PAYE stands for Pay-As-You-Earn. It is a withholding tax of employees on taxable incomes in Tanzania and other countries. Under this system of PAYE, an employer is required by law to deduct income tax from an employee’s taxable salary or wages. How to Calculate TRA PAYE in Tanzania – PAYE Calculator

Monthly Income and Tax Rate

Resident Individuals Income TAX Rates with effects from July 2020-2021

  1. Where the total income does not exceed 270,000/=, Tax Rate – NIL
  2. Where the total income exceeds
    270,000/= but does not exceed Tshs. 520,000/= Tax Rate – 9% of the amount in excess of Tshs. 270,000/=
  3. Where the total income exceeds 520,000/= but does not exceed 760,000/= Tax Rate – Tshs. 22,500/= plus 20% of the amount in excess of 520,000/=
  4. Where the total income exceeds 760,000/= but does not exceed 1,000,000/= Tax Rate – Tshs. 70,500/= plus 25% of the amount in excess of 760,000/=
  5. Where the total income exceeds 1,000,000/= Tax Rate – Tshs. 130,500/= plus 30% of the amount in excess of 1,000,000/=

Note:

  • Threshold per annum: Annual Income of Ths 3,240,000/= is not taxable
  • For non-resident employees of a resident employer, the income, subject to withholding tax is the total income of a non-resident individual and is charged at a rate of 30%.
  • For an employee who makes a donation as per section 12 of education fund Act 2001, such donation is exempted from tax. However exemption is granted upon approval by the commissioner

TRA PAYE Calculator

Benefit in kind.

  1. Housing: Payment consisting of provision of premises by employer for residential by the employee:- Is the market value of rental of premises or (i) or (ii) below, whichever is the lesser
    i. 15% of the employees total annual income and ;
    ii. The expenditure claimed as deduction by the employer in respect of the premises during the year of income.
  2. Car: Motor vehicle taxable benefits are based of the engine size and vehicle age on the following annual values:
  • Engine size – Not exceeding 1000cc, Vehicle age up to 5 years Tsh. – 250,000/-, Greater than 5 years old Tsh. 125,000/-
  • Engine size – 1000 – 2000 cc, Vehicle age up to 5 years Tsh. – 500,000/-, Greater than 5 years old Tsh. – 250,000/-
  • Engine size – 2000 – 3000 cc, Vehicle age up to 5 years Tsh. – 1,000,000/-, Greater than 5 years old Tsh. – 500,000/-
  • Above 3000 cc, Vehicle age up to 5 years Tsh. -1,500,000/-, Greater than 5 years old Tsh. – 750,000/-

Note: Benefit is not chargeable where the employer does not claim deduction in respect of the ownership, maintenance, or operation of the vehicle.

3. Other benefits in kind: Market value will apply for quantification of other
benefits in kind.

How to Calculate TRA PAYE in Tanzania – PAYE Calculator

PAYE Calculator

Type your monthly pay after deducting PPF, NSSF or PSPF Contribution, Then click on the “calculate PAYE” button to find your monthly Income Tax payable.

Click Here To Calculate PAYE

For more information, please call the Toll free numbers;
0800-780078 or 0800-750075
Email: services@tra.go.tz

Author

I am a founder of electrotza.com, with a focus on covering important tech information and Tanzania Updates. Email: electrotza@gmail.com

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