The Income Tax (Amendment) (No.20 Act,2025

An Act to amend the Income Tax Act. [30th December, 2025
ENACTED by the Parliament of Zambia. 1. (1) This Act may be cited as the Income Tax (Amendment)
(No. 2) Act, 2025, 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, 2026. 2. Section 14A of the principal Act is amended by the deletion
of subsection (5) and the substitution therefor of the following:
(5) This section shall not apply to a—
(a) person or partnership that is liable to pay presumptive
tax or turnover tax under this Act; or
(b) special purpose vehicle in the railway sector for the
first twelve years of operation of a public-private
partnership project. 3. Section 29 of the principal Act is amended by the—
(a) insertion of the following new subsection immediately after
subsection (1B):
(1C) Despite subsection (1B), in ascertaining
business gains or profits of a special purpose vehicle
in the railway sector in a charge year, a deduction
shall not be allowed on gross interest expense that
exceeds seventy percent of the tax earnings before
interest, tax, depreciation and amortisation.; and
Enactment
[No.

ed on gross interest expense that
exceeds seventy percent of the tax earnings before
interest, tax, depreciation and amortisation.; and
Enactment
[No.

17 of 2025 269Income Tax (Amendment) (No. 2)
Short title and
commencement
Cap. 323
Amendment
of section
14A
Amendment
of section 29
GOVERNMENT OF ZAMBIA
ACT
No. 17 of 2025
Date of Assent: 23rd December, 2025
Single copies of this Act may be obtained from the Government Printer,
P. O. Box 30136, 10101 Lusaka. Price K16.00 each

of Assent: 23rd December, 2025
Single copies of this Act may be obtained from the Government Printer,
P. O. Box 30136, 10101 Lusaka. Price K16.00 each

(b) 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. 4.

ng:
(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. 4.

Section 30 of the principal Act is amended by the—
(a) insertion of the following new subsection immediately after
subsection (1):
(1A) Despite subsection (1), a loss incurred by a
special purpose vehicle in the railway sector in a
charge year from a source shall be deducted from
seventy percent of the income of that special purpose
vehicle from the same source on which the loss was
incurred.;
(b) insertion of the following new subsection immediately after
subsection (2):
(2A) Where a loss referred to under subsection
(1A) exceeds seventy percent on income of a special
purpose vehicle in the railway sector from a charge
year, the excess shall, as far as possible, be deducted
from seventy percent of the income of that special
purpose vehicle from the same source on which the
loss was incurred in the following charge year.; and
(c) insertion of the following new subsection immediately after
subsection (3):
(3A) Despite subsections (1A), (2A) and (3)(b),
a loss incurred by a special purpose vehicle in the
railway sector shall not be carried forward beyond
twelve subsequent charge years after the charge year
in which the loss was incurred. 5.

icle in the
railway sector shall not be carried forward beyond
twelve subsequent charge years after the charge year
in which the loss was incurred. 5.

Section 43D of the principal Act is amended by the deletion
of subsection (2) and the substitution therefor of the following:
(2) The amount of the deduction referred to under subsection
(1) shall be two thousand five hundred Kwacha. Amendment
of section 30
Amendment
of section
43D
270 No. 17 of 2025] Income Tax (Amendment) (No. 2)

ion
(1) shall be two thousand five hundred Kwacha. Amendment
of section 30
Amendment
of section
43D
270 No. 17 of 2025] Income Tax (Amendment) (No. 2)

6. Section 55 of the principal Act is amended by the deletion of
subsection (4) and the substitution therefor of the following:
(4) Despite subsection (1A), a person carrying out mining
operations or mineral processing may keep books of account
in United States Dollars of all transactions relating to,
connected with, or incidental to the mining operations or mineral
processing if the Commissioner-General is satisfied that not
less than seventy-five per centum of that person’s gross income
from the mining operations or mineral processing is earned in
the form of foreign exchange from outside the Republic. 7.

of that person’s gross income
from the mining operations or mineral processing is earned in
the form of foreign exchange from outside the Republic. 7.

