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Table 3.1: Resident individuals income tax schedule for the year 2023/2024
Monthly income in TZS Tax rate in TZS
Where the total income does not exceed NIL
270,000
Where the total income exceeds 270,000 8% of the amount in excess of 270,000
but does not exceed 520,000
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Where the total income exceeds 520,000 20,000 plus 20% of the amount in excess
but does not exceed 760,000 of 520,000
Where the total income exceeds 760,000 68,000.00 plus 25% of the amount in
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but does not exceed 1,000,000 excess of 760,000
Where the total income exceeds 128,000.00 plus 30% of the amount in
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1,000,000 excess of 1,000,000
Note: Threshold per annum: Annual
Income of 3,240,000 is not taxable
Source: TRA: Taxes and Duties at a Glance 2023/2024

Pension Fund Contributions: Employer and Employee Responsibilities
in Tanzania
Pension Fund Contributions represent statutory deductions, mandated by law, from an
employee’s salary towards a pension fund. These contributions are a shared responsibility
between the employer and the employee, with rates clearly stipulated. In Tanzania,
the pension fund system prior to 2018 comprised mandatory defined pension funds,
including the Parastatal Pension Fund (PPF), Public Service Pension Fund (PSPF), Local
Authority Pension Fund (LAPF), Government Employees Provident Fund (GEPF), and
the National Social Security Fund (NSSF).
However, significant changes occurred in 2018 when the parliament passed The Public
Service Social Security Fund Act No.2 of 2018. This act merged the four public funds
(PPF, PSPF, LAPF, and GEPF) into a single scheme named the Public Service Social
Security Fund (PSSSF). The PSSSF is responsible for collecting contributions and
making terminal benefit payments to public service employees. Meanwhile, the NSSF
continues to serve private sector employees. The contribution rates differ between these
two funds. For the NSSF, both the employee and employer contribute 10 per cent of the
basic salary. For the PSSSF, 5 per cent is deducted from the employee’s basic salary,
and the employer contributes 15 per cent. It is important to note that the employee’s
contribution is considered an expense to the employee, while the employer’s contribution
is an expense to the employer.
According to Tanzanian regulations, these contributions are considered allowable
deductions. This means they should be deducted from the gross salary before applying the
relevant tax rate to calculate the PAYE amount. Understanding of this issue is critically

Student’s Book Form Five
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