ZAMBIA REVENUE AUTHORITY

UNOFFICIAL CONSOLIDATION OF THE

PROPERTY TRANSFER TAX ACT

2016 EDITION
(Includes amendments up to 31st December 2015)
PREFACE

This is not an authoritative publication and accordingly cannot be quoted as authoritative

in any legal proceedings. The italic explanations in parenthesis which follow amended
sections will enable the reader to follow the course of the various amendments which have
been introduced by the amending Acts. This consolidation has been produced by the
Zambia Revenue Authority for the use of its employees

Whilst incorporating amended enactments, the Consolidated Act does not show repealed
sections of the Act. It should be noted that certain new provisions were inserted and came
into operation at certain dates, not particularly relevant to certain year’s assessment, but
applicable generally and such provisions are described as having come into operation on a
specified date.

Where no effective date is mentioned the date is 1st April, 1984, the date of commencement
of the Act or deemed to have come into operation on 1st April, 1984, by the subsequent
amended Acts. The revised arrangement of sections is in accordance with the Revised
Edition of the Laws of the Republic of Zambia which came into force in 1995.

This edition of the consolidation of the Act includes statute law in force for the charge
year -2016.

LUSAKA Berlin Msiska

February 2016 Commissioner – General.
THE PROPERTY TRANSFER TAX ACT

CHAPTER 340 OF THE LAWS OF ZAMBIA

ARRANGEMENT OF SECTIONS

Section
1. Short title and commencement
2. Interpretation
3. Functions and powers of Commissioner
4. Property transfer tax
5. Realised value
6. Exemptions
7. Liquidators, receivers, trustees in bankruptcy etc.
8. Transfer by agents, mortgages etc.
9. Returns, notices, etc.
9A. Penalties under the Income Tax Act to apply
10. Objections and appeals
11. Payment of tax and penalty for late payment
12. Recovery of tax
12A. Tax Information Exchange Agreements and Mutual Assistance in Tax Matters
13. Regulations

CHAPTER 340

SCHEDULE OF AMENDING ACTs

Act No.
12 of 1984
4 of 1986
11 of 1987
28 of 1990
4 of 1994
4 of 2002
3 of 2005
4 of 2009
13 of 2012
14 of 2013
9 of 2014
An Act to provide for the charging and collection of a tax based on the value
realised from the transfer of certain property in the Republic; and to provide for
matters connected with or incidental to the foregoing.
[30th March 1984]
1. This Act may be cited as the Property Transfer Tax Act, and Short title and
commencement
shall come into operation on the 1st April 1984.

2. (1) In this Act, unless the context otherwise requires- Interpretation

"Commissioner-General" means the Commissioner-General Cap. 321

appointed under the Zambia Revenue Authority Act;

"immediate family" means a spouse, child, duly adopted child or

step-child;

"land" includes any building, structure or other improvement

thereon;

"person" includes a partnership;

“group of companies” means a holding company together with

all its subsidiaries;

“holding company” means a company that-

(a) holds the majority of the voting rights in another
company;

(b) is a member of another company and controls a majority

of the voting rights on its own or pursuant to an
agreement entered into with other members; or

(c) is a member of another company and controls, and has

the right to appoint or remove a majority of the board of
directors in that company;

“mining right” has the meaning assigned to it in the Mines and Mines and
minerals
Minerals Development Act, 2015; Development
Act 2015
“property” means-
(a) any land in the Republic
(b) any share issued by a company incorporated in the
republic; or
(c) a mining right issued under the Mines and Minerals
Development Act, 2015, or an interest therein.
"realised value" means the value, as calculated in accordance
with the provisions of section five, of any property liable to tax;
Cap. 185
"Registrar" shall have the meaning assigned thereto in the Lands
and Deeds Registry Act and includes the Registrar of
Companies;

"share" includes any stock or any certificate or warrant relating

to any share or stock;

"tax" means the property transfer tax charged under this Act;

"transfer"-
(a) in relation to land, excludes-
(i) letting or sub-letting;
(ii) leasing, under-leasing or sub-leasing, for a period of
less than five years;

(b) in relation to a share, excludes the allocation of the same

by the company to the member in whose name it is first
registered.

(2) Unless the context otherwise requires, words and expressions not
Cap. 323
defined in this Act but defined in the Income Tax Act shall, in
this Act, have the meaning assigned thereto in the Income Tax
Act.
(As amended by Act No.4 of 2002 and Act No. 3 of 2005)
3. (1) The Commissioner-General shall, subject to the direction of the Functions and
powers of
Minister, be responsible for giving effect to the provisions of this Commissioner.
Act, and shall for that purpose have all the powers conferred on Cap. 323
the Commissioner-General by the Income Tax Act.

