Invoicing and Tax regulation in Tanzania
Invoicing Regulation in Tanzania
In Tanzania, all businesses are required to adhere to invoicing regulations under the country's law. Businesses need to issue and maintain invoices for all transactions for at least five years. The Tanzania Revenue Authority (TRA) monitors these invoices to ensure compliance. Businesses not adhering to these regulations could face penalties.
Real-time Reporting / Fiscalization in Tanzania
Real-time reporting or fiscalization is mandatory in Tanzania. The Electronic Fiscal Device Management System (EFDMS) by TRA requires all businesses to report their transactions immediately via electronic fiscal devices. It helps the TRA in monitoring and collecting VAT effectively.
E-Invoicing in Tanzania
E-Invoicing is not yet mandatory in Tanzania. However, it is highly encouraged, as it simplifies the invoicing process and makes it more efficient. The transition to e-Invoicing is also seen as a way of reducing fraud and increasing transparency in transactions.
VAT/GST/Tax Compliance in Tanzania
In Tanzania, businesses are required by law to comply with tax obligations, including VAT and GST. The standard VAT rate stands at 18%. Certain goods and services may be exempted or attract zero-rated VAT. The TRA is the regulating authority for all tax-related concerns in the country, and businesses are required to register for VAT if their turnover exceeds TZS 100 million in a year.
B2B, B2C, and B2G Business in Tanzania
Invoicing requirements and tax obligations are generally the same for B2B, B2C, and B2G businesses in Tanzania. All are required to provide invoices for their transactions, adhere to the country’s tax laws, and report their transactions in real-time where possible. However, for B2B transactions, the recipient may claim the input VAT, following certain conditions set by the TRA.