to which such return of provisional
income relates.;
(c) by the insertion immediately after subsection (1C) of the
following new subsection:
(1D) Notwithstanding subsection (1C), provisional
tax required for the charge year ending 31st
December 2012, liable to be paid under subsection
(1B), shall be paid during the charge year in three
instalments, each one of which shall be equal to one
third of the amount of provisional tax shown in the
return and shall be paid as follows:
(a) 1st instalment, on 30th June, 2012;
(b) 2nd instalment, on 30th September, 2012; and
(c) 3rd instalment, on 31st December, 2012.;
(d) by the deletion in subsection (2B), of paragraphs (a) and
(b) and the substitution therefor of the following:
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Income Tax (Amendment) [No. 27 of 2011 509
in subsection (2B), of paragraphs (a) and
(b) and the substitution therefor of the following:
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Income Tax (Amendment) [No. 27 of 2011 509
(a) in any charge year—
(i) be made in instalments on the dates specified in
subsection (1C); and
(ii) be equal in amount to the amount of provisional
tax shown in the return divided by four; and
(b) in the charge year ending 31st December, 2012—
(i) be made in instalments on the dates specified in
subsection (1D); and
(ii) be equal in amount to the amount of provisional
tax shown in the return divided by three:
Provided that where an instalment payment
has been made before an instalment of a
revised amount is due under this subsection,
the amount of that revised instalment shall
be increased or reduced, as the case may
require, to take into account the excess or
shortfall in the earlier payment or payments.;
ase may
require, to take into account the excess or
shortfall in the earlier payment or payments.;
and
(e) by the insertion, in subsection (5), immediately after the
figure “(1C)”, of a comma and the figure “(1D)”.
Amendment 12. Section eighty-one B of the principal Act is amended in
of section subsection (7) by the deletion of the definition of “property” and
81B the substitution therefor of the following definition:
Cap. 340 “property” has the meaning assigned to it in the
Property Transfer Tax Act;
ing definition:
Cap. 340 “property” has the meaning assigned to it in the
Property Transfer Tax Act;
Amendment 13. Section eighty-two A of the principal Act is amended by
of section 82A the deletion of subsection (1) and the substitution therefor of the
following:
(1) Subject to the provisions of this section, every person or
partnership making a payment of—
(a) a management or consultant fee deemed und^r
section eighteen to be from a source within the
Republic;
(b) interest and royalties from a source within or deemed,
under section eighteen, to be within the Republic:
Provided that—
(i) this section shall not apply to interest payable
on a bill of exchange drawn for one hundred
and eighty days or less; and
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510 No. 27 of 2011] Income Tax (Amendment)
exchange drawn for one hundred
and eighty days or less; and
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510 No. 27 of 2011] Income Tax (Amendment)
(ii) the payment of any amount in excess of the
original issue price for any treasury bill or any
other similar financial instrument sold at a
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 for
redemption or re-discount;
(c) rent from a source within the Republic;
(d) commissions, other than commissions received by an
individual whose income is from employment or office:
Provided that the 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 that 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; or
ified in such direction;
(e) a public entertainment fee to, or on behalf of, a person or
persons in partnership not resident in the Republic; or
(f) commission deemed under section eighteen to be from a
source within the Republic;
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), (e) and (f), 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 seventy-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 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.
Amendment 14. Section one hundred of the principal Act is amended in
of section 100 subsection (1)—
(a) by the insertion immediately after sub-paragraph (i) of
the following sub-paragraph:
(ii) in relation to a person liable to pay turnover tax—
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Income Tax (Amendment) [No. 27 of 2011 511
raph:
(ii) in relation to a person liable to pay turnover tax—
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Income Tax (Amendment) [No. 27 of 2011 511
(A) in the case of negligence, one point
five percent of the amount;
(B) in the case of willful default, three
percent of the amount; and
(C) in the case of fraud, four point five
percent of the amount;
of any income omitted or understated, in
consequence of such failure or incorrect return;
and
(b) by the re-numbering of sub-paragraph (ii) as sub-paragraph (iii).
