Tanzania Withholding Tax

Tanzania Withholding Tax -- Resident & Non-Resident Skill v1.0

Scope note. This skill covers Tanzania Mainland withholding tax (WHT) administered by the Tanzania Revenue Authority (TRA) under the Income Tax Act, Cap. 332 and the Tax Administration Act, Cap. 438. WHT is a tax deducted at source by the payer (the withholding agent) when making a payment of a specified type, and remitted to the TRA. Some WHT is a final tax (no further return required on that income); other WHT is non-final and is creditable against the recipient's final income-tax liability. All figures are TZS (Tanzanian Shilling). Tax year = calendar year (1 January – 31 December). Zanzibar administers income tax on the same WHT bases under the union income-tax framework, but Zanzibar-specific indirect taxes are out of scope — escalate. Where a rate changed under the Finance Act 2025 (FA2025), the change is flagged and the effective date stated (in force 1 July 2025 unless otherwise stated).

Verified rates & thresholds (accountant-authored, no independent check recorded)

No independent accountant check is recorded for this version. Items flagged for further clarification are tracked separately and excluded here. This block is generated from verified skill_facts — edit the facts, not the prose.

tanzania-withholding-tax

• Dividends - general — Resident 10% / Non-resident 10% (final for resident individuals) (Income Tax Act, Cap 332, s.82, s.86)
• Dividends - DSE-listed company — 5% / 5% (Income Tax Act, Cap 332, s.82, First Schedule)
• Dividends - to resident company controlling >=25% of voting power and >=25% of shares — 5% (resident recipient); 10% non-resident (Income Tax Act, Cap 332)
• Interest — 10% / 10% (final for resident individuals unless business income) (Income Tax Act, Cap 332, s.82, s.86)
• Rent - land and buildings — 10% / 10% (final WHT for resident individuals where not business income) (Income Tax Act, Cap 332, s.82)
• Rent - aircraft lease — 10% / 10% (Income Tax Act, Cap 332)
• Rent - construction equipment or machinery — 10% / 10% (Income Tax Act, Cap 332)
• Rent - hired motor vehicles — 10% non-final WHT (new) (Income Tax Act, Cap 332 (as amended by Finance Act 2025 (in force 1 Jul 2025 unless stated)))
• Rent - other assets — 0% resident / 10% non-resident (Income Tax Act, Cap 332)
• Royalties — 15% / 15%; 10% where payment is for use of cinematography film, videotape or sound recording; 5% to resident sports entities/Tanzania Football Federation (Income Tax Act, Cap 332, s.82)
• Natural resource payments — 15% / 15% (Income Tax Act, Cap 332)
• Service fees (professional/consultancy) — 5% resident / 15% non-resident (Income Tax Act, Cap 332, s.83)
• Technical/management services to mining, oil and gas entities — Resident provider: 10% FINAL (FA2025, up from 5%); non-resident: 15% (Income Tax Act, Cap 332 (as amended by Finance Act 2025 (in force 1 Jul 2025 unless stated)))
• Director fees (non-full-time directors) — 15% / 15% (Income Tax Act, Cap 332)
• Insurance premiums — 0% resident / 10% non-resident FINAL (increased from 5% by FA2025) (Income Tax Act, Cap 332 (as amended by Finance Act 2025 (in force 1 Jul 2025 unless stated)))
• Money transfer agent commission — 10% (residents) (Income Tax Act, Cap 332)
• Fees to commercial bank agents and digital payment agents — 10% (residents) (Income Tax Act, Cap 332)
• Commission for gaming advertisement or promotion — 10% (new, FA2025) (Income Tax Act, Cap 332 (as amended by Finance Act 2025 (in force 1 Jul 2025 unless stated)))
• Payments to digital content creators — 5% (residents) (Income Tax Act, Cap 332 (introduced by Finance Act 2023))
• Digital asset exchange/transfer payments — 3% withheld by platform owner/facilitator (including non-resident platforms) (Income Tax Act, Cap 332 (Finance Act 2024))
• Payments for goods by government institutions — 2% (residents) (Income Tax Act, Cap 332)
• Minerals purchased from primary mining licence holders / artisanal miners — 2% (Income Tax Act, Cap 332)
• Verified carbon emission reduction payments — 10% (Income Tax Act, Cap 332)
• Deemed distribution of undistributed profits — 10% on 30% of profits CG deems distributed 12 months after year-end (FA2025) (Income Tax Act, Cap 332 (as amended by Finance Act 2025 (in force 1 Jul 2025 unless stated)))
• WHT payment deadline — Within 7 days after the end of the month of deduction (Income Tax Act, Cap 332, s.84)
• WHT return — Monthly; due the 7th day of the following month (Tax Administration Act, Cap 438; ITA s.84)
• Failure to withhold — Withholding agent is personally liable for the unwithheld tax (may recover from payee); interest and penalties apply (Income Tax Act, Cap 332, s.84(3); Tax Administration Act, Cap 438)
• DTT network — 9 treaties in force: Canada, Denmark, Finland, India, Italy, Norway, South Africa, Sweden, Zambia (Double tax treaties (per TRA))
• WHT exemptions (selected) — SEZ/EPZ investors; strategic investors; certain government-project loans; corporate, municipal and DSE-listed bonds of >=3 years issued from 1 Jul 2021; certain loans from non-resident financial institutions to resident financial institutions; interest on government loans from non-resident banks/governments (retrospective to 1 Jun 2017) (Income Tax Act, Cap 332 exemption provisions)

