Withholding Tax in Tanzania 2026: Rates, Deadlines and Worked Examples
Every WHT rate you are likely to need (services, rent, interest, dividends, royalties, insurance, directors' fees and more) for resident and non-resident payees, with when to pay TRA and three calculations worked through.
Short answer: in Tanzania the payer deducts withholding tax (WHT) from the payment and pays it to TRA within 7 days after the end of the month in which the payment was made. The most common rates in 2026 are 5% on service fees paid to residents, 15% on service fees paid to non-residents, 10% on commercial rent paid to residents, 10% on interest and on most dividends, 5% on dividends from DSE-listed companies and 2% on goods sold to government. Rows marked * are ones where TRA's own publications disagree with each other, so confirm the rate before you rely on it.
Withholding tax rates in Tanzania, 2026
The table below follows the rate list on TRA's withholding tax page, cross-checked against TRA's Taxes and Duties at a Glance 2025/26 booklet and the Finance Acts 2025 and 2026. The Finance Act 2026 (in force from 1 July 2026) did not change any of the main rates in this table.
| Payment | Resident payee | Non-resident payee |
|---|---|---|
| Service fees (professional and other services) | 5% | 15% |
| Management and technical service fees, mining, oil and gas | 10% | 15% |
| Rent on land and buildings (commercial) | 10% | 10%* |
| Hire of motor vehicles | 10% | 10โ15%* |
| Rent on construction equipment or machinery | 10% | 10% |
| Aircraft lease | 10% | 15%* |
| Rent on other assets | n/a | 15%* |
| Interest | 10% | 10% |
| Interest on corporate or municipal bonds listed on the DSE | Nil | n/a |
| Dividends from DSE-listed companies | 5% | 5% |
| Dividends to a resident company holding 25% or more of the shares | 5% | n/a |
| Other dividends | 10% | 10% |
| Royalties (general) | 10โ15%* | 10โ15%* |
| Royalties for film, video or sound recordings | 10% | 10% |
| Royalties paid to a sports entity or the Tanzania Football Federation | 5% | n/a |
| Insurance premiums | n/a | 10% |
| Directors' fees (non-full-time directors) | 15% | 15% |
| Natural resource payments | 15% | 15% |
| Transport services by a non-resident operator or charterer with no permanent establishment | n/a | 5% |
| Goods supplied to government or its institutions | 2% | n/a |
| Minerals bought from a primary mining licence holder or artisanal miner; salt | 2% | n/a |
| Commission to mobile money agents, and to bank and digital payment agents | 10% | n/a |
| Commission for gaming advertising or promotion | 10% | n/a |
| Payments to resident digital content creators | 5% | n/a |
| Payments by digital asset exchange platforms to residents | 3% | n/a |
| Payments for verified carbon emission reductions | 10% | n/a |
| Sale of forest produce (single instalment) | 2% of gross | n/a |
| Employment income of a non-resident employee of a resident employer | n/a | 15% |
* Where the sources disagree. TRA's withholding tax web page lists rent at 10% for both residents and non-residents and royalties at 10% for both. The TRA Taxes and Duties at a Glance 2025/26 booklet instead shows rent on land and buildings paid to a non-resident at 20%, royalties paid to a non-resident at 15% and insurance premiums at 15%. PwC's Tanzania summary (reviewed September 2026) lists royalties at 15% for both and rent at 10% for both. For insurance premiums we print 10%, the rate the Finance Act 2025 introduced when it raised the rate from 5%. For any starred payment, especially rent or royalties paid abroad, get the rate confirmed in writing by TRA or your tax adviser before you pay.
Want to check one payment quickly? The withholding tax calculator works out the deduction and the net amount. Use the table above to choose the rate.
What withholding tax is, and who has to withhold it
Withholding tax is income tax collected at source. The withholding agent is the person making the payment. The agent keeps back a percentage of the payment and sends it to TRA. The withholdee is the person receiving the payment, and they get the net amount plus proof that tax was paid for them. TRA's guidance says WHT covers employment income, dividends, interest, natural resource payments, rent, royalties, service fees, contract payments and goods supplied to government and its institutions.
In practice, any business that pays rent for an office or shop, pays consultants, contractors or professional firms, pays interest on loans, declares dividends or pays foreign suppliers for services is a withholding agent. Being a small business does not exempt you. The tax is calculated on the gross payment, so you still owe it to TRA even if you paid the supplier in full and forgot to deduct it.
Two changes from recent Finance Acts catch people out:
- Residential rent paid by individuals. The Finance Act 2023 removed the obligation on individuals to withhold tax on residential rent, after the 2022 rule proved hard to apply. The 10% still applies to rent a business pays on commercial premises.
- Hired vehicles. Since the Finance Act 2025, payments for hiring motor vehicles carry 10% WHT. Fleet hire, car rental and transport-pool contracts are now included.
Separately, the Finance Act 2025 created withholding VAT: appointed withholding agents keep back 3% of the value of standard-rated goods and 6% of services. It sits on top of income-tax WHT and is reported in the VAT return, not the WHT return, so treat it as its own process.
How to calculate withholding tax in Tanzania: three worked examples
1. Office rent paid to a resident landlord
Your company rents an office for TZS 3,000,000 a month from a Tanzanian landlord.
