The Zimbabwean Minister of Finance and Economic Development has reviewed local currency employment tax bands and tax rates with effect from 01 August 2023.
See our original post: Zimbabwe: Tax changes effective August 2023 (local currency)
Please take note of the Important information below if you have Zimbabwe payroll companies:
- New tax tables will be deployed on 16/08/2023 at 20:00 for Zimbabwe
- The USD tax tables remain unchanged
- The tax tables are affective from 1 August 2023 and not for the full tax year
- All changes will be applied in the current pay period and will affect Net Salaries
Follow the steps below before the deployment on 16/08/2023 to ensure that employees are taxed according to the correct tables:
Please follow the steps below in your Current Zimbabwe Company:
1. Create a backup of your company
2. Start a new pay period to August 2023
3. Copy the Company structure to a new number and access the new company. (On the Company Listing Page, select Manage Companies > Copy Company Structure)
4. Access the newly created company to ensure that it created correctly.
5. Transfer employees from current company to the new company using the following selections and input:
- From the Main Menu > Employee >Transfer Employee
- Transfer without YTD figures
- Transfer without Clear Payslip
- Termination Date = 31/07/2023
- Tax Year Start Date = 01/08/2023
- Retain existing Engagement Date and Service Periods
- Transfer From: (this will be the original Zimbabwe Company)
- Transfer To: (this will be the new Zimbabwe Company)
- Related article: How do I transfer employees between payrolls?
6. Clear the payslips for August in the current company (this will be in the original company).
- There might be a Tax difference in August because the employees were terminated for a previous month
- Decide how you want to handle the tax differences. (Refund to the employees; load it as additional tax to get a zero net salary effect; or load it as additional tax to get a zero Net Salary effect and then load the same values in the new company as additional tax)
7. Print a report with Tax values per employee
8. Print month end reports and create payment files if needed
9. Make a backup and roll the company with terminated employees to a new pay period to avoid any further tax calculations
Follow the steps below in your New Zimbabwe Company
10. Ensure that all Payslip values are correct
11. Do the input for August
12. If you decided to carry tax values over to the new company – capture the additional tax values.
Information regarding the changes will be available in the 'What’s New' document on the Subscription page, after the deployment.
Should you require any assistance with the process, please contact your Sage accredited Business Partner.