Section 1 -- Quick Reference

Quick Reference

Field	Value
Country	United Republic of Tanzania (Mainland)
Tax	Withholding Tax (WHT) on payments
Currency	TZS (Tanzanian Shilling) only
Tax year	Calendar year (1 January – 31 December)
Primary legislation	Income Tax Act, Cap. 332 (esp. ss. 82, 83, 84, 86); Tax Administration Act, Cap. 438
Tax authority	Tanzania Revenue Authority (TRA)
Filing portal	TRA online services (WHT monthly return)
WHT payment deadline	Within 7 days after the end of the month of deduction (ITA s.84)
WHT return	Monthly; due the 7th day of the following month (TAA Cap. 438; ITA s.84)
Treaty network	9 DTTs in force (see Section 1 treaty table)
Verified by	Baraka Cassian (CPA(T), CTA), Cassian & Associates
Skill version	1.0

WHT Rate Matrix — Resident vs Non-Resident (ITA Cap. 332)

WHT Rate Matrix — Resident vs Non-Resident (ITA Cap. 332) (ITA Cap. 332)

Payment type	Resident	Non-resident	Final?	Reference
Dividends — general	10%	10%	Final for resident individuals	ITA s.82, s.86
Dividends — DSE-listed company	5%	5%	Final for resident individuals	ITA s.82, First Schedule
Dividends — to resident company controlling ≥25% of voting power and ≥25% of shares	5%	10% (non-resident)	—	ITA Cap. 332
Interest	10%	10%	Final for resident individuals unless business income	ITA s.82, s.86
Rent — land and buildings	10%	10%	Final for resident individuals where not business income	ITA s.82
Rent — aircraft lease	10%	10%	—	ITA Cap. 332
Rent — construction equipment or machinery	10%	10%	—	ITA Cap. 332
Rent — hired motor vehicles (new, FA2025)	10%	10%	Non-final	ITA Cap. 332 (FA2025, in force 2025-07-01)
Rent — other assets	0%	10%	—	ITA Cap. 332
Royalties — general	15%	15%	—	ITA s.82
Royalties — use of cinematography film, videotape or sound recording	10%	10%	—	ITA s.82
Royalties — to resident sports entities / Tanzania Football Federation	5%	—	—	ITA s.82
Natural resource payments	15%	15%	—	ITA Cap. 332
Service fees (professional/consultancy)	5%	15%	—	ITA s.83
Technical/management services to mining, oil and gas entities (FA2025)	10% FINAL (resident provider; up from 5%)	15%	Resident = final	ITA Cap. 332 (FA2025, in force 2025-07-01)
Director fees (non-full-time directors)	15%	15%	—	ITA Cap. 332
Insurance premiums (FA2025)	0%	10% FINAL (up from 5%)	Non-resident = final	ITA Cap. 332 (FA2025, in force 2025-07-01)
Money transfer agent commission	10% (residents)	—	—	ITA Cap. 332
Fees to commercial bank agents and digital payment agents	10% (residents)	—	—	ITA Cap. 332
Commission for gaming advertisement or promotion (new, FA2025)	10%	—	—	ITA Cap. 332 (FA2025, in force 2025-07-01)
Payments to digital content creators (FA2023)	5% (residents)	—	—	ITA Cap. 332 (Finance Act 2023, in force 2023-07-01)
Digital asset exchange/transfer payments (FA2024)	3% withheld by platform owner/facilitator (incl. non-resident platforms)	3%	—	ITA Cap. 332 (Finance Act 2024, in force 2024-07-01)
Payments for goods by government institutions	2% (residents)	—	—	ITA Cap. 332
Minerals purchased from primary mining licence holders / artisanal miners	2%	2%	—	ITA Cap. 332
Verified carbon emission reduction payments	10%	10%	—	ITA Cap. 332
Deemed distribution of undistributed profits (FA2025)	10% on 30% of profits the CG deems distributed 12 months after year-end	—	—	ITA Cap. 332 (FA2025, in force 2025-07-01)

