Tax Treaties

Governments adopt different systems of taxing the incomes of their residents. Some systems base their right to tax on the source of income, and will tax all income earned in their territory. Others tax their citizens on the basis of their residence, and they will tax their residents on worldwide income.  Countries that base their right to tax on source of income are referred to as source taxation countries, while those that base their right to tax on residence are referred to as residence taxation countries.

Zambia is predominantly a source taxation country. According to section 14(a) of the Income Tax Act, all income received from a source within Zambia, or a source deemed to be within Zambia taxable. Section 14(b) further imposes tax on all interest and dividend income received by a Zambian resident from sources outside Zambia. Therefore, for interest and dividend income, Zambia bases its right to tax on residence basis.

When a resident of a residence taxation country engages in economic activity in a source taxation country, double taxation is likely to occur because both counties will claim the right to tax the same income. This situation would create a barrier for the international movements of capital and skills.

To overcome this barrier, countries sign bilateral tax treaties in order to share taxation rights on certain types of income but also to avoid fiscal evasion, i.e. where both source and residence countries fail to tax. Below is a list of tax treaties that Zambia has signed with other countries.

  1. The Zambia Botswana DTA
  2. The Zambia Canada DTA
  3. The Zambia Denmark DTA
  4. The Zambia Finland DTA
  5. The Zambia France DTA
  6. The Zambia Germany DTA
  7. The Zambia India DTA
  8. The Zambia Ireland DTA
  9. The Zambia Italy DTA
  10. The Zambia Japan DTA
  11. The Zambia Kenya DTA
  12. The Zambia Mauritius DTA
  13. The Zambia Norway DTA
  14. The Zambia Seychelles DTA
  15. The Zambia South Africa DTA
  16. The Zambia Sweden DTA
  17. The Zambia Switzerland DTA
  18. The Zambia Tanzania DTA
  19. The Zambia Uganda DTA
  20. The Zambia United Kingdom DTA

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