Interest is the component of a tax debt that compensates the State for being kept out of its money. It is not a punishment — it is the time-value-of-money charge that runs, automatically and by operation of law, on tax that is paid late. It is distinct from the penalty/additional-tax component (which is punitive and discretionary) and from the principal (the tax itself). Understanding how interest is calculated — the rate, the base, the start date, the end date, and the rounding convention — is essential because interest is the one component that never stops accruing until the debt is paid in full, and because it compounds the cost of every day a debtor delays.

For income tax, the governing provision is Section 71(2) of the Income Tax Act [Chapter 23:06]: where tax is not paid by its due date, "interest, calculated at a rate to be fixed by the Minister, by statutory instrument, shall be payable on so much of the tax … as from time to time remains unpaid … beginning on the date specified by the Commissioner … and ending on the date the tax … is paid in full". The rate is set by statutory instrument — SI 212 of 2022 (the Income Tax (Rate of Interest) Notice, 2022; gazetted 19 December 2022, backdated to 1 December 2022) — and the percentage is not stated in the Act; it must be read from the instrument. The same Section 71(2) mechanism applies, mutatis mutandis, to unpaid provisional tax (via Section 72(9)) and a parallel provision governs late PAYE (Section 73(3)). The only way income-tax interest is switched off is the special-circumstances proviso to Section 71(2) (an interest-free extension), narrowly construed — MR Bank Ltd v ZIMRA 19-HH-779 holds that a deliberate misapplication of funds is not a special circumstance — and, for provisional tax, the Section 72(11) waiver (special circumstances, an under-estimate of not more than 10%, or other sufficient cause; SZ (Pvt) Ltd v ZIMRA 20-HH-142).

For VAT, interest is charged under Section 39 of the VAT Act [Chapter 23:12]. Section 39(3) provides that a person who fails to pay VAT within the allowed period shall pay, in addition to the tax, "(a) a penalty of a prescribed amount not exceeding an amount equal to the said amount of tax" (the 100% penalty) and "(b) … interest on the said amount of tax, calculated at the prescribed rate (but subject to section forty-six) for each month or part of a month in the period reckoned from the first day of the month following the month during which the period allowed for payment ended". Two computational features matter enormously here: VAT interest runs per month or part of a month (so a single day into a new month triggers a whole month's interest — the "part of a month" rounding trap), and it is reckoned from the first day of the following month, not from the original due date. The "prescribed rate" is fixed by regulation (the Fifth Schedule to the VAT (General) Regulations, SI 273/2003, with a separate foreign-currency rate introduced by SI 53/2021 and subsequently updated). VAT interest may be remitted under Section 39(5) only where the Commissioner is satisfied there was no financial loss to the State, no financial benefit to the operator, and no intent to avoid or postpone the tax (VSL (Pvt) Ltd & 3 Ors v ZIMRA 19-HH-023).

A critical cross-cutting rule is currency segregation. Tax collected in USD attracts the foreign-currency interest rate and is paid in USD; tax in ZiG/local currency attracts the local-currency rate. The two streams are never netted. Equally important is Section 46 of the VAT Act ("Calculation of interest payable under this Act"): where the prescribed rate is altered with effect from a date, the portion of the period (or the months/part-months) that commenced before that date is calculated as if the rate had not been altered — there is no retroactive re-rating. This lesson walks each interest provision clause by clause, sets out the rate framework (flagging every figure that must be verified against the current statutory instrument), shows line-by-line USD worked computations (including the part-month rounding trap and a mid-period rate change under Section 46), distinguishes interest from penalties and additional tax, integrates the case law, and closes with comparison tables and decision diagrams.

When tax is paid late, the State suffers a real economic loss: it could have used that money (to fund services, to avoid borrowing) during the period of delay. Interest is the charge that compensates for that loss. This is its defining characteristic and the key to understanding it: interest is compensatory, not punitive. It does not depend on fault, intention or culpability. It runs automatically, by operation of law, the moment tax is unpaid after its due date, and it keeps running — day after day, or month after month — until the tax is paid in full.

