Zambia

Individual - Deductions

Last reviewed - 14 February 2020

Employment expenses

An expense is deductible against taxable emoluments if it is incurred wholly and exclusively for the purpose of that source of income and is not capital in nature. This test is difficult to satisfy in practice where an expense is incurred by an employee. Capital allowances may be available in limited circumstances.

Personal deductions

Alimony

Alimony payments are not deductible.

Charitable contributions

A payment to a public benefit organisation that is approved by the Zambian government or owned by the Zambian government is deductible. The maximum amount deductible is 15% of taxable income.

Mortgage interest expenses

Mortgage interest is not deductible.

Taxes paid

Zambian taxes paid are not deductible. See the Foreign tax relief and tax treaties section for a description of the treatment of foreign taxes.

Standard deductions

There is no standard deduction.

Personal allowances

There are no personal allowances. However, as set out in the rate table (see the Taxes on personal income section), the first ZMW 39,600 of taxable income (excluding taxable lump sum payments from approved pension funds, gratuities, and compensation for loss of office) is subject to income tax at 0%.

Business deductions

Business expenses are generally deductible, provided that they are not capital and they are incurred wholly and exclusively for the purposes of the business.

Losses

Losses can be carried forward for set-off against profits of the same source. Normally, losses are available to carry forward for a period of five years after the charge year in which the loss was incurred. In the case of a person carrying on a mining operation or hydro, solar, wind, and thermo power generation, the loss carryforward period is ten years.

There is no ability to carry back losses.

Losses from one source cannot be set against income from another source.