Section 64A of the principal Act is amended—
(a) by the insertion of the following new subsection immediately
after subsection (1):
(1A) Subsection (1) shall not apply to income
earned from a public service vehicle for the carriage
of persons with a seating capacity of fifty seats and
above.;
(b) by the deletion of subsection (2) and the substitution therefor
of the following:
(2) The Commissioner-General may make a
standard assessment requiring a person carrying on a
business, other than the business referred to under
subsection (1), with an annual turnover of five million
Kwacha or less, to pay tax on turnover at the rate set
out in Part II of the Ninth Schedule, except that this
subsection shall not apply to income earned by a
business from the provision of consultancy services
or from mining operations.; and
(c) in subsection (2A), by the deletion of paragraph (b) and
the substitution therefor of the following:
(b) a holder of a mining licence carrying out
artisanal mining or small-scale mining, with an annual
turnover of five million kwacha or less, to pay tax on
turnover as set out in Part IV of the Ninth Schedule. [No. 17 of 2025 271Income Tax (Amendment) (No.

ver of five million kwacha or less, to pay tax on
turnover as set out in Part IV of the Ninth Schedule. [No. 17 of 2025 271Income Tax (Amendment) (No.

2)
Amendment
of section 55
Amendment
of section
64A

2)
Amendment
of section 55
Amendment
of section
64A

8. Section 74 of the principal Act is amended by the—
(a) deletion of subsection (2) and the substitution therefor of
the following:
(2) Any information obtained by the Republic from
another country or territory under an agreement
entered into under subsection (1) shall be kept
confidential and be protected in the same manner as
information obtained under the domestic law of that
country or territory.; and
(b) insertion of the following new subsection immediately after
subsection 2:
(2A) Despite subsection (2), the information
referred to under that subsection shall only be
disclosed in accordance with the terms and conditions
specified in the agreement referred to under
subsection (1). 9.

er that subsection shall only be
disclosed in accordance with the terms and conditions
specified in the agreement referred to under
subsection (1). 9.

Section 78 of the principal Act is amended by the insertion
of the following new subsection immediately after subsection 2:
(2A) Despite subsections (1) and (2), a person who fails
to pay tax in accordance with section 77 (4) on or before the
date on which the tax is due or within a period of a notice of
assessment during which the tax assessed is due, shall be
liable to pay, in respect of each month or part of the month
during which the tax or part of the tax remains unpaid, an
amount equal to zero point five percent of the tax or part of
the tax which remains unpaid during that month or part of the
month. 10. Section 81AA of the principal Act is amended by the
insertion of the following new subsection immediately after
subsection 2:
(2A) For purposes of subsection (2)(e) and (f), a fixed
place of business shall not be considered to be of a preparatory
or auxiliary character if —
(a) an enterprise, or another enterprise related to that
enterprise, carries on business activities at the same
fixed place of business or at another fixed place of
business in the Republic; and
272 No. 17 of 2025] Income Tax (Amendment) (No.

ivities at the same
fixed place of business or at another fixed place of
business in the Republic; and
272 No. 17 of 2025] Income Tax (Amendment) (No.

2)
Amendment
of section 74
Amendment
of section 78
Amendment
of section
81AA

2)
Amendment
of section 74
Amendment
of section 78
Amendment
of section
81AA

(b) the overall activity resulting from a combination of
business activities of the related enterprise referred
to under paragraph (a), is not of a preparatory or
auxiliary character. 11. Section 81C (1A) of the principal Act is amended by the
deletion of paragraph (b) and the substitution therefor of the following:
(c) remitting a transaction above two thousand United States
Dollars or Kwacha equivalent. 12. Section 82A (1) of the principal Act is amended by the
deletion of paragraph (g). 13. Section 84 (7) of the principal Act is amended by the deletion
of the words “subsection (7)” and the substitution therefor of the
words “subsection (6)”. 14. The principal Act is amended by the insertion of the following
new section immediately after section 91:
91A. A penalty shall not be imposed on a person or
partnership where that person or partnership voluntarily
discloses to the Commissioner-General an omission, error or
mistake in relation to an assessment and the disclosure is made
by that person or partnership prior to the Commissioner-
General finding the omission, error or mistake through an audit
or in any other manner. 15.

e
by that person or partnership prior to the Commissioner-
General finding the omission, error or mistake through an audit
or in any other manner. 15.

