PAYE (Pay As You Earn) is a method of paying Income Tax on remuneration. Employers deduct tax from salary or pension earnings before paying out net salary.
This article provides a simple introduction to basic principles of VAT, PAYE, and Income Tax as they apply to employees and businesses.
The Income Tax Act specifies what elements of employee remuneration are subject to tax, at what rate, what income is exempt, and what deductions are allowed.
Everything you earn - cash, benefits, or items of value given instead of cash - is subject to some form of tax.
The tax table operates on a progressive rate system - the higher your earnings, the greater percentage tax you pay on each bracket.
Employers are required to operate PAYE as part of their payroll, deducting Income Tax and National Insurance contributions from employees' wages.
VAT is a consumption tax on goods and services in Zimbabwe. Registered businesses charge VAT on taxable supplies (output tax) and claim back VAT on business purchases (input tax).