15. The Charging Schedule to the principal Act is amended—
(a) in sub-paragraph (1) of paragraph 2 by—
(i) the deletion in clause (c), of the words “ twelve
million kwacha ” and the substitution therefor
of the words “ twenty-four million kwacha ”;
(ii) the deletion in clause (d), of the words “ twelve
million kwacha ” and “ twenty million, eight
hundred and twenty thousand kwacha ” and the
substitution therefor of the words “ twenty-four
million kwacha ” and “ thirty-three million, six
hundred thousand kwacha ” respectively;
ha ” and the
substitution therefor of the words “ twenty-four
million kwacha ” and “ thirty-three million, six
hundred thousand kwacha ” respectively;
(iii) the deletion in clause (e), of the words “ twenty
million, eight hundred and twenty thousand
kwacha ” and “ fifty million, four hundred
thousand kwacha ” and the substitution therefor
of the words “ thirty-three million, six hundred
thousand kwacha ” and “ sixty-eight million, four
hundred thousand kwacha ” respectively; and
(iv) the deletion in clause (f), of the words “ fifty
million, four hundred thousand kwacha ” and
the substitution therefor of the words “ sixty-
eight million, four hundred thousand kwacha ”;
(b) by the insertion, immediately after sub-paragraph (1) of
paragraph 2, of the following new sub-paragraph:
(1A) Notwithstanding sub-paragraph (1) and subject
to the other provisions of this Act, tax in respect
of the income of an individual for the charge
year ending 31st December, 2012, shall be
charged as follows:
Amendment of Charging
Schedule
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512 No. 27 of 2011] Income Tax (Amendment)
(a) on income received by way of lump
sum payment, under section eighty-two,
at the rate of ten percent:
] Income Tax (Amendment)
(a) on income received by way of lump
sum payment, under section eighty-two,
at the rate of ten percent:
Provided that the refund of
employer’s contribution from a
defined contributory pension fund or
scheme and defined benefit fund or
scheme shall be taxed in accordance
with clauses (b), (c), (d), (e) and (f);
(b) on any income falling within subsection
(5) of section twenty-one which is not
exempt from tax under that
subsection, at the rate of ten percent;
(c) on the balance of so much of an
individual’s income as does not exceed
eighteen million kwacha, at the rate
of zero percent;
(d) on the balance of so much of an
individual’s income as exceeds
eighteen million kwacha, but does
not exceed twenty-five million,
two hundred thousand kwacha at
the rate of twenty-five percent;
(e) on the balance of so much of an
individual’s income as exceeds twenty-
five million, two hundred thousand
kwacha, but does not exceed fifty-one
million, three hundred thousand
kwacha, at the rate of thirty percent;
n, two hundred thousand
kwacha, but does not exceed fifty-one
million, three hundred thousand
kwacha, at the rate of thirty percent;
(f) on the balance of so much of an
individual’s income as exceeds fifty-
one million, three hundred thousand
kwacha at the rate of thirty-five
percent.;
(c) by the insertion, immediately after sub-
paragraph (2) of paragraph 2, of the following
new sub-paragraph:
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Income Tax (Amendment) [No. 27 of 2011 513
(2A) Notwithstanding sub-paragraph (2), in the
charge year ending 31st December, 2012, where
a person receives income by way of gratuity
under subsection (1) of section twenty-one, the
gratuity shall be charged as follows:
(a) income not exceeding the amount set
out in clause (c) of sub-paragraph (1A) of
this paragraph shall be exempt; and
(b) the balance of so much of an individual's
income as exceeds the income specified
in clause (i), at the rate of twenty-five
percent;
(d) in sub-paragraph (1) of paragraph 3 by—
(i) the deletion, in clause (b), of the words "a bank or" and
the substitution therefor of the word " an "; and
(ii) the deletion of clauses (c) and (d) and the
substitution therefor of the following:
nk or" and
the substitution therefor of the word " an "; and
(ii) the deletion of clauses (c) and (d) and the
substitution therefor of the following:
(c) on so much of the income of any
electronic communications network or
service licensee as does not exceed two
hundred and fifty million kwacha, at the
rate of thirty-five percent per annum;
and
(d) on so much of the income of any
electronic communications network or
service licensee as exceeds two
hundred and fifty million kwacha, at the
rate of forty percent per annum; and
(c) by the deletion, in clause (b) of paragraph 5, of the word
" fifteen" and the substitution therefor of the word " ten ".Have questions about this law?
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