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Tanzania Capital Gains Tax Guide 2026

Tanzania imposes Capital Gains Tax (CGT) on the disposal of assets. For property, the rate is 20% for assets held less than 3 years and 10% for assets held more than 3 years. For shares in Tanzanian companies, residents are taxed at 10% and non-residents at 20%. The principal private residence is exempt from CGT.

Overview — Capital Gains Tax

Capital Gains Tax in Tanzania is governed by the Income Tax Act, Cap. 332. CGT is chargeable on gains arising from the disposal of assets, including land and buildings, shares, securities, and business assets. The tax applies to both residents and non-residents disposing of Tanzanian-situs assets. The gain is calculated as the difference between the disposal proceeds (or market value) and the adjusted cost base of the asset.

CGT Rates by Asset Type

  • Property (land and buildings) — 20% if held for less than 3 years; 10% if held for 3 years or more
  • Shares in Tanzanian companies (residents) — 10%
  • Shares in Tanzanian companies (non-residents) — 20%
  • Business assets (goodwill, intellectual property) — 20% (treated as ordinary income for traders)
  • Principal private residence — exempt from CGT

Principal Residence Exemption

The sale of a principal private residence (the taxpayer's main home) is exempt from CGT in Tanzania, provided the property was used as the primary residence throughout the ownership period. Partial exemption may apply if the property was used partly for business purposes or if the owner occupied only a portion of the property. The exemption applies to one property per individual at a time.

Calculation of Gain

The capital gain is calculated as:

Capital Gain = Disposal price − (Acquisition cost + Improvement costs + Disposal costs)

Allowable deductions include the original purchase price, costs of capital improvements, legal fees, valuation fees, and agent commissions on sale. The adjusted cost base may be indexed for inflation for properties held long-term, subject to TRA guidelines.

Filing and Payment

CGT is self-assessed and must be reported to TRA within 30 days of the disposal. Payment is due at the time of filing. The return is filed through the TRA online portal using the prescribed CGT return form. For property transactions, the CGT clearance certificate must be obtained before the transfer can be registered with the Ministry of Lands. TRA may impose an estimated assessment if the declared value is below the official minimum property valuation.

FAQs

Is CGT applicable to gifts?

Transfers of property by way of gift may be subject to CGT if the recipient is not a relative, based on the market value of the property at the date of transfer. Gifts to spouses and direct descendants may qualify for rollover relief.

How is CGT calculated on shares?

For listed shares traded on the Dar es Salaam Stock Exchange (DSE), CGT is 10% for residents. The gain is calculated as the difference between the sale price and the acquisition cost. DSE transactions may be subject to withholding of CGT by the broker.

Can capital losses be offset?

Yes, capital losses can be offset against capital gains in the same tax year. Unrelieved capital losses may be carried forward for up to 5 years to offset future capital gains. Losses cannot be offset against ordinary income.

Are foreign exchange gains on property taxed?

Yes, gains arising from currency fluctuations on foreign-owned Tanzanian property are included in the CGT calculation. The gain is computed in TZS at the date of disposal.

Disclaimer

This guide provides general information about Tanzanian capital gains tax for the 2026 tax year. Tax laws, rates, and regulations may change. Always consult with a qualified Tanzanian tax advisor or the Tanzania Revenue Authority for advice specific to your situation. InvestmentKit does not provide tax advice.

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