Double Tax Treaty (DTT) Network — In Force

Double Tax Treaty (DTT) Network — In Force (Double tax treaties per TRA)

#	Treaty partner
1	Canada
2	Denmark
3	Finland
4	India
5	Italy
6	Norway
7	South Africa
8	Sweden
9	Zambia

• Treaty cap rule — A DTT may cap the WHT rate on dividends, interest and royalties below the domestic rate for a resident of the treaty partner — apply the lower of the domestic rate and the treaty rate, subject to beneficial-ownership and any limitation-on-benefits conditions. Where no treaty applies, the domestic non-resident rate applies. (Double tax treaties per TRA)

Selected WHT Exemptions (ITA Cap. 332 exemption provisions)

Selected WHT Exemptions (ITA Cap. 332 exemption provisions) (ITA Cap. 332 exemption provisions)

Exemption	Notes
SEZ / EPZ investors	Special Economic Zone / Export Processing Zone investors
Strategic investors	Per granted incentive package
Certain government-project loans	Specified projects
Corporate, municipal and DSE-listed bonds of ≥3 years	Issued from 1 July 2021
Certain loans from non-resident financial institutions to resident financial institutions	Specified inter-bank financing
Interest on government loans from non-resident banks/governments	Exemption applied retrospectively to 1 June 2017

Compliance Deadlines (Quick View)

Compliance Deadlines (Quick View)

Item	Deadline	Reference
WHT payment (remittance to TRA)	Within 7 days after the end of the month of deduction	ITA s.84
WHT monthly return	Due the 7th day of the following month	TAA Cap. 438; ITA s.84
WHT certificate to payee	Issue to the payee so they can claim credit (non-final WHT)	ITA Cap. 332 / TAA Cap. 438

Conservative Defaults

Conservative Defaults

Ambiguity	Default
Unknown residency of the recipient	STOP — resident vs non-resident rate cannot be selected without it
Unknown whether recipient is an individual, company or entity	Flag — affects final/non-final treatment and the controlling-company dividend rate
Treaty claimed but residence/beneficial-ownership not evidenced	Apply domestic non-resident rate; do not apply treaty cap until evidenced
Unknown whether a service is "technical/management to mining/oil & gas"	Apply general service-fee rate and flag for reviewer (mining/oil & gas has its own FA2025 rate)
Unknown whether payment date is before/after 1 July 2025	Flag — FA2025 rate changes turn on the date of payment
Unknown whether recipient carries on business (interest/rent finality)	Treat as non-final and flag; finality applies only to resident individuals where not business income
Gross vs net of VAT on a service fee	Withhold on the fee per the contract; flag VAT base for reviewer

Section 2 -- Required Inputs and Refusal Catalogue

Required Inputs

• Minimum viable — Minimum viable — the payment type (dividend / interest / rent / royalty / service fee / director fee / digital / goods / mineral / etc.), the gross amount in TZS, the residency of the recipient (resident / non-resident), and the date of payment (to select the correct pre- or post-FA2025 rate).
• Recommended — Recommended — the nature of the recipient (individual / company / entity), whether the recipient carries on business (drives final vs non-final treatment), whether a DTT applies plus the recipient's tax-residence certificate, the sector (mining / oil & gas attract distinct technical-fee rates), and the contract or invoice showing the gross fee.
• Ideal — Ideal — the full payment schedule for the month (to build the monthly WHT return), prior WHT certificates issued, beneficial-ownership evidence for any treaty claim, exemption certificates (SEZ/EPZ, strategic investor, bond eligibility), and the withholding agent's TIN and TRA registration.
• Refusal if minimum is missing — Refusal if minimum is missing — HARD STOP on payment type, amount, or recipient residency. Date of payment may be soft-warned only where it is clearly outside an FA2025-affected category. Treaty claim without a tax-residence certificate = proceed at the domestic non-resident rate with a reviewer flag.

