The Income Tax (Amendment) Act, 2021

An Act to amend the Income Tax Act.
[30th December, 2021
ENACTED by the Parliament of Zambia.
1. (1) This Act may be cited as the Income Tax (Amendment)
Act, 2021, and shall be read as one with the Income Tax Act, in
this Act referred to as the principal Act.
(2) This Act shall come into operation on 1st January, 2022.
2. Section 2 (1) of the principal Act is amended by—
(a) the deletion of the definition of “commodity royalty” and
the substitution therefor of the following:
“commodity royalty” means an amount paid under
royalty financing or a general agreement to a
person or partnership, by a person or partnership
resident in the Republic that is computed by
reference to the production, profit, or to the
value of production from a mineral deposit or
other natural resource in the Republic, but does
not include the repayment of the purchase price
for the commodity royalty; :and
Income Tax (Amendment) [No. 43 of 2021 539
Enactment
Short title
and
commencement
Cap.323
Amendment
of section 2
GOVERNMENT OF ZAMBIA
ACT
No. 43 of 2021
Date of Assent: 29th December, 2021
Single copies of this Act may be obtained from the Government Printer,
P. O. Box 30136, 10101 Lusaka. Price K10.00 each

of Assent: 29th December, 2021
Single copies of this Act may be obtained from the Government Printer,
P. O. Box 30136, 10101 Lusaka. Price K10.00 each

(b) the insertion of the following definitions in the appropriate
places in alphabetical order:
“income generating real estate” means real estate
properties that generate a consistent recurring
revenue in the form of dividends, interest or cash
distribution;
“income real estate investment trust” means a
collective investment scheme that invests
primarily in income generating real estate;
“Securities and Exchange Commission” means the
Securities and Exchange Commission
established under the Securities Act, 2016;
“Zambia Agency for Persons with Disabilities” means
the Zambia Agency for Persons with Disabilities
established under the Persons with Disabilities
Act, 2012; and
“Zambia Development Agency” means the Zambia
Development Agency established under the
Zambia Development Agency Act, 2006. 3. Section 6 of the principal Act is amended by the deletion of
the marginal note and the substitution therefor of the following:
Commissioner-General’s functions. 4. Section 15 (1) of the principal Act is amended by the deletion
of the word “charities” and the substitution therefor of the words
“public benefit organisations”. 5.

of the principal Act is amended by the deletion
of the word “charities” and the substitution therefor of the words
“public benefit organisations”. 5.

Section 29 of the principal Act is amended by the—
(a) deletion of subsection (4) and the substitution therefor of
the following:
(4) Interest on which a deduction is not allowed
under this section may be treated as incurred
during the next charge year and carried forward
for five years, except that interest may be
carried forward for ten years by a person
carrying on a mining operation or generating
electricity.; and
(b) insertion of the following new subsection immediately after
subsection (4):
(4A) The interest referred to in subsection (4) shall
not exceed thirty percent of the tax earnings
before interest, tax, depreciation and
amortisation. Amendment
of section 6
Amendment
of section 29
540 No. 43 of 2021] Income Tax (Amendment)
Act No. 41
of 2016
Act No. 6 of
2012
Act No. 11 of
2006
Amendment
of section 15

n 6
Amendment
of section 29
540 No. 43 of 2021] Income Tax (Amendment)
Act No. 41
of 2016
Act No. 6 of
2012
Act No. 11 of
2006
Amendment
of section 15

6. The principal Act is amended by the insertion of the following
new section immediately after section 43A:
43B. 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
the Mines and Minerals Development Act, 2015. 7. Section 44 of the principal Act is amended by the deletion
of paragraph (p). 8. Section 63 (1) of the principal Act is amended by the insertion
of the following new paragraph immediately after paragraph (ix):
(x) distributed income of an income real estate investment trust
from which tax in respect of that charge year is deducted
under section 82A. 9. Section 64A of the principal Act is amended by the insertion
of the following new subsection immediately after subsection (3):
(3A) The Commissioner-General may make a standard
assessment requiring a person or partnership letting out
property to pay tax on turnover at the rate set out in the
Charging Schedule. 10.

a standard
assessment requiring a person or partnership letting out
property to pay tax on turnover at the rate set out in the
Charging Schedule. 10.