This distinguishes interest sharply from the other secondary components of a tax debt established in the Identification and Classification of Tax Debt and Interest and Penalties lessons:

• Principal — the tax itself (the primary liability).
• Interest — compensatory; automatic; time-based; calculated as a rate × base × time.
• Penalty / additional tax — punitive; discretionary; tied to culpability (e.g. the Section 46 additional tax of up to 100% in the Income Tax Act; the Section 39 / Section 66 penalties in the VAT Act).

Because interest is automatic and compounding-in-effect (it accrues on the unpaid balance continuously), it is the component a debtor can least afford to ignore. A penalty is a one-time loading; interest is a meter that keeps running. Every lesson on payment plans, write-offs and enforcement turns, at some point, on the simple arithmetic of this meter.

Why the topic is examinable and audited

Interest calculation is examinable precisely because it is mechanical but trap-laden: the rate is in a statutory instrument (not the Act), it differs by currency, VAT rounds by whole-or-part months, the start date differs between income tax (the due date) and VAT (the first of the following month), and a mid-period rate change must be handled under Section 46 without retroactive re-rating. A candidate who can compute interest correctly, in the right currency, with the right rounding, demonstrates command of the whole debt-arithmetic. ZIMRA audit interest is high because under-stated interest is a common reconciliation error on the taxpayer ledger.

Terminology

• Compensatory interest — interest that compensates the State for late payment; automatic.
• Prescribed rate — the interest rate fixed by statutory instrument/regulation (income tax: SI 212/2022; VAT: Fifth Schedule, SI 273/2003 as updated).
• Part of a month — the VAT convention by which any fraction of a month counts as a full month for interest.
• Currency segregation — USD-denominated tax bears the foreign-currency rate; local-currency tax bears the local rate; never netted.
• Remission — the discretionary reduction/cancellation of interest where the statutory conditions are met (Section 71(2) proviso; Section 72(11); VAT Section 39(5)).

B.1 Income tax — Section 71(2)

Section 71(2) of the Income Tax Act [Chapter 23:06] is the master interest provision for income tax:

"If tax is not paid on or before such days … as are fixed or prescribed … interest, calculated at a rate to be fixed by the Minister, by statutory instrument, shall be payable on so much of the tax or an instalment of the tax … as from time to time remains unpaid by the taxpayer during the period beginning on the date specified by the Commissioner … as the date on which the tax … shall be paid and ending on the date the tax … is paid in full: Provided that in special circumstances the Commissioner may extend the time for payment of the tax without charging interest."

The anatomy of income-tax interest:

1. Base — "so much of the tax … as from time to time remains unpaid". Interest is charged on the outstanding balance, so as the debtor pays down capital the interest base shrinks.
2. Rate — "fixed by the Minister, by statutory instrument" — SI 212 of 2022. The percentage is in the instrument, not the Act (VERIFY).
3. Start — "beginning on the date specified by the Commissioner" (in practice, the due date of the tax).
4. End — "ending on the date the tax … is paid in full". Interest runs to the day of full payment.
5. The only switch-off — the proviso: special-circumstances interest-free extension. MR Bank Ltd v ZIMRA 19-HH-779 — a deliberate misapplication of funds is not a special circumstance.

B.2 Income tax — provisional tax (Section 72(9)–(11)) and PAYE (Section 73(3))

• Section 72(9) applies Section 71(2) interest, mutatis mutandis, to any provisional tax (QPD) remaining unpaid after its quarterly payment date; and Section 72(10) deems a short-paid QPD (less than the prescribed percentage of the tax actually due) to be provisional tax remaining unpaid from that QPD — so interest runs from the early date on the deficit. Section 72(11) allows the Commissioner to waive interest where the taxpayer, through special circumstances, could not pay, under-estimated by not more than 10%, or had other sufficient cause (SZ (Pvt) Ltd v ZIMRA 20-HH-142).
• Section 73(3) charges interest on late employees' tax (PAYE) "at a rate to be fixed by the Minister, by statutory instrument … on so much of such amount as from time to time remains unpaid … beginning on the day next following the last day of the period prescribed … and ending on the day such amount is paid in full" — unless the Commissioner, having regard to the circumstances, otherwise directs.