Refusal Catalogue

• R-TZ-1 — Recipient residency unknown. "WHT rates differ for resident and non-resident recipients (e.g. service fees 5% resident vs 15% non-resident). This skill cannot select a rate without confirming the recipient's residency. Please confirm before proceeding."
• R-TZ-2 — Treaty rate claimed without evidence. "A reduced treaty rate (one of the 9 DTTs in force) requires a valid tax-residence certificate and beneficial ownership. Without that evidence, apply the domestic non-resident rate. Escalate the treaty claim to a Tanzanian tax practitioner."
• R-TZ-3 — Mining / oil & gas technical and management fees. "Technical and management services to mining, oil and gas entities carry a distinct FA2025 rate (resident provider 10% FINAL, up from 5%; non-resident 15%). Confirm the sector and the payment date before applying a service-fee rate. Escalate if uncertain."
• R-TZ-4 — Final vs non-final determination. "Whether WHT is final or creditable depends on the recipient (resident individual vs company) and whether the income is business income. Mis-classifying finality affects the recipient's return. Confirm before treating WHT as final."
• R-TZ-5 — Failure-to-withhold / arrears exposure. "Where WHT was not deducted, the withholding agent is personally liable for the unwithheld tax under ITA s.84(3), plus interest and penalties under the TAA Cap. 438. Do not self-advise on remediation — escalate to a Tanzanian tax practitioner immediately."
• R-TZ-6 — Recipient income-tax return / corporate tax computation. "This skill computes WHT at source only. The recipient's annual income-tax or corporate-tax return, and how creditable (non-final) WHT offsets the final liability, is a separate workflow. Escalate."
• R-TZ-7 — Zanzibar indirect taxes. "WHT on income is administered union-wide, but Zanzibar runs its own VAT/levy regime. Zanzibar-specific indirect taxes are out of scope. Escalate."
• R-TZ-8 — Exemption eligibility (SEZ/EPZ, strategic investor, bonds). "Whether a payee qualifies for a WHT exemption (SEZ/EPZ, strategic investor, ≥3-year bonds issued from 1 July 2021, specified government/inter-bank loans) requires checking the exemption certificate and conditions. Do not assume exemption — escalate to confirm eligibility."

Section 3 -- Tier 1 Rules (When Data Is Clear)

Each rule below states the verified position and its legislative reference. FA2025 items are in force 1 July 2025 unless otherwise stated; apply the pre-FA2025 rate to payments made before that date where a change is noted.

3.1 Residency Drives the Rate

• Residency drives the rate — The first determinant is the recipient's residency. Service fees are the clearest case: 5% to a resident provider vs 15% to a non-resident (ITA s.83). Several other heads are flat across residency (e.g. dividends 10%/10%, interest 10%/10%, rent on land and buildings 10%/10%). Never select a rate without confirming residency. (ITA s.83)

3.2 Dividends (ITA s.82, s.86)

• General dividends — 10% resident / 10% non-resident. For resident individuals the WHT is a final tax. (ITA s.82, s.86)
• DSE-listed company dividends — 5% / 5% (ITA First Schedule); final for resident individuals. (ITA First Schedule)
• Inter-company relief — A dividend to a resident company controlling ≥25% of the voting power and ≥25% of the shares of the payer is withheld at 5%; a non-resident recipient is 10%. (ITA Cap. 332)

3.3 Interest (ITA s.82, s.86)

• Interest withholding — Interest is withheld at 10% / 10%. For resident individuals the WHT is final unless the interest is business income (in which case it is creditable, not final). Note the interest exemptions in Section 1 (≥3-year listed bonds from 1 July 2021; specified inter-bank and government loans; government loans from non-resident banks/governments retrospective to 1 June 2017). (ITA s.82, s.86)

3.4 Rent (ITA s.82)

• Land and buildings — 10% / 10%; final WHT for resident individuals where the rent is not business income. (ITA s.82)
• Aircraft lease — 10% / 10%. (ITA s.82)
• Construction equipment or machinery — 10% / 10%. (ITA s.82)
• Hired motor vehicles — FA2025 (new, in force 1 July 2025) — 10%, non-final WHT. This is a new head introduced by the Finance Act 2025; apply only to payments on or after 1 July 2025. (ITA s.82 (FA2025))
• Other assets — 0% resident / 10% non-resident — no WHT on rent of other assets paid to a resident. (ITA s.82)