Paragraph (5)(1) of the Second Schedule to the principal
Act is amended by the—
(a) deletion of item (l) and the substitution therefor of the
following:
(l) approved collective investment scheme to the
extent to which the income is distributed to participants
in the collective investment scheme;
(b) insertion of the following new item immediately after
item (l):
(m) private fund; and
(c) renumbering of items (m) and (n) as items (n) and (o),
respectively. [No. 17 of 2025 273Income Tax (Amendment) (No. 2)
Amendment
of section
81C
Amendment
of section
82A
Amendment
of section 84
Insertion of
section 91A
Voluntary
disclosure
Amendment
of Second
Schedule

)
Amendment
of section
81C
Amendment
of section
82A
Amendment
of section 84
Insertion of
section 91A
Voluntary
disclosure
Amendment
of Second
Schedule

16. 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
TAX ON PUBLIC SERVICE VEHICLES FOR THE CARRIAGE OF PERSONS
Type of vehicle (seating Amount of tax per
capacity) ` vehicle (per annum)
36 – 49 seater K10,368.00
22 – 35 seater K7,776.00
18 – 21 seater K5,184.00
12 – 17 seater K2,592.00
Below 12 seater (including taxis) K1,296.00;
(b) Part II and the substitution therefor of the following:
PART II
TAX ON TURNOVER
Turnover per annum Tax Rate
K30,000 or less 0 percent
Above K30,000 up to K5,000,000 5 percent; and
(c) Part III and the substitution therefor of the following:
PART III
TAX ON BETTING AND GAMING
Type of Game Monthly Tax Rate or
Monthly tax Amount
1. Casino Games (Brick and Mortar) K5,000 per table
2. Lottery Winning (Brick and 15 percent of net
Mortar) proceeds
3. Betting (Brick and Mortar) 15 percent of gross
takings
4. Gaming Machines K500 per machine
1. “Net proceeds” means gross proceeds less sum paid out
for the prizes. 2. “Gross takings” means the total amount staked by players
less the winnings payable and redemptions. 274 No. 17 of 2025] Income Tax (Amendment) (No.

2. “Gross takings” means the total amount staked by players
less the winnings payable and redemptions. 274 No. 17 of 2025] Income Tax (Amendment) (No.

2)
Amendment
of Ninth
Schedule

2)
Amendment
of Ninth
Schedule

17.

17.

The Charging Schedule to the principal Act is amended in
paragraph 5 by the—
(a) deletion of item (e) and the substitution therefor of the
following:
(e) the maximum rate of tax for the turnover received
by a person or partnership from the letting of
property shall be—
(i) zero percent per annum on turnover that
does not exceed thirty thousand
Kwacha;
(ii) four percent per annum on turnover
between thirty thousand Kwacha and
eight hundred thousand Kwacha; or
(iii) sixteen percent per annum on turnover
that exceeds eight hundred thousand
Kwacha;;
(b) insertion of the following new item immediately after
item (l):
(m) despite paragraph (l), the maximum rate of tax
charged on the income received by a special
purpose vehicle in the railway sector shall be—
(i) zero percent for the first five charge years
commencing from the first year of
operation of a public-private partnership
project;
(ii) ten percent from the sixth to the fifteenth
charge year of operation of a public-
private partnership project;
(iii) twelve percent from the sixteenth to the
twenty-fifth charge year of operation
of a public-private partnership project;
and
(iv) thirty percent per annum or the income
tax rate specified under paragraph
3(1)(b), whichever is lower, from the
[No.

ate partnership project;
and
(iv) thirty percent per annum or the income
tax rate specified under paragraph
3(1)(b), whichever is lower, from the
[No.

17 of 2025 275Income Tax (Amendment) (No. 2)
Amendment
of Charging
Schedule

276 No. 17 of 2025] Income Tax (Amendment) (No. 2)
twenty-sixth to the twenty-eighth
charge year of operation of a public-
private partnership project;; and
(c) renumbering of items (m) and (n) as items (n) and (o),
respectively.