ITF263 and withholding tax on supplier payments
Paying a supplier who doesn't have a valid tax clearance certificate (ITF263) usually means withholding tax from what you pay them and passing it to ZIMRA. The hard part isn't the deduction; it's knowing, at the moment of payment, whose certificate is still valid.
What to keep for each supplier
- Their ITF263 number and its expiry date.
- Whether they are exempt, and why.
- Whether they are a non-resident digital service provider, which has its own rate and mechanism.
At the point of the invoice
When a supplier invoice arrives from someone without valid clearance, the withholding should be deducted automatically: it reduces what you owe the supplier and becomes a liability to ZIMRA. Payroll isn't withheld this way.
Rates and thresholds are set by law and change. Confirm the current ones with your accountant.
Staying ahead of expiry
Certificates expire. A list of suppliers with missing, expired or soon-to-expire certificates, checked monthly, saves both the deductions and the awkward phone calls.
This guide explains general practice. It isn’t tax or legal advice: confirm rates and choices with your accountant or payroll adviser.