Tax­a­tion of churches and re­li­gious or­gan­i­sa­tions

The Manica Post - - Farming/business -

THERE are sit­u­a­tions where churches and re­li­gious or­gan­i­sa­tions are re­quired to pay tax. The taxes and the spe­cific obli­ga­tions are briefly ex­plained be­low. In­come Tax on busi­ness prof­its This tax is payable on busi­ness prof­its, that is, in­come de­rived from or deemed to be from a source within Zim­babwe. The re­ceipts and ac­cru­als of church or re­li­gious or­gan­i­sa­tions are ex­empt from In­come Tax only to the ex­tent of do­na­tions, tithes, of­fer­ings or other con­tri­bu­tions by its mem­bers.

Em­ploy­ees’ Tax (PAYE) Every per­son who be­comes an em­ployer is re­quired to reg­is­ter for Pay As You Earn (PAYE)within 14 days of be­com­ing an em­ployer.

A church may qual­ify as an em­ployer if it pays any type of re­mu­ner­a­tion such as salary, wage, al­lowance, among oth­ers, to its em­ploy­ees, in this case the or­gan­i­sa­tion is re­quired to deduct the cor­rect PAYE every month ac­cord­ing to the tax ta­bles and re­mit it by the 10th of the fol­low­ing month.

Cap­i­tal Gains Tax Cap­i­tal Gains Tax is payable on cap­i­tal gains re­alised from the sale of spec­i­fied as­sets(im­mov­able prop­erty, shares and other se­cu­ri­ties). The dis­posal of spec­i­fied as­sets by a church or­gan­i­sa­tion is ex­empt from Cap­i­tal Gains Tax.

Value Added Tax (VAT) This is an in­di­rect tax levied on goods and ser­vices. Churches or re­li­gious or­gan­i­sa­tions may qual­ify to reg­is­ter for Value Added Tax (VAT) if the to­tal value of tax­able sup­plies made in the pe­riod of twelve months ex­ceeds $60, 000. VAT payable should be re­mit­ted to ZIMRA by the 25th of the fol­low­ing month. Church or­gan­i­sa­tions are not ex­empt from the pay­ment of VAT when they pur­chase goods or ser­vices which are sub­ject to VAT.

With­hold­ing Taxes

There are a num­ber of With­hold­ing Taxes charge­able in terms of the In­come Tax Act. Ex­am­ples are Non – Res­i­dents Tax on Fees, Non-Res­i­dents Tax on Roy­al­ties, Non-Res­i­dents Tax on Re­mit­tances and With­hold­ing amounts payable un­der con­tracts. A church or its pay­ing agent is ex­pected to with­hold the tax and re­mit it to ZIMRA in cases where a pay­ment is made. With­hold­ing taxes are gen­er­ally sup­posed to be re­mit­ted by the 10thof the fol­low­ing month after pay­ment or a deemed pay­ment is made.

Dis­claimer This ar­ti­cle was com­piled by the Zim­babwe Rev­enue Author­ity for in­for­ma­tion pur­poses only.

ZIMRA shall not ac­cept re­spon­si­bil­ity for loss or dam­age aris­ing from use of ma­te­rial in this ar­ti­cle and no li­a­bil­ity will at­tach to the Zim­babwe Rev­enue Author­ity.

◆ To con­tact ZIMRA: What­sApp line : +263 782 729 862 Visit our web­site : www. zimra.co.zw Fol­low us on Twit­ter : @Zim­ra_ 11 Like us on Face­book : www.face­book.com/ ZIMRA.11 Send us an e-mail : pr@ zimra.co.zw/web­mas­ter@zimra. co.zw Call us (Head Of­fice) : 04 –758891/5; 790813; 790814; 781345; 751624; 752731

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