ZRA tightens tax clearance rules for businesses over tax registration gaps

Zambia’s tax authority has tightened controls on the issuance and renewal of Tax Clearance Certificates (TCCs), blocking businesses whose taxpayer identification numbers (TPINs) were not linked to the tax types applicable to their operations.

Zambia Revenue Authority (ZRA) Manager for Corporate Communications, Oliver Nzala, said the measures were aimed at curbing tax evasion, illicit financial flows and the misuse of companies to conduct undeclared commercial activities.

In a statement issued on Wednesday, Nzala said ZRA had observed that some businesses registered with the Patents and Companies Registration Agency (PACRA) obtained TPINs but failed to register for the taxes applicable to their operations.

While some of the businesses remained inactive, investigations had found that others continued conducting commercial activities without corresponding tax accounts with ZRA, he said.

“Of particular concern is that, in some cases, such entities may be used as shell companies or conduits for transactions intended to conceal taxable activity, facilitate tax evasion or enable illicit financial flows,” Nzala said.

He said the trend had also been identified through analysis of Suspicious Transaction Reports submitted by the Financial Intelligence Centre (FIC), which indicated that some businesses holding TPINs were involved in financial transactions without the appropriate tax registrations.

Under the new controls, businesses whose TPINs are not linked to the relevant tax types will not be issued or allowed to renew TCCs until they regularise their tax registration and meet their tax obligations.

Nzala said the measures were intended to protect the credibility of the TCC as evidence that a business was properly registered and compliant with its tax obligations.

The certificate is used in commercial, regulatory and public procurement transactions, making safeguards against its misuse important, he said.

The controls are also expected to help ZRA identify businesses operating without required tax registrations, detect potential shell-company arrangements and improve the integrity of the taxpayer register.

Nzala urged businesses registered through PACRA to review their tax status and ensure they were registered for all tax types applicable to their operations.

He said businesses holding TPINs but lacking the relevant tax registrations should regularise their status with ZRA.

Nzala clarified that the measures applied only to business-related TPINs obtained through PACRA registration and do not affect individuals holding TPINs in their personal capacity.

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