3.5 Royalties (ITA s.82)

• General royalties — 15% / 15%. (ITA s.82)
• Cinematography film, videotape or sound recording (use of) — 10% / 10%. (ITA s.82)
• Resident sports entities / Tanzania Football Federation — 5%. (ITA s.82)

3.6 Natural Resource Payments (ITA Cap. 332)

• Natural resource payments — Withheld at 15% / 15%. (ITA Cap. 332)

3.7 Service Fees and Technical/Management Fees (ITA s.83)

• Professional / consultancy service fees — 5% resident / 15% non-resident. (ITA s.83)
• Technical and management services to mining, oil and gas entities — FA2025 — A resident provider is withheld at 10% and the WHT is FINAL (increased from 5% by the Finance Act 2025, in force 1 July 2025); a non-resident provider is withheld at 15%. Confirm the sector and the payment date (R-TZ-3). (ITA s.83 (FA2025))

3.8 Director Fees (ITA Cap. 332)

• Director fees — Fees to non-full-time directors are withheld at 15% / 15%. (Full-time/executive directors are taxed through PAYE on employment income — outside this skill.) (ITA Cap. 332)

3.9 Insurance Premiums — FA2025 (ITA Cap. 332)

• Resident recipient — 0%. (ITA Cap. 332 (FA2025))
• Non-resident recipient — 10% FINAL, increased from 5% by the Finance Act 2025 (in force 1 July 2025). (ITA Cap. 332 (FA2025))

3.10 Financial and Agency Commissions (ITA Cap. 332)

• Money transfer agent commission — 10% (residents). (ITA Cap. 332)
• Fees to commercial bank agents and digital payment agents — 10% (residents). (ITA Cap. 332)
• Commission for gaming advertisement or promotion — FA2025 (new) — 10%, introduced by the Finance Act 2025 (in force 1 July 2025). (ITA Cap. 332 (FA2025))

3.11 Digital Economy Payments

• Payments to digital content creators — 5% (residents), introduced by the Finance Act 2023 (in force 1 July 2023). (Finance Act 2023)
• Digital asset exchange/transfer payments — 3% withheld by the platform owner or facilitator — including non-resident platforms — introduced by the Finance Act 2024 (in force 1 July 2024). (Finance Act 2024)

3.12 Goods, Minerals and Carbon (ITA Cap. 332)

• Payments for goods by government institutions — 2% (residents). (ITA Cap. 332)
• Minerals purchased from primary mining licence holders / artisanal miners — 2%. (ITA Cap. 332)
• Verified carbon emission reduction payments — 10%. (ITA Cap. 332)

3.13 Deemed Distribution of Undistributed Profits — FA2025 (ITA Cap. 332)

• Deemed distribution — Under the Finance Act 2025 (in force 1 July 2025), the Commissioner General may deem 30% of a company's profits to be distributed 12 months after the year-end, and WHT of 10% applies to that deemed distribution. Flag for reviewer — this is an anti-deferral measure that turns on the company's distribution history. (ITA Cap. 332 (FA2025))

3.14 Withholding-Agent Obligations and Deadlines (ITA s.84; TAA Cap. 438)

• Deduct — Deduct the correct WHT at the time the payment is made. (ITA s.84)
• Remit — Remit to the TRA within 7 days after the end of the month of deduction. (ITA s.84)
• File — File the monthly WHT return by the 7th day of the following month. (TAA Cap. 438; ITA s.84)
• Issue a WHT certificate — Issue a WHT certificate to the payee so creditable (non-final) WHT can be claimed. (ITA Cap. 332 / TAA Cap. 438)
• Failure to withhold — The withholding agent is personally liable for the unwithheld tax (and may recover it from the payee), with interest and penalties applying. See R-TZ-5. (ITA s.84(3); TAA Cap. 438)

3.15 Treaty Override (DTTs per TRA)

• Treaty override — Where the recipient is a resident of one of the 9 treaty partners (Canada, Denmark, Finland, India, Italy, Norway, South Africa, Sweden, Zambia) and provides a valid tax-residence certificate and is the beneficial owner, apply the lower of the domestic rate and the treaty rate on dividends, interest and royalties. Absent evidence, apply the domestic non-resident rate (R-TZ-2). (Double tax treaties per TRA)

Section 4 -- Worked Examples

All amounts TZS. WHT computed on the gross payment.