B.3 VAT — Section 39

Section 39 of the VAT Act [Chapter 23:12] ("Penalty and interest for failure to pay tax when due") charges both the penalty and the interest. Section 39(3) is the core late-payment provision:

"If any person … fails to pay any amount of such tax within the period allowed … he shall, in addition to such amount of tax, pay— (a) a penalty of a prescribed amount not exceeding an amount equal to the said amount of tax [the 100% penalty]; and (b) where payment … is made on or after the first day of the month following the month during which the period allowed for payment … ended, interest on the said amount of tax, calculated at the prescribed rate (but subject to section forty-six) for each month or part of a month in the period reckoned from the said first day."

The anatomy of VAT interest:

1. Base — the amount of tax unpaid.
2. Rate — the "prescribed rate" (fixed by regulation under Section 78 — the Fifth Schedule to the VAT (General) Regulations, SI 273/2003; foreign-currency rate via SI 53/2021; understood updated by SI 25/2025 — VERIFY), "subject to Section 46".
3. Convention — "for each month or part of a month": any fraction of a month counts as a full month.
4. Start — "reckoned from the first day of the month following the month during which the period allowed for payment ended" — not the original due date.
5. Additional tax interest — Section 39(4) charges interest on unpaid Section 66 additional tax, "for each month or part of a month during which the said tax is not paid".
6. Remission — Section 39(5): the Commissioner may remit penalty or interest only where the failure (a) caused no financial loss to the State, (b) yielded the operator no financial benefit, and (c) was not due to an intent to avoid or postpone the tax (VSL (Pvt) Ltd & 3 Ors v ZIMRA 19-HH-023).

B.4 VAT — Section 46 (no retroactive re-rating)

Section 46 ("Calculation of interest payable under this Act") governs what happens when the rate changes mid-period. Where interest is payable under Sections 36, 39 or 45, and the rate "has with effect from any date been altered", and the interest relates to a period (or months/part-months) that commenced before that date, then the interest for the pre-change portion "shall be calculated as if the said rate had not been so altered". In plain terms: a rate change is not retroactive — each segment of the period is charged at the rate in force during that segment.

B.5 The "prescribed rate" and currency

The VAT Act defines "prescribed rate" as "the prescribed rate of interest fixed in terms of section seventy-eight or, where such rate has not been so prescribed, at the rate fixed in terms of the Prescribed Rate of Interest Act [Chapter 8:10]". The Fifth Schedule to SI 273/2003 sets the rate; SI 53/2021 introduced a distinct foreign-currency rate. The practical position carried through the Payment of Tax Liabilities and Write-Offs and Remission lessons is that the local-currency rate is the policy rate + 5% and the foreign-currency rate is 10% per annum (per SI 25/2025) — both to be verified. Tax collected in USD bears the forex rate and is settled in USD; local-currency tax bears the local rate; the two are never netted (the currency-of-payment rule, Delta Beverages (Pvt) Ltd v ZIMRA 23-HH-577).

C.1 The universal formula and its variables

At its simplest, compensatory interest is:

Interest = Outstanding tax × Rate × Time

Every dispute about an interest figure is a dispute about one of those three variables — the base (how much tax was unpaid), the rate (which statutory instrument, and which currency), or the time (start date, end date, and how fractions are counted). Master the three variables and you master the calculation.

C.2 Income tax — simple interest on the running balance

Income-tax interest under Section 71(2) accrues on the balance "from time to time remaining unpaid", from the due date to the date of full payment. Conceptually it is simple interest computed on the outstanding capital for the period it is outstanding. If a debtor pays in instalments, the base steps down with each capital repayment, so the interest for each sub-period is computed on the then-current balance. There is no statutory "part of a month" rounding for income tax — interest runs on a time-proportionate basis over the actual period unpaid (subject to the precise terms of the rate instrument).