Section 82A of the principal Act is amended—
(a) by the deletion of subsection (1) and the substitution
therefor of the following:
(1) Subject to the provisions of this section, a person or
partnership making the following payments, irrespective of
whether the payment is made outside the Republic, shall,
before making any other deduction, deduct tax from the
following payments at the rates specified in the Charging
Schedule or as the Commissioner-General may direct to give
effect to the provisions of any agreement made under section
74 or the provisions of the Second Schedule:
(a) a management or consultant fee from a source within
or deemed under section 18 to be from a source
within the Republic;
(b) interest and royalties from a source within or deemed
under section 18 to be within the Republic other
than interest payable to a bank or financial
institution licensed under the Banking and Financial
Services Act, 2017;
(c) rent from a source within the Republic;
Income Tax (Amendment) [No. 43 of 2021 541
Insertion of
section 43B
Deduction
of mineral
royalty
Amendment
of section
44
Amendment
of section 63
Act No. 11
of 2015
Amendment
of section
64A
Amendment
of section
82A
Act No.

uction
of mineral
royalty
Amendment
of section
44
Amendment
of section 63
Act No. 11
of 2015
Amendment
of section
64A
Amendment
of section
82A
Act No.

7 of
2017

7 of
2017

(d) commissions, other than commissions received by
an individual whose income is from employment
or office;
(e) a public entertainment fee to, or on behalf of, a person
or persons in partnership not resident in the
Republic;
(f) commission deemed under section 18 to be from a
source within the Republic;
(g) winnings from gaming, lotteries and betting other
than winnings received by an individual by virtue
of employment or office;
(h) branch profits;
(i) a commodity royalty;
(j) reinsurance premium to a recipient not registered in
the Republic; and
(k) distributed income of an income real estate
investment trust.;
(b) by the insertion of the following new subsections
immediately after subsection (1A):
(1B) Subsection (1)(c) shall apply to a person or
partnership appointed by the Commissioner-
General as a withholding agent. (1C) Subsection (1)(g) shall not apply to a payment
of winnings from a brick and mortar casino. (1D) The distributed income of an income real estate
investment trust referred to under
subsection(1)(k) shall be the gross rent
collected by that income real estate investment
trust minus twenty-five percent of gross
collections.

o under
subsection(1)(k) shall be the gross rent
collected by that income real estate investment
trust minus twenty-five percent of gross
collections.

(1E) The Commissioner-General may determine that
the provisions of subsection (1) (a), (b), (c) or
(d) do not apply in a particular case and shall, in
writing, notify the person or partnership
concerned that the provisions of subsection
(1)(a), (b), (c), or (d) as applicable, do not apply
to that person or partnership to the extent and
for the period specified in the notification, except
that in the case of subsection (1) (b), the
direction to be issued under this subsection shall
only be for interest arising from a property linked
unit of a property loan stock company.;
542 No. 43 of 2021] Income Tax (Amendment)

ubsection shall
only be for interest arising from a property linked
unit of a property loan stock company.;
542 No. 43 of 2021] Income Tax (Amendment)

(c) by the deletion of subsection (2) and the substitution
therefor of the following:
(2) A person or partnership to whom subsection
(1) applies is deemed to have made a payment
at the earliest of the following:
(a) the time when payment is made;
(b) the time when income accrues to a
person; or
(c) the time when income is in any way
due to a person or held to that person’s
order or on that person’s behalf.;
(d) by the deletion of subsections (2A), (3), and (4);
(e) by the insertion of the following new subsection
immediately after subsection (2):
(3) A person or partnership making a payment shall,
within fourteen days of the end of the month in
which the payment is made and from which tax
is required to be deducted under subsection (1)
submit a return, as prescribed by the
Commissioner-General, declaring in the return
the amount of the payment, the amount of tax
deducted and other particulars that the
Commissioner-General may require.;
(f) by the numbering of subsections (5), (6), (7),(8), (9) and
(10) as subsections (4), (5), (6), (7), (8) and (9),
respectively; and
(g) by the insertion of the following new subsections
immediately after subsection (9):
(10) This section does not apply to interest payable
on a bill of exchange drawn for one hundred
and eighty days or less.

iately after subsection (9):
(10) This section does not apply to interest payable
on a bill of exchange drawn for one hundred
and eighty days or less.