Example 1 — Service fee to a resident consultant

Input: A Tanzanian company pays a resident consultancy firm a professional fee of TZS 20,000,000. Payment date 15 March 2025.

Reasoning: Resident service fee → 5% (ITA s.83). WHT = 5% × 20,000,000 = 1,000,000. Net paid to consultant = 20,000,000 − 1,000,000 = 19,000,000. Remit the 1,000,000 to the TRA within 7 days after month-end (by 7 April 2025) and file the monthly WHT return.

Classification: WHT = TZS 1,000,000; net = TZS 19,000,000.

Example 2 — Service fee to a non-resident provider

Input: Same company pays a non-resident consultancy firm TZS 20,000,000 for advisory work (no treaty evidenced).

Reasoning: Non-resident service fee → 15% (ITA s.83). WHT = 15% × 20,000,000 = 3,000,000. Net paid = 20,000,000 − 3,000,000 = 17,000,000. If the provider is a resident of a treaty partner and produces a tax-residence certificate, apply the lower treaty rate instead (R-TZ-2); otherwise the domestic 15% stands.

Classification: WHT = TZS 3,000,000; net = TZS 17,000,000.

Example 3 — Dividend to a resident individual (final)

Input: A private (non-DSE-listed) Tanzanian company pays a dividend of TZS 50,000,000 to a resident individual shareholder.

Reasoning: General dividend → 10%, and for a resident individual the WHT is final (ITA s.82, s.86). WHT = 10% × 50,000,000 = 5,000,000. Net to shareholder = 50,000,000 − 5,000,000 = 45,000,000. No further income-tax return is required on this dividend (final tax).

Classification: WHT (final) = TZS 5,000,000; net = TZS 45,000,000.

Example 4 — Dividend to a resident controlling company (≥25%/≥25%)

Input: A Tanzanian company pays a dividend of TZS 80,000,000 to a resident company that controls 30% of its voting power and holds 30% of its shares.

Reasoning: Recipient is a resident company controlling ≥25% of voting power and ≥25% of shares → reduced 5% (ITA Cap. 332). WHT = 5% × 80,000,000 = 4,000,000. Net to the holding company = 80,000,000 − 4,000,000 = 76,000,000. (Contrast: a non-resident recipient at this control level would be 10% = TZS 8,000,000.)

Classification: WHT = TZS 4,000,000; net = TZS 76,000,000.

Example 5 — Technical fee to a resident mining-services provider (FA2025, final)

Input: A mining company pays a resident technical-services provider TZS 100,000,000 on 1 August 2025 (after FA2025 took effect).

Reasoning: Technical/management services to a mining entity, resident provider, post-1 July 2025 → 10% FINAL (FA2025, up from 5%). WHT = 10% × 100,000,000 = 10,000,000 (final). Net paid = 100,000,000 − 10,000,000 = 90,000,000. Had the same payment been made before 1 July 2025, the old 5% would have applied (WHT = 5,000,000) — confirm the payment date (R-TZ-3).

Classification: WHT (final) = TZS 10,000,000; net = TZS 90,000,000.

Example 6 — Rent of hired motor vehicles (FA2025, new, non-final)

Input: A company pays TZS 12,000,000 to a resident vehicle-hire firm for hired motor vehicles on 10 September 2025.

Reasoning: Rent — hired motor vehicles is a new FA2025 head (in force 1 July 2025): 10% non-final WHT. WHT = 10% × 12,000,000 = 1,200,000. Net paid = 12,000,000 − 1,200,000 = 10,800,000. Because the WHT is non-final, issue a WHT certificate so the recipient can credit it against its final income-tax liability.

Classification: WHT (non-final) = TZS 1,200,000; net = TZS 10,800,000.

Example 7 — Royalty to a non-resident plus government-goods 2%

Input (a): A company pays a non-resident licensor a royalty of TZS 30,000,000 (general royalty, no treaty evidenced). Input (b): A government institution pays a resident supplier TZS 40,000,000 for goods.

Reasoning (a): General royalty → 15% (ITA s.82). WHT = 15% × 30,000,000 = 4,500,000; net = 25,500,000. (If it were use of cinematography film/videotape/sound recording, the rate would be 10%.)

Reasoning (b): Government payment for goods → 2% (residents). WHT = 2% × 40,000,000 = 800,000; net = 39,200,000.