C.3 VAT — the per-month-or-part-of-a-month convention

VAT interest under Section 39(3)(b) is fundamentally different in its time variable. It is charged "for each month or part of a month", reckoned from the first day of the month following the payment period. Two consequences:

1. Rounding up to whole months. A payment that is one day into a new month incurs a full month's interest for that month. There is no pro-rating within a month. A debtor who can pay even a day before month-end saves a whole month's interest.
2. The start is the 1st of the following month, not the due date. If the VAT period's payment was due on (say) the 25th and the operator pays on the 30th of the same month, no Section 39(3)(b) interest arises (payment was before the first day of the following month) — though the 100% penalty under Section 39(3)(a) and any other consequences still apply. Interest begins to bite only once payment slips into the next month.

C.4 Currency: two meters, never merged

A taxpayer with both USD and local-currency liabilities runs two interest meters at two different rates. The USD debt accrues at the forex rate (illustratively 10% p.a.); the local-currency debt accrues at the local rate (illustratively policy + 5%). They are computed and paid separately. Netting a USD credit against a ZiG debt (or vice versa) is impermissible — a frequent reconciliation error.

C.5 Rate changes: Section 46 segmentation

Because the prescribed rate is periodically altered by new statutory instruments, a long-running debt may straddle a rate change. Section 46 requires segmentation: the months/part-months before the change are charged at the old rate; those after at the new rate. The change is never applied backwards. The practitioner computing interest on an old debt must therefore (a) identify every rate in force across the period, (b) split the period at each change date, and (c) sum the segments.

C.6 Interest never stops — and the only ways it ends

Interest ends only when one of these occurs:

• the tax is paid in full (the natural terminus — Section 71(2) "ending on the date the tax … is paid in full");
• the Commissioner grants a special-circumstances interest-free extension (proviso to Section 71(2)) or a provisional-tax waiver (Section 72(11)) or a VAT remission under Section 39(5) — each on narrow, evidence-based conditions; or
• the principal is extinguished by prescription or statute (covered in Write-Offs and Remission and Civil Recovery Through Courts).

Crucially, a payment plan does not stop interest (see the Payment Plans and Instalments lesson) — it only schedules the capital, while interest continues on the declining balance. This is why the arithmetic of interest is the silent driver of debt strategy: delay is never free.

All rates below are illustrative and clearly flagged; the actual rates must be taken from the governing statutory instruments (see VERIFY flag). The methods, however, are exact.

D.1 Income tax — simple interest to date of payment

Facts. A sole trader owes USD 10,000 income tax due 30 April 2025, paid in full on 31 October 2025 — i.e. 6 months late. Assume an illustrative income-tax interest rate of 15% per annum (USD/forex rate — illustrative).

Computation (line by line):

(If a Section 46 additional-tax penalty had been imposed, it would be added separately; here we isolate interest.)

D.2 Income tax — instalments: interest on the declining balance

Facts. The same USD 10,000 debt is paid in two instalments: USD 5,000 on 31 July 2025 (3 months late) and USD 5,000 on 31 October 2025 (6 months late). Illustrative rate 15% p.a.

Paying half the capital early reduces the interest base for the second sub-period (USD 562.50 vs USD 750 if nothing were paid until October) — the arithmetic that rewards early part-payment.

D.3 VAT — the part-of-a-month rounding trap

Facts. An operator owes USD 8,000 VAT for a period whose payment was due 15 January 2026 (the current statutory VAT deadline; see the Payment of Tax Liabilities lesson). It pays on 2 March 2026. Illustrative forex interest rate 10% p.a. (i.e. ~0.8333% per month).