(2) The Commissioner-General may, in writing and subject to such

conditions as the Commissioner-General specify, delegate to the
Commissioner or to any officer in the Domestic Taxes Division
any power conferred, or any duty imposed, on the Commissioner
by this section
(As amended by Act No.4 of 2002)

4. (1) Whenever any property is transferred, there shall be charged Property transfer
tax
upon, and collected from, the person transferring such property a
property transfer tax in accordance with the provisions of this
Act.

(2) The rate of tax is

(a) ten per cent of the realised value in respect of a mining
right;
(b) five per cent of the realised value in respect of land; and
(c) five per cent of the realised value in respect of shares.

(3) For the purpose of establishing the taxable value of transactions,

the Commissioner-General may use assessments done by the
Government Valuation Department or any other relevant
organisation he considers expedient.
(As amended by Acts 4 of 1984, 28 of 1990 , 4 of 1994, 13 of 2012,
and 14 of 2013)

5. (1) Where the property to be valued is land, the realised value shall Realised value
be the price at which it could, at the time of its transfer,
reasonably have been sold on the open market as determined by
the Commissioner-General.

(2) Where the property to be valued is a share, the realised value

shall be the price at which it could, at the time of its transfer,
reasonably have been sold on the open market as determined by
the Commissioner-General or its nominal value, whichever is the
greater:

Provided that the Commissioner General, in determining the

realised value for shares, may make adjustments in accordance
with the provisions of sections 97A, 97AA, 97C and Paragraph
22A of the Fifth Schedule to the Income Tax Act.

(3) Where the property to be valued is a mining right or an interest

in a mining right, the realised value of the mining right or
interest shall be the actual price of the mining right or interest or
as determined by the Commissioner General, whichever is
higher.

(4) Where the Commissioner-General determines that there has been

unreasonable delay between the date on which the property is
sold and the date on which it is transferred, and that as a result of
such delay the value of the property is different at the two dates,
the realised value of such property shall be the greater of the two
values.

(5) Where a person transfers his property to a member of his

immediate family, the realised value of such property shall be
the actual price, if any, received therefor by such person.

(6) Where, within a group of companies whose holding company is

incorporated in Zambia, a company transfers property to another
company (other than a company which is not resident in the
Republic) within the same group and the Commissioner-General
is satisfied that such transfer was carried out for the purpose of
effecting internal organisation of that group, he may determine
that such transfer shall have no realised value.
(Amended by Act No. 4 of 2009, 13 of 2012 and 9 of 2014)

6. (1) The following shall be exempt from the provisions of this Act Exemptions

(a) the Government;

(b) any foreign government;

(c) such international organisation, foundation or agency as the

Minister may approve for the purpose;
Cap. 323
(d) any public benefit organisation or trust listed as such under the
Income Tax Act;
Cap. 397
(e) any co-operative society registered under the Co-operative
Societies Act;
Cap. 323
(f) the organisations listed in paragraphs 5 (1) and (2) of the Second
Schedule to the Income Tax Act;

(g) any transfer of property by a shareholder of a company

incorporated under the Companies Act, if such transfer is his
contribution towards the equity of that company.

(2) Where property held in trust or constructive trust is transferred to

another person to hold in trust or constructive trust for the same
beneficiaries, such transfer shall not be liable to tax.

(3) Where property is settled in trust for the benefit of a member of

the immediate family of the settler, the transfer of such property
to the trustees or the transfer by the trustees to such beneficiary
shall not be liable to tax.

(4) Where property devolves upon death, the resulting transfer of

such property shall not be liable to tax if the transferee is a
member of the immediate family of the deceased; nor shall any
intermediate transfer to or by an executor, administrator,
personal representative or other person acting in similar capacity
be liable to tax if such intermediate transfer is carried out to give
effect to such devolution.

(5) The Minister may, by statutory order, exempt from tax any
person, transfer or property, or any class thereof.
(As amended by Acts No. 11 of 1987 and 14 of 2013)

7. (1) Any transfer of property to a person in his capacity as a Liquidators,

receivers,
liquidator shall not be liable to tax. trustees in
bankruptcy etc.
(2) Where a person in his capacity as a liquidator holds any property
belonging to a debtor, any transfer of such property by him to
any person other than the debtor shall be liable to tax and the
amount of such tax shall be recoverable from the liquidator

(3) In this section-

"debtor" includes a bankrupt or other person whose property has

been placed in the hands of a liquidator for the purpose of
settling the affairs or debts of such debtor, and in the case of a
company, for the purpose of winding up such company;

"liquidator" includes receiver, trustee in bankruptcy, assignee in

bankruptcy or under a deed of arrangement, or any other person
acting in a similar capacity

8. (1) Where a mortgagee transfers any mortgaged property to enforce Transfer by

agents,
his rights under a mortgage, the mortgagee shall be deemed to be mortgagees, etc.
an agent of the mortgagor and subsection (2) shall apply.

