Zimbabwe Investment Income Guide 2026
Investment income in Zimbabwe is taxed primarily through withholding tax at source. Dividends paid to residents are subject to 10-15% WHT. Interest is taxed at 10% WHT. Royalties are taxed at 10% WHT. Capital gains on securities are subject to 5% CGT.
Dividend Taxation
Dividends paid by Zimbabwean companies are subject to withholding tax at the following rates:
- Resident individuals: 10% WHT on dividends from domestic companies (final tax)
- Resident companies: 10% WHT (withholding tax is creditable against CIT)
- Non-residents: 15% WHT (subject to reduction under applicable DTAs)
For example, a resident individual receiving ZWL 100,000 in dividends receives ZWL 90,000 net, with ZWL 10,000 remitted to ZIMRA as final tax.
Interest Taxation
Interest income from various sources is subject to withholding tax as follows:
- Bank deposits: 10% WHT (final tax for individuals)
- Corporate bonds: 10% WHT
- Government securities: Interest on Zimbabwean government bonds and Treasury bills may be exempt from tax in certain cases
- Non-residents: 10% WHT (or lower treaty rate)
The withholding tax is deducted by the paying institution at the time interest is credited or paid.
Royalty Taxation
Royalties paid for the use of intellectual property, patents, trademarks, copyrights, and similar rights are subject to withholding tax at 10% for both residents and non-residents. Treaty relief may reduce this rate for non-residents. The withholding tax is a final tax for non-residents and creditable for resident companies.
Capital Gains on Securities
Capital gains from the sale of shares and securities listed on the Zimbabwe Stock Exchange (ZSE) are subject to 5% CGT. This is a preferential rate compared to the 20% CGT on property. The gain is calculated as the selling price minus the acquisition cost and allowable incidental costs.
FAQs
Is rental income considered investment income?
No, rental income is classified as property income and is taxed as part of total income under the PAYE system (see the rental income guide for details).
Are foreign dividends taxable in Zimbabwe?
Zimbabwean tax residents must declare foreign dividend income in their annual return. A foreign tax credit may be available for taxes paid in the source country.
Can I reclaim excess withholding tax?
Yes, if tax has been withheld at a rate higher than the applicable treaty rate, the taxpayer may apply to ZIMRA for a refund.
Disclaimer
This guide is for informational purposes only and does not constitute tax advice. Consult a qualified Zimbabwean tax professional for advice specific to your circumstances.