Interest reckoning (Section 39(3)(b)): interest runs "for each month or part of a month … reckoned from the first day of the month following the month during which the period allowed for payment ended". The payment period ended in January, so interest is reckoned from 1 February 2026. Payment is on 2 March 2026:

Because 2 March is a part of March, it counts as a whole month — so two days into March costs a full month's interest. Had the operator paid on 28 February instead, only one month (February) would be charged: USD 66.67. Separately, the Section 39(3)(a) 100% penalty of USD 8,000 applies (subject to possible Section 39(5) remission). Total exposure: USD 8,000 principal + USD 8,000 penalty + USD 133.34 interest = USD 16,133.34.

D.4 VAT — a mid-period rate change under Section 46

Facts. A USD 12,000 VAT debt runs unpaid for 4 months — say the interest period is 1 March 2026 to 30 June 2026. Suppose the forex prescribed rate is 10% p.a. (~0.8333%/month) for March–April, then altered to 12% p.a. (~1%/month) from 1 May 2026. Section 46 requires no retroactive re-rating:

The March–April months are charged at the old 10% rate even though the rate later rose, exactly as Section 46 directs. Mis-applying the new rate to the whole period (12,000 × 1% × 4 = USD 480) would over-state interest by USD 40 — a common error.

D.5 SME — provisional tax short-payment interest (Section 72(9)–(11))

Facts. A company'Section 1st QPD (due 25 March 2025) should have been USD 4,000 (10% of USD 40,000 estimated provisional tax) but it paid only USD 2,000. The USD 2,000 deficit is deemed provisional tax remaining unpaid from 25 March (Section 72(10)); it is cleared at year-end settlement on 31 December 2025 — about 9 months later. Illustrative rate 15% p.a.

If the company under-estimated by no more than 10%, it may seek a Section 72(11) waiver of this interest (SZ 20-HH-142); otherwise the USD 225 stands.

D.6 Large corporate — currency segregation (two meters)

Facts. A corporate has a USD 100,000 income-tax debt and a ZiG 2,000,000 VAT debt, both 4 months late. The USD debt accrues at the forex rate (illustratively 10% p.a.); the ZiG debt at the local rate (illustratively policy + 5%). The two are computed separately:

• USD interest = 100,000 × 10% × 4/12 = USD 3,333.33 (paid in USD).
• ZiG interest = 2,000,000 × (local rate) × 4/12 (per month/part-month for VAT) = computed at the local rate (illustrative), paid in ZiG.

The corporate cannot offset a USD overpayment against the ZiG interest, nor vice versa — the meters run and settle in their own currencies.

• MR Bank Ltd v ZIMRA 19-HH-779 — On the proviso to Section 71(2): the Commissioner may extend time for payment without charging interest only in special circumstances, and a deliberate misapplication of funds is not such a circumstance. Defines the narrow gateway to income-tax interest relief — the difference between an interest meter that stops and one that keeps running.
• SZ (Pvt) Ltd v ZIMRA 20-HH-142 — On the Section 72(11) provisional-tax interest waiver: confirms the Commissioner's discretion to waive interest where the taxpayer was, through special circumstances, unable to pay, under-estimated by not more than 10%, or had other sufficient cause. The provisional-tax analogue of the Section 71(2) proviso.
• VSL (Pvt) Ltd & 3 Ors v ZIMRA 19-HH-023 — On Section 39(5) VAT remission: interest (and penalty) may be remitted only where there was no financial loss to the State, no financial benefit to the operator, and no intent to avoid or postpone the tax. Establishes the cumulative three-part test that controls when VAT interest can be forgiven.
• Delta Beverages (Pvt) Ltd v ZIMRA 23-HH-577 — On currency of payment: tax referable to USD-denominated transactions is paid in USD. Underpins the currency-segregation rule for interest — the forex interest meter on USD debt is distinct from the local-currency meter.
• Mayor Logistics (Pvt) Ltd v ZIMRA 14-CC-007 (Constitutional Court) — Pay-now-argue-later: because an objection does not suspend the obligation to pay, interest continues to accrue while a dispute runs (subject to a due adjustment if the assessment is later altered — Section 69(2)/VAT Section 36). A disputing debtor who loses pays interest for the whole dispute period.