(2) Where an agent, attorney, sheriff, or other person acting in the

name of the owner or holder of any property transfers such
property, the owner or holder of such property and such agent,
attorney, sheriff or other person, as the case may be, shall both
be jointly and severally liable for tax in respect of such transfer.

(3) In this section "mortgagee" includes any person entitled to

security in any property, or to the benefit of a charge,
encumbrance or other similar liability over any property, of
another, and "mortgage", "mortgagor" and "mortgaged property"
shall be construed accordingly.

9. (1) Every person who transfers any property, whether such property Returns, notices,
etc.
was transferred on his own behalf or on behalf of another, shall
render a provisional return of tax in such form and giving therein
such details of the property and the transaction as may be
prescribed by the Commissioner-General.
(2) The provisional return referred to in subsection (1) shall be
submitted-

(a) in the case of land, to the Commissioner of Lands together with

the application for consent to transfer such property;

(b) in all other cases, to the Commissioner-General within thirty

days of the transfer.

(3) The Commissioner of Lands shall satisfy himself that the details
given in the provisional return received by him under sub-
section (2) are correct and shall thereafter forward it to the
Commissioner-General.

(4) The Registrar shall not register any transfer of property unless he
is satisfied that any tax due under this Act in respect of such
transfer has been paid.

(5) Notwithstanding any other written law, the minister responsible

for mines, the Director of mines or the Director of Geological
Survey, as applicable, shall not approve the transfer, assignment,
encumbrance or other dealing with a mining right or interest
therein, if the transferor fails to pay the tax due in respect of the
transfer, assignment, encumbrance or other dealing with a
mining right or interest therein under this Act.

(6) Without prejudice to the other provisions of this Act, sections Cap. 323
forty-five, forty-six, forty-seven, forty-eight, fifty-seven, fifty-
eight, sixty-six, sixty-nine and seventy of the Income Tax Act
shall apply, mutatis mutandis, in relation to the tax under this
Act as they apply in relation to the tax under the Income Tax
Act.
(As amended by Act No. 13 of 2012)

(7) An assessment shall be made in respect of every person liable to

tax under this Act, and sections sixty-three to sixty-nine (inclusive) of
the Income Tax Act shall apply, mutatis mutandis, in relation to the
assessments under this Act as they apply in relation to the assessments
under the Income Tax Act.

9A. Subject to the other provisions of this Act, the provisions of Part Penalties under
Income Tax Act
X of the Income Tax Act relating to offences and penalties shall to apply.
apply, with necessary changes, to the offences and penalties Cap. 323
under this Act.
(As amended by Act No. 11 of 1987)
9B. (1) Where the Commissioner General has reasonable grounds to
believe that the main purpose or one of the main purposes for
which any transaction was effected was the avoidance or
reduction of liability to tax for any charge year, or that the main
benefit which might have been expected to accrue from the
transaction within the three years immediately following the
completion thereof, was avoidance or reduction of liability to
tax, the Commissioner General may, if the Commissioner
General determines it to be just and reasonable, direct that such
adjustments shall be made as respects liability to tax as the
Commissioner General considers appropriate to counteract the
avoidance or reduction of liability to tax which would otherwise
be effected by the transaction.

(2) Without prejudice to the generality of the powers conferred by

subsection (1), the powers conferred thereby extend to –

(a) the charging with tax the persons who, but for the adjustments,
would not be chargeable to the same extent: and

(b) the charging of a greater amount of tax than would be chargeable

but for the adjustments.

(3) Any direction of the Commissioner-General under this section

shall specify the transaction giving rise to the direction and
adjustments as respects liability to tax which the Commissioner
General considers appropriate.

10. Any determination or assessment made under this Act may be Objections and
Appeals Cap.
objected to or appealed against by the person affected thereby; 323
and without prejudice to the other provisions of this Act, the
provisions of Part XI of the Income Tax Act relating to
objections and appeals shall apply, mutatis mutandis, in relation
to objections and appeals under this Act as they apply in relation
to objections and appeals under the Income Tax Act.

