Zimbabwe payroll: PAYE, NSSA, NEC, ZIMDEF and pay in two currencies
Payroll in Zimbabwe means getting several statutory amounts right every month, in one or two currencies, and filing the returns that go with them. Here is what is involved. Rates change with each budget, so none are quoted here: confirm the current ones with your payroll adviser.
What comes off pay
- PAYE: income tax on employment income, worked out on ZIMRA's tax tables, with separate treatment for FDS and non-FDS employees.
- AIDS levy: a percentage of the PAYE.
- NSSA: pension and other contributions on insurable earnings up to a ceiling, from employee and employer.
- NEC: contributions set by your industry's National Employment Council, from employee and employer.
- ZIMDEF: an employer's levy for manpower development (the Standards Development Levy).
- Medical aid, loans and other agreed deductions.
Pay in USD and ZWG
Under ZIMRA's method, someone paid in both currencies is taxed once on the whole salary using the USD tables, with the ZWG part converted at the period's rate. The PAYE and AIDS levy are then shared between the currencies, and each part is paid in its own currency. NSSA has one ceiling for the whole salary.
The law leaves some choices to the employer, such as how the tax is shared and how the bonus exemption applies to staff paid all in ZWG. Agree these with your adviser, record who signed them off, and keep them the same until you agree a change.
Returns and records
- PAYE returns for FDS and non-FDS employees, and P2 summaries.
- NSSA P4, ITF16 at year end, NEC returns and the SDL return.
- Payslips, and a payroll journal that agrees with gross pay plus the employer's costs.
- Use the current official templates: ZIMRA issues its own through the TaRMS portal, and they change.
Leave and the Labour Act
Leave entitlements follow the Labour Act, including sick and maternity leave. Unpaid leave reduces pay; leave owed carries over; and someone leaving is paid their leave, notice and any agreed severance in their final payroll.
When the budget changes the rates
New rates should take effect only after a qualified person approves them, and only from the right payroll. A record of who approved what, and when, protects the business at audit.
This guide explains general practice. It isn’t tax or legal advice: confirm rates and choices with your accountant or payroll adviser.