Rates, exemptions, property CGT, and how to calculate your liability
Capital Gains Tax (CGT) is a tax charged on the profit (capital gain) realised when you sell or dispose of certain assets in Zimbabwe. The tax is administered by the Zimbabwe Revenue Authority (ZIMRA) under the Capital Gains Tax Act [Chapter 23:01].
CGT applies to the gain — the difference between what you paid for an asset (the cost base) and what you sold it for (the sale proceeds). If there is no gain, or if you sell at a loss, no CGT is payable.
The most common scenarios where CGT arises in Zimbabwe are the sale of immovable property (houses, land, commercial buildings), the sale of shares, and the disposal of other capital assets. Understanding CGT is essential for anyone involved in property transactions or investment in Zimbabwe.
The Capital Gains Tax rates for the 2026 tax year are as follows:
| Asset Type | CGT Rate | Withholding Tax | Notes |
|---|---|---|---|
| Immovable property (land, buildings) | 20% of capital gain | 15% of sale price | WHT is advance payment of CGT |
| Specified assets (listed shares held 5+ years) | 5% of capital gain | 1% of sale price | Via stockbroker |
| Listed shares (held less than 5 years) | 20% of capital gain | 1% of sale price | Via stockbroker |
| Unlisted shares | 20% of capital gain | N/A | Self-assessment required |
| Other capital assets | 20% of capital gain | Varies | Includes marketable securities |
| Mining rights / claims | 20% of capital gain | N/A | Special rules apply |
One of the most important CGT rules in Zimbabwe is the 15% withholding tax on the sale of immovable property. This works as follows:
The basic CGT calculation follows this formula:
Capital Gain = Sale Price - Cost Base
CGT Payable = Capital Gain x CGT Rate (20% or 5%)
The cost base (also called the acquisition cost) includes:
Note: Routine maintenance and repairs are NOT included in the cost base. Only capital improvements that increase the value or extend the life of the asset qualify.
| Sale price of house | US$120,000 |
| Less: Purchase price (2019) | (US$60,000) |
| Less: Improvements (new roof, extension) | (US$15,000) |
| Less: Selling costs (agent commission 5%) | (US$6,000) |
| Less: Legal fees on acquisition | (US$2,000) |
| Capital Gain | US$37,000 |
| CGT at 20% | US$7,400 |
| WHT already paid (15% x US$120,000) | (US$18,000) |
| Refund due from ZIMRA | US$10,600 |
In this example, the 15% withholding tax (US$18,000) exceeded the actual CGT (US$7,400), so the seller is entitled to a refund of US$10,600 from ZIMRA.
| Sale proceeds (10,000 shares x US$3.50) | US$35,000 |
| Less: Purchase cost (10,000 shares x US$1.20) | (US$12,000) |
| Less: Brokerage fees on purchase and sale | (US$500) |
| Capital Gain | US$22,500 |
| CGT at 5% (specified asset, held 5+ years) | US$1,125 |
Our tax advisors can calculate your exact CGT liability and help you claim refunds on overpaid withholding tax.
Get Tax Help at RegisterCompany.co.zw Call 0861 200 6281Zimbabwe's tax law provides several exemptions and reliefs from Capital Gains Tax:
The first US$1,800 of capital gain on the sale of your principal private residence (the home you live in) is exempt from CGT. To qualify:
If you sell your principal private residence and purchase a replacement residence, you may defer the capital gain. The conditions are:
If your property is compulsorily acquired (e.g., by government for public purposes) and you receive compensation, rollover relief may apply if you reinvest the compensation in a similar asset.
Assets transferred on death to a surviving spouse or heir may qualify for CGT rollover. The inheritor takes over the deceased's cost base and CGT only becomes payable when the inheritor subsequently disposes of the asset.
Transfers of assets between spouses (during marriage, not on divorce) are generally exempt from CGT. The receiving spouse inherits the original cost base.
While not an exemption, the reduced rate of 5% (instead of 20%) on listed shares held for more than 5 years provides significant relief for long-term investors. This encourages investment in the Zimbabwe Stock Exchange.
Here is the process for filing Capital Gains Tax returns:
When you inherit property and later sell it, CGT is calculated based on the deceased's original cost base (what they paid for it), not the market value at the date of inheritance. This can result in a larger capital gain and higher CGT liability. However, if the property was the deceased's principal residence, the exemption may still apply.
When jointly owned property is sold, each owner's share of the capital gain is calculated separately. Each owner is responsible for their own CGT on their share. The 15% withholding tax is calculated on the total sale price and apportioned between owners.
Commercial property sales (offices, shops, warehouses, industrial property) are subject to CGT at 20% of the capital gain. There is no principal residence exemption for commercial property. The 15% withholding tax still applies.
The sale of agricultural land is subject to CGT. However, land acquired under government resettlement programmes may have special valuation rules. Consult a tax advisor for land that was acquired without a clear market-value purchase price.
Zimbabwe's history of hyperinflation creates challenges in calculating cost bases for assets acquired during the hyperinflationary period (2007-2009). ZIMRA has issued guidance on deemed cost bases for assets acquired during this period. If your asset was purchased during hyperinflation, you may need professional assistance to determine the correct cost base.
Failure to comply with CGT obligations can result in significant penalties:
For more information on ZIMRA penalties, see our ZIMRA Penalties Guide.
Explore these related guides for a comprehensive understanding of Zimbabwe's tax system:
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