Auditax International tax compliance services in Tanzania include preparation and filling of statement of estimated tax payable and final tax returns as well as assisting companies to keep track on filling and tax payments deadlines and processing tax clearance certificates.
We also assist companies in handling tax audits by TRA, corresponding with TRA and responding on tax findings and tax assessments. We also prepare tax objections and tax appeals for clients on tax assessments issued by TRA and represent clients on meetings with TRA including on tax objections and tax appeals.
For tax compliance in Tanzania a Multinational Enterprise may have both income from business and income from investment. Income from investment refers to income from investments which are not related to a company’s business (e.g. rent, interest etc.). A company’s total income sourced in Tanzania will be taxed at a rate of 30%. Total income is calculated as a sum of income from business and income from investment less allowances, expenses and losses.
Expenses are allowable only to the extent that they were incurred wholly and exclusively in the production of income. Generally, expenditures that are capital in nature are not allowable for deduction but instead the income tax law allows deduction of depreciation allowance on ‘depreciable assets’ the annual rate of which is dependent on the class of capital expenditure. Depreciation allowances are allowed in respect of depreciable assets.
A depreciable asset is an asset employed wholly and exclusively in the production of income of a business, which has a benefit to the business lasting more than one year, and which is likely to lose value because of wear and tear, obsolescence or the passing of time. For tax purposes depreciable assets are categorized into eight classes (refer to our Tax Guide on this website).
Corporations are required to account for income and expenditure on an accrual basis (generally, this means account for payments when the right to receive them is created, not when the payment actually changes hands).Income tax is paid on income derived in a particular year of income. Normally, the year of income is from the beginning of January to the end of December. If a company wishes, it may apply to the tax authority to have a different year of income.
Statement of Estimated Tax Payable:
In Tanzania a company must file an estimate of its tax payable for the year (previously called a provisional return). This means the company should estimate the amount of tax it expects to pay during the year of income (which will be based on its estimate of its total income for the year). The estimated tax payable is then payable by quarterly instalments (by end of the quarter) to the tax authority. A company’s estimate may not always be accurate due to unforeseen events and it may realize this during the year. If so, the company may adjust or revise its estimate at any point during the year.
A final return is due for filing within six months after the end of the year of income. Auditax International tax services in Tanzania include preparing and filling statement of estimated tax payable and final tax return with TRA.