(11) The payment of an amount in excess of the
original issue price for a treasury bill sold at a
discount from face value shall be deemed for
the purposes of this section to be a payment of
interest when the treasury bill is presented for
redemption or re-discount. Income Tax (Amendment) [No. 43 of 2021 543

this section to be a payment of
interest when the treasury bill is presented for
redemption or re-discount. Income Tax (Amendment) [No. 43 of 2021 543

(12) For the purposes of this section “winnings”
means anything won—
(a) for lotteries, whether in money or in money’s worth; or
(b) from gaming or betting in money or money’s worth less
the total amount staked by the person;
11. The Second Schedule to the principal Act is amended —
(a) in paragraph 5 (1), by the insertion of the following new
subparagraph immediately after subparagraph (l):
(m) income real estate investment trust approved
by the Securities and Exchange Commission.;
(b) by the deletion of paragraph 6B and the substitution
therefor of the following:
6B. Despite paragraph 5 (1) or any other provision
of this Act, any rent received by a statutory
body referred to in that paragraph is subject to
tax at the rates set out in the Charging Schedule.;
and
(c) in paragraph 7, by the deletion of the words “and approved
fund” and “any approved fund”, wherever the words
appear, and the substitution therefor of the words “a
fund”. 12.

deletion of the words “and approved
fund” and “any approved fund”, wherever the words
appear, and the substitution therefor of the words “a
fund”. 12.

The Ninth Schedule to the principal Act is amended by the
deletion of —
(a) Part I and the substitution therefor of the following:
PART I
T AX ON M OTOR VEHICLES F OR T HE C ARRIAGE OF P ERSONS
Type of vehicle Amount of tax
(sitting capacity) per vehicle (per annum)
64 seater and above K12,960
50 - 63 seater K10,800
36 - 49 seater K8,640
22 - 35 seater K6,480
18 - 21 seater K4,320
12 - 17 seater K2,160
Below 12 seater (including taxis) K1,080;
and
544 No. 43 of 2021] Income Tax (Amendment)
Amendment
of Second
Schedule
Amendment
of Ninth
Schedule

,160
Below 12 seater (including taxis) K1,080;
and
544 No. 43 of 2021] Income Tax (Amendment)
Amendment
of Second
Schedule
Amendment
of Ninth
Schedule

(b) Part III and the substitution therefor of the following:
PART III
T AX O N BETTING AND GAMING
Type of Game Monthly Tax Rate or
Monthly Tax Amount
1. Online Casino Live Games 20 percent of gross takings
2. Online Casino Machine Games 35 percent of gross takings
3. Casino Games (Brick and Mortar) K5,000 per table
4. Lottery Winnings 35 percent of net proceeds
5. Betting 25 percent of gross takings
6. Gaming Machines K500 per machine
NOTES:
1. “Net proceeds” means the gross proceeds less sums paid
out for the prizes. 2. “Gross takings” means the total amount staked by players
less the winnings payable and redemptions by the players. 13.

ums paid
out for the prizes. 2. “Gross takings” means the total amount staked by players
less the winnings payable and redemptions by the players. 13.

The Tenth Schedule to the principal Act is amended in—
(a) paragraph 1, by the deletion of item (a) and the substitution
therefor of the following:
(a) The care or counselling of, or the provision of
education programmes relating to, abandoned,
abused, neglected, orphaned or homeless children;;
and
(b) paragraph 4, by the deletion of item (b) and the
substitution therefor of the following:
(b) the provision of higher education by an institution
excluding a private institution as defined in terms
of the Technical Education, Vocational and
Entrepreneurship Training Act, 1998 or a private
higher education institution as defined by the
Higher Education Act, 2013;. 14. The Charging Schedule to the principal Act is amended—
(a) in paragraph 1, by the deletion of subparagraph (1) and
the substitution therefor of the following:
(1) Subject to subparagraph (2), the tax credit referred
to in section 14 (2) which is appropriate is—
(a) zero for an individual for a charge year;
and
Income Tax (Amendment) [No. 43 of 2021 545
Amendment
of Tenth
Schedule
Act No. 4 of
2013
Act No. 13 of
1998
Amendment
of Charging
Schedule

e year;
and
Income Tax (Amendment) [No. 43 of 2021 545
Amendment
of Tenth
Schedule
Act No. 4 of
2013
Act No. 13 of
1998
Amendment
of Charging
Schedule

