Reminder on final deduction system: Year-end procedures

End of year adjustments

• Employers are expected to reconcile their payrolls and ensure the correct tax is collected per employee by end of the year.
• At the end of the year, the employer must make final adjustments to Pay As You Earn (P.A.Y.E.) calculations taking into account the total income, deductions, and credits to which the employee is entitled.
• In the case of shortfalls, the employer is obliged to make good the shortfalls, remit the tax, and recover the shortfalls from employees on the final payroll. Where there are refunds employers should also refund the employees on the final payroll for the year.

The employer should then extract the ITF 16 Return and submit to ZIMRA by January 31, 2019.

The following e-mail addresses should be used to submit the ITF16 Returns:

• [email protected]
• [email protected]
• [email protected]
• [email protected]
• [email protected]
• [email protected]
• [email protected]
• [email protected]
• [email protected]
• [email protected] Issue of Tax Certificates
• All employees whose remuneration was subject to P.A.Y.E. are entitled to be issued with tax certificates (forms P6) for their records.
• The employer is required to issue forms P6 within 30 days from the end of the relevant year or within 30 days of terminating employment services as the case may be.
• Forms P6 for the employees who are employed by the same employer for the full tax year should be marked F.D.S. on the face.

Submission of Income Tax Returns (FORMS ITF 1

All those employees who:-

1. Terminate employment during the year of assessment;
2. Change employment during the year;
3. Work part time at the same time being fully employed by another employer;
4. Start employment during the course of the year;
5. Receive pensions;
6. Are executors/ executrix of deceased estates and
7. Are in receipt of income which is not subject to P.A.Y.E.
8. Are required to submit (FORMS ITF 1).
9. The Commissioner General of ZIMRA will notify all employees who are required to submit ITF 1 return by notice in the press. This notice is usually published in first quarter of each year.

Who should not submit returns of Income Tax Returns?
All those employees whose income consists of employment income only and whose employer was directed to administer P.A.Y.E. under the Final Deduction System (F.D.S.) system and did so during the year concerned, and the employee was in continuous employment with the same employer for the whole year.

This article was compiled by the Zimbabwe Revenue Authority for information purposes only. ZIMRA shall not accept responsibility for loss or damage arising from use of material in this article and no liability will attach to the Zimbabwe Revenue Authority.   

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