11. (1) The tax shall become due and payable within fourteen days of Payment of tax
and penalty for
the date of issue of the assessment in respect thereof. late payment

(2) Where any amount of tax is not paid within the period specified
in subsection (1), a penalty equal to five per centum of the
unpaid amount shall be charged for each month or part thereof
for which the tax remains unpaid; and for the purposes of
recovery and collection such penalty shall be deemed to be part
of the tax.
(3) (a) Where any amount of tax or penalty due is not paid within the
period specified in sub-section (1), such an amount shall attract
interest at the rate prescribed in paragraph (b) and shall continue
to attract such interest until such date as the payment of the tax
has been remitted;

(b) the rate of interest prescribed for the purpose of paragraph (a)
shall be the discount rate published from time to time by the
Bank of Zambia plus two per centum per annum.
(As amended by Act No. 4 of 1994)

12. Subject to the provisions of this Act, sections seventy-nine, Recovery of tax.
Cap. 323
seventy-nine A, seventy-nine B, seventy-nine C and seventy-
nine D of the Income Tax Act shall apply, mutatis mutandis, to
the recovery of tax under this Act as they apply to the recovery
of tax under the Income Tax Act.

12A(1) The president may enter into an agreement which may have Tax information
exchange
retrospective effect, with the Government of any other country agreements and
or territory for the exchange of information on tax matters or for mutual
mutual assistance in tax matters with the objective of rendering assistance in tax
matters.
reciprocal assistance in the –

(a) provision of data on fraud, civil and criminal tax offenses;

(b) administration and collection of taxes under the property
transfer tax laws of the Republic and such other country or
territory;
(c) carrying out of tax examinations in Zambia or abroad; and
(d) carrying out of simultaneous or joint examinations

(2) Any information received by a country or territory under an

agreement entered into under subsection (1) shall be treated as
secret in the same manner as information obtained under the
domestic laws of the country or territory and shall be disclosed
only to persons or authorities involved in the assessment,
collection enforcement, prosecution or determination of appeals
in relation to, the taxes under this Act.

(3) Subsection (1) shall not be construed so as to impose on a

country or territory the obligation to-

(a) carry our administrative measures at variance with the laws and
administrative practices of that country or territory;

(b) supply information which is not obtainable under the laws of

Zambia; or
(c) supply information which would disclose any trade, business,
industrial, commercial or professional secret or trade process, or
information, the disclosure of which would be contrary to public
policy

(4) The minister shall lay a copy of an agreement referred to in

subsection (1) before cabinet for approval.

(5) The president shall, as soon as practicable after the conclusion

and approval of any agreement under this section, notify the
public of the terms of the agreement by statutory instrument, and
the agreement shall, from the day of commencement of the
statutory instrument, have effect as if enacted under this Act as
long as the agreement has the effect of law in the other country
or territory.
(Amended by Act No. 13 of 2012)

13. The Minister may, by statutory instrument, make regulations for Regulations
the better carrying out of the purposes of this Act.

SUBSIDIARY LEGISLATION

SECTION 6 - THE PROPERTY TRANSFER TAX (EXEMPTION) ORDERS

Statutory Instrument 104 of 1993

1. This Order may be cited as the Property Transfer Tax (Exemption) Order.

2. There shall be exempt from tax under the Act any instrument entered into, granted
or issued in connection with the exchange, transfer, sale or other disposal of any
stock or share listed by any stock exchange licensed under the Securities Act, and
traded through a licensed Securities Market.

Statutory Instrument No. 50 of 1997

1. This Order may be cited as the Property Transfer Tax (Exemption) Order.

2. The Zambia Venture Capital Fund Limited shall be exempt from paying any tax
under the Act for any transfer of shares by Zambia Venture Capital Fund Limited.
Statutory Instrument No. 68 of 2009

1. This Order may be cited as the Property Transfer Tax (Exemption) Order, 2009
2. The Transfer of assets from former Kariba North Bank Company to ZESCO
Limited shall be exempt from property transfer tax.

Statutory Instrument No. 69 of 2009

1. (1) This Order may be cited as the Property Transfer Tax (Exemption) (no. 2)
Order, 2009.
(2) This Order shall be deemed to have come into effect on 6th June 2009.
2. The Transfer of ordinary shares in Luanshya Copper Mines Plc by Enya Holdings
B. V. to China Non-Ferrous Metals shall be exempt from property transfer tax.

Statutory Instrument No. 30 of 2015

1. This Order may be cited as the Property Transfer Tax (Exemption) Order, 2015

2. The transfer of property by Millennium Challenge Account Zambia and any

person or individual eligible for property transfer tax exemption as provided in the
Millennium Challenge Compact Act, 2013 shall be exempt from property transfer
tax.