Zambia

Payments of the following items of Zambian-source income may be subject to WHT. The relevant rates under domestic legislation are as follows:

Notes

1. 0% if paid by a mining company. 
2. Interest payable to local banks and financial institutions licensed under the Banking and Financial Services Act, 2017 is exempt from WHT. In addition, interest paid by a bank or an institution registered under the Banking and Financial Services Act, 2017 in respect of interest earning accounts held by individuals is exempt from WHT.
3. 0% if paid by a company listed on the Lusaka Securities Exchange to individual shareholders. 

Zambia's WHT obligations are triggered by the earliest of the payment date, the accrual date, or when income becomes due or is held for a person's order. In the context of rental income, the Commissioner-General may designate tenants as WHT agents, requiring them to withhold tax on rental payments for leased properties.

WHT payments must be remitted within 14 days after the month in which the payment or accrual occurred. Additionally, Zambia has DTTs with various territories, offering reduced WHT rates on dividends, interest, and royalties to non-residents.

Zambia has DTTs in force with the following territories:

Notes

1. The non-resident recipient must own at least 25% of the share capital of the capital of the Zambian company.
2. The rate of 5% shall apply where the beneficial owner is a company that directly holds at least 10% of the capital of the company paying the dividends, or if the beneficial owner is a pension fund.
3. The 1950 France - Zambia DTT is accepted to apply.
4. The 1953 Rhodesia & Nyasaland - South Africa DTT is expected to apply. These old treaties do not follow the OECD model, and, accordingly, their application to particular circumstances must be confirmed.
5. The rate of 8% shall apply in the case of payment of royalties in respect of any copyright of scientific work, patent, trademark, design or model, plan, secret formula or process, or information concerning industrial, commercial, or scientific experience.
6. This rate applies where the dividends are paid out of income (including gains) derived directly or indirectly from immovable property within the meaning of Article 6 of the treaty.
7. The rate of 5% shall apply where the beneficial owner is a company (other than a partnership) that directly holds at least 10% of the capital of the company paying the dividends or if the beneficial owner is a pension fund.

In all cases, advance clearance must be obtained to obtain the treaty benefit and take advantage of any reduced rate of WHT or tax exemption.

It may be possible to obtain confirmation that management and consultancy fees can be paid without deduction of WHT by reference to the provisions of the relevant treaty. For treaties following the OECD model, the article concerning ‘Business Profits’ is generally taken to be relevant.