Classification: (a) WHT = TZS 4,500,000; (b) WHT = TZS 800,000.

Section 5 -- Reference Material

Key Legislation / Authority References

Key Legislation / Authority References

Topic	Reference
WHT charging provisions, rates (dividends, interest, rent, royalties)	Income Tax Act, Cap. 332, s.82
Service fees WHT	Income Tax Act, Cap. 332, s.83
WHT payment / remittance and agent obligations	Income Tax Act, Cap. 332, s.84; failure-to-withhold liability s.84(3)
Final WHT for resident individuals (dividends, interest, qualifying rent)	Income Tax Act, Cap. 332, s.86
DSE-listed dividend rate; First Schedule rates	Income Tax Act, Cap. 332, First Schedule
Monthly WHT return and administrative penalties/interest	Tax Administration Act, Cap. 438
FA2025 changes (hired-vehicle rent; mining/oil & gas technical fees; insurance premiums; gaming-promotion commission; deemed distribution)	Finance Act 2025 (in force 1 July 2025 unless stated)
Digital content creator WHT (5%)	Finance Act 2023 (in force 1 July 2023)
Digital asset exchange/transfer WHT (3%)	Finance Act 2024 (in force 1 July 2024)
Tax authority	Tanzania Revenue Authority (TRA)
Treaty rates (dividends, interest, royalties caps)	Double tax treaties per TRA — Canada, Denmark, Finland, India, Italy, Norway, South Africa, Sweden, Zambia

Test Suite

Test 1 — Resident service fee. Input: resident provider, fee TZS 20,000,000. Expected: 5% × 20,000,000 = 1,000,000.

Test 2 — Non-resident service fee. Input: non-resident provider, fee TZS 20,000,000, no treaty. Expected: 15% × 20,000,000 = 3,000,000.

Test 3 — Dividend, resident individual (final). Input: dividend TZS 50,000,000. Expected: 10% × 50,000,000 = 5,000,000, final.

Test 4 — Dividend, resident controlling company (≥25%/≥25%). Input: dividend TZS 80,000,000. Expected: 5% × 80,000,000 = 4,000,000.

Test 5 — Mining technical fee, resident, post-FA2025. Input: TZS 100,000,000 paid 1 Aug 2025. Expected: 10% FINAL = 10,000,000.

Test 6 — Hired motor vehicle rent (FA2025). Input: TZS 12,000,000 paid 10 Sep 2025. Expected: 10% non-final = 1,200,000.

Test 7 — General royalty, non-resident. Input: TZS 30,000,000. Expected: 15% × 30,000,000 = 4,500,000.

Test 8 — Government goods. Input: TZS 40,000,000 to resident supplier. Expected: 2% × 40,000,000 = 800,000.

Test 9 — Insurance premium, non-resident (FA2025). Input: premium TZS 10,000,000 to non-resident insurer. Expected: 10% FINAL = 1,000,000 (resident insurer = 0%).

Test 10 — Digital asset transfer. Input: TZS 5,000,000 facilitated by a platform. Expected: 3% × 5,000,000 = 150,000, withheld by the platform owner/facilitator.

PROHIBITIONS

NEVER select a WHT rate without confirming the recipient's residency. NEVER apply a reduced treaty rate without a valid tax-residence certificate and beneficial ownership — default to the domestic non-resident rate. NEVER apply a service-fee rate to technical/management fees in mining, oil and gas without checking the FA2025 rate (resident 10% final, non-resident 15%) and the payment date. NEVER apply an FA2025 rate (hired-vehicle rent 10% non-final; mining/oil & gas technical 10% final; insurance premiums 10% final non-resident; gaming-promotion commission 10%; deemed distribution) to a payment made before 1 July 2025. NEVER treat WHT as final without confirming the recipient is a resident individual (and, for interest/rent, that it is not business income). NEVER omit the withholding agent's duty to remit within 7 days after month-end and file the monthly return by the 7th. NEVER ignore that an agent who fails to withhold is personally liable for the tax (ITA s.84(3)) plus interest and penalties. NEVER assume an exemption (SEZ/EPZ, strategic investor, ≥3-year bonds from 1 July 2021, specified government/inter-bank loans) without confirming eligibility. NEVER withhold on rent of other assets paid to a resident (0%); the 10% applies only to non-residents. NEVER present WHT calculations as definitive — always label as estimated and flag finality, treaty and exemption questions for the reviewer.

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