(Zimbabwean interest-calculation rules are predominantly statutory and rate-instrument-driven; where no case is on point the position rests on Sections 71–73, VAT Sections 39 and 46, and the governing statutory instruments rather than on invented authority.)

1. Treating interest as a penalty (or vice versa). Interest is compensatory and automatic; the Section 46 additional tax (income tax) and the Section 39(3)(a)/Section 66 penalties (VAT) are punitive and discretionary. They are computed differently, remitted under different tests, and must be shown as separate components on the ledger.
2. Using a rate from memory. The rate is in a statutory instrument, not the Act, and it changes. Always read the current SI (income tax: SI 212/2022; VAT: Fifth Schedule, SI 273/2003 as updated) and use the right currency rate.
3. Ignoring the VAT "part of a month" rounding. Any fraction of a month is a whole month for VAT interest (Section 39(3)(b)). Paying one day into a new month costs a full month — so pay before month-end where possible.
4. Mis-dating the VAT interest start. VAT interest is reckoned from the first day of the month following the payment period — not the original due date. Payment within the same month as the deadline attracts no Section 39(3)(b) interest (though the penalty still applies).
5. Applying a new rate retroactively. Section 46 forbids this: each segment of the period is charged at the rate then in force. Split the period at every rate-change date.
6. Netting currencies. USD and local-currency interest run on separate meters at separate rates and settle in their own currencies. Never offset one against the other.
7. Assuming a payment plan stops interest. It does not — interest runs on the declining balance throughout (see Payment Plans and Instalments). Only the Section 71(2) proviso / Section 72(11) waiver / VAT Section 39(5) remission stops it.
8. Forgetting interest keeps running during a dispute. Pay-now-argue-later (Mayor Logistics 14-CC-007) means a disputed-but-unpaid tax keeps accruing interest; a debtor who loses the objection faces interest for the entire dispute period.

Work through the questions one at a time. Choose an answer and it is graded immediately, with an explanation and the provision it comes from. Your progress is saved, so you can stop and resume.

• Interest is compensatory, not punitive, and runs automatically on unpaid tax until it is paid in full. It is a distinct component from principal and from penalty/additional tax, and must be shown separately on the ledger.
• Income tax: Section 71(2) — interest at a Minister-fixed rate (SI 212 of 2022) on the balance "from time to time remaining unpaid", from due date to full payment. Provisional tax follows via Section 72(9)–(10) (short-paid QPDs deemed unpaid from their date); PAYE via Section 73(3).
• VAT: Section 39(3)(b) — interest at the prescribed rate, for each month or part of a month, reckoned from the first day of the month following the payment period (not the due date). The 100% penalty under Section 39(3)(a) is separate.
• The "part of a month" rule rounds up: one day into a new month costs a whole month of VAT interest — pay before month-end where possible.
• Currency segregation: USD tax bears the forex rate (illustratively 10% p.a.); local-currency tax bears the local rate (illustratively policy + 5%); the meters are never netted (Delta 23-HH-577).
• Section 46: a rate change is never retroactive — segment the period and charge each part at the rate then in force.
• Interest is reduced/cancelled only by the Section 71(2) proviso, the Section 72(11) waiver, or VAT Section 39(5) remission — each on narrow, evidence-based conditions (MR Bank 19-HH-779; SZ 20-HH-142; VSL 19-HH-023). A payment plan does not stop interest, and interest keeps running through a dispute (Mayor Logistics 14-CC-007) — so delay always has a price. All rate percentages must be verified against the current statutory instruments.

