Business & VAT
VAT, levies and business maths
VAT in Tanzania is charged at 18% on most goods and services, and the same calculator works in both directions: adding VAT to a net price, or extracting the VAT already included in a gross one. Extracting is the case people get wrong — dividing a gross figure by 1.18 is correct, taking 18% off it is not.
The employer-side levies in this section, SDL and WCF, are paid by the business rather than deducted from staff, which is why they belong in cost calculations rather than payslip ones. The guides set out who pays each levy, on what base, and when.
The other business taxes here work on different bases, and using the wrong one is the usual error. Service levy is charged by the local government on a business's turnover, at a fixed 0.25% since the Finance Act 2025, on a base that excludes excise duty and VAT. Presumptive tax is a simplified income tax for small traders, banded by turnover rather than by profit. Withholding tax is not a separate tax at all: it is income tax or VAT collected in advance by the person making a payment, and it is credited against the recipient's own assessment. Depreciation, in this section, matters for tax because the Income Tax Act prescribes the classes and rates that a business may deduct.
Imports add a second layer of transaction taxes, and they stack in a fixed order. Import duty is charged on the CIF value, excise on CIF plus duty, the Industrial Development Levy on listed goods, the Railway Development Levy at 1.5% of CIF and the Customs Processing Fee at 1% of FOB. VAT is then 18% of the customs value plus every one of those charges, so a landed-cost estimate that applies VAT to CIF alone is too low.
Some of the tools deal with transactions rather than periodic taxes: registering a vehicle with TRA, transferring property, where stamp duty on the conveyance and capital gains tax on a disposal are separate charges that can both apply to the same deal, and importing goods or a vehicle, where the duty, levy and VAT cascade decides the landed cost.
Which calculator to use
Invoicing a customer
Use the VAT Calculator. It works in both directions — adding 18% to a net price, or extracting the VAT already inside a gross one — and names the direction in the result so an invoice line can be checked at a glance.
Working out what the business owes on its own turnover
Use the Service Levy Calculator for the 0.25% local government levy, and the Presumptive Tax Calculator if the business is a small trader: it applies TRA's turnover bands rather than a percentage, so the answer steps rather than scales.
Paying a supplier or a landlord
Use the Withholding Tax Calculator to see what must be withheld from a payment and what the recipient actually receives. The withholding guide lists which payments attract it and at what rate, including the cases where it does not apply.
Costing staff, or writing down equipment
The Employer Cost, SDL and WCF calculators cover the payroll-side levies; the Depreciation Calculator produces a schedule under the Income Tax Act classes, which is what a tax computation needs rather than a set of accounts.
A one-off transaction
Use the Property Transfer Calculator for stamp duty, capital gains tax and the exemptions TRA lists, and the Vehicle Registration Fees tool for what TRA charges to register or transfer a vehicle.
Importing goods or a vehicle
Use the Import Duty & Landed Cost Calculator for the whole cascade: duty on CIF, excise on CIF plus duty, the Industrial Development Levy, the 1.5% Railway Development Levy, the 1% processing fee and 18% VAT on the duty-inclusive value. Add clearing and transport to reach the landed cost.
Common mistakes here
- Taking 18% off a VAT-inclusive price to remove the VAT. The correct step is to divide by 1.18; subtracting 18% gives a lower net figure and a larger VAT amount than the invoice actually contains.
- Treating service levy as a percentage of profit. It is charged on turnover — 0.25% on a base that excludes excise duty and VAT — so a loss-making quarter can still carry a levy.
- Applying the SDL to a business with fewer than ten employees. The 3.5% levy applies from the tenth employee; below that it is not due, and the employer cost calculator reflects the threshold.
- Reading withholding tax as an extra tax on the recipient. It is a payment on account of their own liability, credited against the final assessment — the withholding guide sets that out, including the exemptions.
- Assuming capital gains tax and stamp duty cannot both apply. On a property sale they are separate charges: duty on the conveyance and CGT on the gain, with exemptions that apply to each separately.
- Charging import VAT on the CIF value alone. The VAT base also includes import duty, excise, the Industrial Development Levy, the Railway Development Levy and the processing fee, so the real VAT is higher than 18% of CIF.