- WHT at 10%: 3,000,000 ร 10% = TZS 300,000
- Paid to the landlord: TZS 2,700,000
- Paid to TRA: TZS 300,000, by the 7th of the following month
If you pay rent quarterly or yearly in advance, you withhold on the whole amount when you pay it. So a TZS 36,000,000 annual payment means TZS 3,600,000 goes to TRA in the month after payment. The lease should say clearly that the rent is subject to WHT. Otherwise landlords tend to expect the full amount.
2. Service fees paid to a resident consultant
A Dar es Salaam marketing consultant invoices you TZS 5,000,000 for a campaign. They are not VAT-registered, so no VAT is involved.
- WHT at 5%: 5,000,000 ร 5% = TZS 250,000
- Paid to the consultant: TZS 4,750,000
When the supplier is VAT-registered, firms usually apply WHT to the fee before VAT. Agree the base with your adviser and use it the same way every time.
3. A foreign supplier who insists on being paid "net"
A Kenyan software firm with no presence in Tanzania does work for you and wants to receive exactly TZS 5,000,000 after tax. The non-resident service fee rate is 15%, so you have to gross the payment up:
- Gross fee = 5,000,000 รท (1 โ 0.15) = TZS 5,882,353
- WHT at 15% = TZS 882,353
- Net to the supplier = TZS 5,000,000
The tax becomes your cost, not the supplier's. Foreign invoices are where most SMEs get caught out with WHT: if you forget to withhold, TRA can recover the 15% from you, and the supplier has already been paid in full. Where a double tax agreement covers the supplier's country, the treaty rate can be lower than the domestic rate, but you need the supplier's tax residence certificate before you apply it.
When and how to pay WHT to TRA
- Withhold when you pay. The obligation starts on the day you make the payment, not the date on the invoice.
- File the monthly WHT statement and pay the tax within 7 days after the end of the month. TRA's guidance says every withholding agent must pay the tax withheld to the Commissioner within seven days after the end of each calendar month. TRA's 2025/26 booklet gives the same deadline for the statement.
- Pay against a control number generated in the TRA taxpayer portal. You can pay through a bank or mobile money.
- Issue the WHT certificate. TRA says certificates are obtained under Tax Payment in the taxpayer portal and either side can print them once the payment has been made. Send it to the payee. It is their proof that the tax was paid for them.
WHT falls due on the same day as PAYE and SDL, the 7th. Our 2026 tax calendar and the SME tax compliance guide show how it fits with VAT on the 20th and the quarterly income tax instalments.
If you are late or forget. A withholding agent who fails to withhold, or withholds and does not pay, becomes liable for the tax as if it were their own, and also owes interest and penalties under the tax laws. This page does not quote the penalty amounts because we could not confirm them against the current law. Ask TRA or your adviser for the exact figures.
Final vs non-final withholding tax
The law sorts WHT into two types. TRA defines them as follows:
- Final WHT: the payee cannot claim a credit for it on their annual return. The tax withheld settles the payee's tax on that income.
- Non-final WHT: the payee can deduct the tax withheld from the income tax due for the year. It works like an advance payment.
Broadly, WHT on payments to non-residents without a permanent establishment, and on dividends and interest received by individuals, tends to be final. WHT on rent, service fees and similar business income received by Tanzanian companies and traders tends to be non-final. Those payees keep their certificates and claim the tax back against their annual liability. The Finance Act 2025 made WHT on management and technical services within mining, oil and gas a final tax at 10%. Whether a specific payment is final depends on the type of payee and on the section of the Income Tax Act, so check your own case. If you are the payee, the practical point is simple. Collect every certificate. A non-final credit you cannot prove is a credit you lose.
Common mistakes we see
- Withholding on the net amount. The rate applies to the gross payment. If you pay a supplier "net", gross the payment up as in example 3.
- Using a single rate for all rent. Rent on buildings, vehicles, machinery and aircraft is listed separately, and the non-resident rates may differ.
- Forgetting dividends. A company that declares dividends has to withhold before paying shareholders, including its own directors.
- No certificates. Suppliers chase certificates at year-end, and finding them later takes far longer than printing them when you pay.
- Treating WHT as optional for small invoices. The rate list has no small-payment exemption, so a TZS 200,000 consulting fee still carries 5%.
Keeping it under control
Most WHT errors come from the bookkeeping, not from the law. The supplier was set up with the wrong rate, or the payment went out from a mobile money account that nobody reconciled. If you already use Tawala Accounting, you can set the WHT rate on each supplier once. The deduction then shows on every payment voucher, and the month's total is ready for the return on the 7th. Whatever tool you use, the habit matters more than the software: decide the rate when you set up the supplier, not when you make the payment.
Sources: TRA, "Withholding tax" page (tra.go.tz/page/withholding-tax): rate list, 7-day deadline, certificates, final vs non-final definitions; TRA, Taxes and Duties at a Glance 2025/26 (section 2.0 and the filing calendar); PKF digest of the Finance Act 2025 (insurance premium 5%โ10%, hired vehicles 10%, extractive management/technical fees 10% final, withholding VAT 3%/6%); Clyde & Co summary of the Finance Act 2026; PwC Worldwide Tax Summaries, Tanzania withholding taxes (reviewed 9 September 2026); EY, Finance Act 2023 analysis (residential rent). Checked 24 October 2026.