What is Income Tax?
An income tax is a tax imposed on individuals or entities in respect of the income or profits earned by them. Income tax generally is computed as the product of a tax rate times the taxable income.
Taxation rates may vary by the type or characteristics of the taxpayer and the type of income.
How To Calculate Income Tax In Zambia
- Gross Income = Basic Salary + Allowances + Commissions + Other Emoluments.
- Taxable Income = Gross Income – all deductions/exemptions allowed by law.
- Taxable income obtained after step 2 must be applied to the tax slab.
- Total PAYE tax = Sum of the marginal taxes from step 3.
- Tax Payable = Total PAYE.
What is the income tax rate in Zambia?
Tax Rate
| Personal income tax | Progressive rates from 0 to 37.5% (2022) |
| First ZMW 54,000 | 0% |
| From ZMW 54,000 to 57,600 | 25% |
| From ZMW 57,600 to 82,800 | 30% |
| Above ZMW 82,800 | 37.5% |
Who is eligible to pay income tax in Zambia?
Income deemed to be from a Zambian source is generally subject to Zambian income tax. Zambian
residents are also subject to income tax on interest and dividends from a source outside Zambia.