Table 1 — Interest vs penalty vs additional tax

Table 2 — Income-tax vs VAT interest mechanics

Table 3 — Currency and rate (illustrative; verify against current SI)

Diagram 1 — Computing interest on a tax debt

flowchart TD
 A[Tax unpaid after due date] --> B{Which head?}
 B -->|Income tax| C[s71 2: rate from SI 212/2022 on balance unpaid]
 B -->|Provisional tax| D[s72 9-10: short QPD deemed unpaid from its date]
 B -->|VAT| E[s39 3 b: prescribed rate per month or part-month]
 C --> F[Interest = balance x rate x time to full payment]
 D --> F
 E --> G[Start = 1st of following month; round part-months up]
 G --> H{Rate changed mid-period?}
 H -->|Yes| I[Segment per s46 - no retroactive re-rating]
 H -->|No| J[Single rate across period]
 F --> K{Currency?}
 J --> K
 I --> K
 K -->|USD| L[Forex rate - settle in USD]
 K -->|ZiG| M[Local rate - settle in ZiG - never netted]

Diagram 2 — When does the interest meter stop?

flowchart TD
 A[Interest accruing] --> B{Tax paid in full?}
 B -->|Yes| C[Meter stops - s71 2 ending date]
 B -->|No| D{Special circumstances / no loss-benefit-intent?}
 D -->|Income tax| E[s71 2 proviso - interest-free extension MR Bank]
 D -->|Provisional| F[s72 11 waiver - 10% under-estimate SZ]
 D -->|VAT| G[s39 5 remission - VSL]
 D -->|No| H[Meter keeps running - even on a plan, even during a dispute Mayor Logistics]

Statutes & sections

• Income Tax Act [Chapter 23:06]
• Section 71(2) — Interest on unpaid tax at a Minister-fixed rate, on the balance from time to time unpaid, to date of full payment; special-circumstances interest-free extension proviso.
• Section 72(9)–(11) — Provisional-tax interest (Section 71(2) applied to unpaid QPDs); short-paid QPD deemed unpaid from its date (Section 72(10)); interest waiver (Section 72(11)).
• Section 73(3) — Interest on late employees' tax (PAYE), Minister-fixed rate, unless the Commissioner otherwise directs.
• Section 69 — Pay-now-argue-later; interest continues during a dispute, subject to Section 69(2) adjustment.
• Value Added Tax Act [Chapter 23:12]
• Section 39 — Penalty (Section 39(3)(a) 100%) and interest (Section 39(3)(b) prescribed rate, per month or part of a month, from the first day of the following month); Section 39(4) interest on unpaid Section 66 additional tax; Section 39(5) remission (no loss / no benefit / no intent).
• Section 46 — Calculation of interest where the rate is altered: no retroactive re-rating.
• Section 36 — Pay-now-argue-later (VAT); due adjustment with interest if assessment altered.
• Definition of "prescribed rate" (fixed under Section 78 / regulations, failing which the Prescribed Rate of Interest Act [Chapter 8:10]).
• Finance Act [Chapter 23:04] and statutory instruments — income-tax rate: SI 212 of 2022; VAT rate: Fifth Schedule to the VAT (General) Regulations SI 273/2003, foreign-currency rate SI 53/2021, understood updated by SI 25/2025 (local = policy + 5%; forex = 10%). (All percentages to be verified — see VERIFY flag.)

Case law

• MR Bank Ltd v ZIMRA 19-HH-779 — proviso to Section 71(2): deliberate misapplication is not "special circumstances" for an interest-free extension.
• SZ (Pvt) Ltd v ZIMRA 20-HH-142 — Section 72(11) interest waiver for provisional tax (≤10% under-estimate / special circumstances / sufficient cause).
• VSL (Pvt) Ltd & 3 Ors v ZIMRA 19-HH-023 — Section 39(5) VAT remission: cumulative no-loss / no-benefit / no-intent test.
• Delta Beverages (Pvt) Ltd v ZIMRA 23-HH-577 — currency of payment; underpins currency segregation of interest.
• Mayor Logistics (Pvt) Ltd v ZIMRA 14-CC-007 (Constitutional Court) — pay-now-argue-later; interest runs during a dispute.

ZIMRA guidance

• Comprehensive Guide to the ZIMRA Self-Service Portal (TaRMS) — the taxpayer ledger on which principal, interest and penalty accrue and are reconciled.
• Zimbabwe Tax Compliance Calendar — due dates that fix when interest begins to run.