(b) six thousand Kwacha per annum for a
person with a disability registered by the
Zambia Agency for Persons with
Disabilities.;
(b) in paragraph 2 (1)—
(i) in item (c), by the deletion of the words “forty-
eight thousand Kwacha” and the substitution
therefor of the words “fifty-four thousand
Kwacha”; and
(ii) in item (d), by the deletion of the words “forty-
eight thousand Kwacha” and the substitution
therefor of the words “fifty-four thousand
Kwacha”;
(c) in paragraph 3 (1)—
(i) in item (b), by the deletion of the word “thirty-
five” and the substitution therefor of the word
“thirty”;
(ii) in item (c), by the deletion of the word “thirty-
five” and the substitution therefor of the word
“thirty”; and
(iii) by the deletion of items (e) and (f); and
(iv) by the renumbering of item (g) as item (e);
(d) by the deletion of paragraph 4 and the substitution therefor
of the following:
4.

e) and (f); and
(iv) by the renumbering of item (g) as item (e);
(d) by the deletion of paragraph 4 and the substitution therefor
of the following:
4.

Subject to the provisions of this Act, tax in
respect of the income of a trust, a deceased’s
estate or bankrupt’s estate for a charge year
shall be charged at the rate of thirty percent
per annum.;
(e) in paragraph 5—
(i) by the deletion of item (e) and the substitution
therefor of the following:
(e) the maximum rate of tax for turnover
received by a person or partnership from
the letting of property shall be—
(i) four percent per annum on
turnover as does not exceed eight
hundred thousand Kwacha; and
(ii) twelve and a half percent per
annum on turnover as exceeds
eight hundred thousand Kwacha;
546 No. 43 of 2021] Income Tax (Amendment)

Kwacha; and
(ii) twelve and a half percent per
annum on turnover as exceeds
eight hundred thousand Kwacha;
546 No. 43 of 2021] Income Tax (Amendment)

(ii) by the deletion of item (g) and the substitution
therefor of the following:
(g) the maximum rate of tax for
the charge years 2021 and
2022 on income received by
a person providing
accommodation and food
services is fifteen percent;
and
(iii) by the insertion of the following new items
immediately after item (g):
(h) the maximum rate of tax for the charge years
2022 and 2023 on income received by a person
carrying on the business of manufacturing
ceramic products is zero percent; and
(i) on the income earned from exports of a business
enterprise approved by the Zambia
Development Agency and carrying on
manufacturing activities in a multi-facility
economic zone or an industrial park, tax shall
be charged at—
(i) zero percent for a period of ten years
starting from the year of
commencement of works;
(ii) half of the standard income tax rate on
the business enterprise’s profits earned
in year eleven to thirteen after the
commencement of works; and
(iii) three quarters of the standard income tax
rate on business enterprise’s profits
earned in year fourteen and fifteen
after the commencement of works.;
(f) in paragraph 6(1), by the insertion of the following new
item immediately after item (d):
(e) the rate of zero percent per annum—
(i) for dividends paid by a company operating
in a multi-facility economic zone or
industrial park under the Zambia
Development Agency Act, 2006, on
profits made on exports; and
Income Tax (Amendment) [No.

i-facility economic zone or
industrial park under the Zambia
Development Agency Act, 2006, on
profits made on exports; and
Income Tax (Amendment) [No.

43 of 2021 547
Act No. 11 of
2006

43 of 2021 547
Act No. 11 of
2006

548 No. 43 of 2021] Income Tax (Amendment)
Act No.

548 No. 43 of 2021] Income Tax (Amendment)
Act No.

7 of
2017
(ii) for a period of ten years from the time
of commencement of works in the
multi-facility economic zone or industrial
park under the Zambia Development
Agency Act, 2006.; and
(g) in paragraph 7—
(i) by the deletion of items (i) and (ii) and the
substitution therefor of the following:
(i) tax required to be deducted from a
payment of interest under section 82A
arising from interest earning accounts
held by an individual with a financial
service provider registered under the
Banking and Financial Services Act,
2017, shall be deducted at the rate of
zero percent per annum;
(ii) tax required to be deducted from a
payment of interest under section 82A,
other than interest arising from all
interest earning accounts held by an
individual with a financial service
provider registered under the Banking
and Financial Services Act, 2017, shall
be deducted at the rate of fifteen
percent per annum and shall be the final
tax;
(ii) by the deletion of item (ix);
(iii) by the renumbering of item (x) as item (ix); and
(iv) by the insertion of the following new item
immediately after item (ix):
(x) tax required to be deducted from the
payment of a reinsurance premium to
a recipient not registered in the Republic
shall be at the rate of twenty percent.

equired to be deducted from the
payment of a reinsurance premium to
a recipient not registered in the Republic
shall be at the rate of twenty percent.

Act No. 11
of 2006
Act No. 7 of
2017