Worked examples
Service levy on a quarter's turnover
A quarter's net turnover of 100,000,000 TZS attracts 250,000 TZS in service levy at 0.25% — that is 1,000,000 TZS if the same turnover repeats all year. The base is net turnover excluding excise duty and VAT.
Calculators
Tanzania Import Duty & Landed Cost Calculator
Work out Tanzania import duty, excise, IDL, railway levy, processing fee and 18% VAT on a CIF value, then add clearing and transport for the true landed cost.
Tanzania Property Tax Calculator
Work out Tanzanian stamp duty on a property transfer and the capital gains tax a seller owes — 10% resident, 30% non-resident, or 3% with no cost evidence.
Depreciation Calculator
Calculate depreciation by straight line, declining balance or sum of years' digits, or use Tanzania's Income Tax Act class rates for a tax allowance.
Tanzania Presumptive Tax Calculator
Work out Tanzania's presumptive (turnover) tax from annual turnover, with the flat annual rates for taxi, ride-hailing, tour and goods vehicles.
Tanzania Withholding Tax Calculator
Check the Tanzanian withholding tax rate for rent, dividends, interest, royalties, service fees and more, and the amount to withhold from a payment.
Tanzania Service Levy Calculator
Work out Tanzania's service levy at the fixed 0.25% rate on business net turnover, introduced on 1 July 2025 and paid quarterly to your local authority.
Tanzania Vehicle Registration Fees Calculator
What TRA charges to register a vehicle in Tanzania: the 250,000 registration tax, the licence fee by engine capacity, the HIV Response Levy and transfer fees.
Tanzania VAT Calculator
Free Tanzania VAT calculator: add or remove 18% VAT on any amount in TZS, showing the VAT amount and total. Accurate for invoices and pricing.
Tanzania SDL Calculator
Free Tanzania Skills Development Levy (SDL) calculator: work out the 3.5% employer levy on your monthly payroll. Fast and free, no sign-up.
Tanzania WCF Calculator
Free Tanzania Workers Compensation Fund (WCF) calculator: work out the 0.5% employer contribution on your monthly payroll. Fast, free, no sign-up.
Tanzania Employer Cost Calculator
Free Tanzania employer cost calculator: see the true cost of hiring staff with NSSF, SDL and WCF employer contributions. No sign-up needed.
Discount Calculator
Free discount calculator: find the final price after a percentage discount and see exactly how much you save. Great for sales and deals.
Percentage Calculator
Free percentage calculator: find what X% of a number is, what one number is as a percent of another, and percentage increase or decrease.
Tip Calculator
Free tip calculator for Tanzania: work out a 10% or 15% tip in TZS, check whether service charge is included, and split the bill per person.
Guides
Import Duty and Clearing Costs in Tanzania
Tanzania import duty, excise, IDL, railway levy, processing fee and 18% VAT: how the charges stack on a CIF value, and what landed cost really includes.
Tanzania VAT Explained (18%)
How Tanzania's 18% Value Added Tax works: adding VAT to a price, removing it, and when it applies — with a free VAT calculator.
Tanzania SDL and WCF Explained
What Tanzania's Skills Development Levy (3.5%) and Workers Compensation Fund (0.5%) are, who pays them and when — with a free employer calculator.
Tanzania HESLB Student Loan Deduction Explained
How the Tanzania HESLB 15% student loan deduction works: who it applies to, how much is taken from salary, and how to calculate your repayment.
Service Levy in Tanzania: the 0.25% Turnover Tax
The service levy is 0.25% of net turnover, paid quarterly to the local authority since July 2025: what it covers and how to work it out.
Presumptive Tax in Tanzania for Small Traders
How Tanzania's presumptive tax works for individual traders: the turnover bands, the flat transport rates, and the 12-month relief for a new business.
Withholding Tax in Tanzania: Rates and Rules
Tanzanian withholding tax by payment type: rent, dividends, interest, royalties and service fees, with the resident and non-resident rates and who remits.
Registering a Vehicle in Tanzania
What it costs to register a vehicle in Tanzania: the 250,000 registration tax, licence fees by engine capacity, the HIV Response Levy and transfer fees.
Depreciation Methods and Tanzania Tax Classes
How depreciation works by straight line, declining balance and sum of years digits, and the class rates Tanzania sets for the tax allowance.
Maintained by David M at Delta Tech Solutions · Figures last checked 22 October 2026 · Next check due 22 April 2027