- Updated
- October 2025
- Sections
- 15
- Questions
- 47
Key Facts
Core Framework
Section 97A of Income Tax Act Chapter 323 of the Laws of Zambia
Regulation 20 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
The domestic transfer pricing legislation is construed in a manner consistent with the OECD guidelines. However, where inconsistencies between the guidelines and domestic legislation exist, domestic legislation shall prevail.
Regulation 11 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
Regulation 11 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
Regulation 20 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
The choice of the comparables should be consistent with the OECD Guidelines.
Regulation 16 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Documentation
Regulations 21, 22 and 22A of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
A section of the income tax return provides for inclusion of details of related party transactions.
Regulations 21, 22 and 22A of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
A section of the income tax return provides for inclusion of details of related party transactions.
Regulations 21, 22 and 22A of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
A section of the income tax return provides for inclusion of details of related party transactions.
Section 97C of the Income Tax Act Chapter 323 of the Laws of Zambia
The Income Tax Act prescribes penalties for non-compliance to the preparation and maintenance of transfer pricing documentation but does not provide for incentives for compliance. Section 97C(7) of the Income Tax Act prescribes a penalty of eighty million penalty units for failure to comply with the requirements for preparing and maintaining transfer pricing documentation. Currently, a penalty unit is equal to ZMW 0.40 (40 ngwee).
TP Methods
- CUP
- Resale Price
- Cost Plus
- TNMM
- Profit Split
- Other
Selection: Most appropriate method
Dispute Resolution
Section 74(1)(b) of the Income Tax Act Chapter 323 of the Laws of Zambia; Zambia's MAP Profile
Please see information available on Zambia’s OECD MAP Profile.
Section 74(1)(b) of the Income Tax Act Chapter 323 of the Laws of Zambia; Zambia's MAP Profile
Please see information available on Zambia’s OECD MAP Profile.
Simplifications
Regulation 17 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Zambia follows the guidance on low value-adding intra-group services (see answer to question 24).
Zambia is yet to review the domestic transfer pricing framework to take into account the simplified and streamlined approach.
Special Topics
Regulation 18 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Yes. If so, does your domestic transfer pricing framework follow (or largely follow) the guidance in Chapter VI of the TPG? Yes
Regulation 17 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Yes. If so, does your domestic transfer pricing framework follow (or largely follow) the guidance in Chapter VII of the TPG? Yes
Zambia follows the OECD Guidelines on financial transactions.
Full OECD Questionnaire
Legal ReferenceSection 97A of Income Tax Act Chapter 323 of the Laws of Zambia
Legal ReferenceRegulation 20 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
The domestic transfer pricing legislation is construed in a manner consistent with the OECD guidelines. However, where inconsistencies between the guidelines and domestic legislation exist, domestic legislation shall prevail.
Legal ReferenceSection 97A of Income Tax Act Chapter 323 of the Laws of Zambia
“Related or associated persons” include: a) parties connected directly or indirectly through shareholding, equity or partnerships; b) any joint venture owned or operated jointly with an unrelated party; c) connected persons; d) parties connected through management control and capital; or e) Any existing arrangements, whether in writing or not, that benefit two or more entities whose conditions are deemed not to be at arm’s length;
Legal ReferenceRegulation 13 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Application of a method other than the five prescribed method requires approval from the Commissioner General pursuant to provisions of Regulation 13 sub-regulation 3 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
- CUP (provided)
- Resale Price (provided)
- Cost Plus (provided)
- TNMM (provided)
- Profit Split (provided)
- Other (provided)
Legal ReferenceRegulation 12 sub-regulation 2 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
Most appropriate method
- Hierarchy of methods (not selected)
- Most appropriate method (selected)
- Other (if so, please explain) (not selected)
Legal ReferenceSection 97A of Income Tax Act Chapter 323 of the Laws of Zambia
Domestic transfer pricing framework provides for the use of a specific method for controlled transactions involving commodities (if so, please explain): For the sale of precious and base metals between related parties, the price to use is the reference price. The reference price in this case means; a) the monthly average London Metal Exchange cash price; b) the monthly average Fast markets MB cash price to the extent that the base metal or precious metal prices are not quoted on the London Metal Exchange; c) the monthly average cash price of any other metal exchange market as approved by the Commissioner-General to the extent that the base metal price or precious metal price is not quoted on the London Metal Exchange or Fast markets MB.
Legal ReferenceRegulation 11 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
Legal ReferenceRegulation 11 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
Legal ReferenceRegulation 20 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
The choice of the comparables should be consistent with the OECD Guidelines.
Legal ReferenceRegulation 16 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Legal ReferenceSub-regulation 1b of Regulation 11 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Legal ReferenceRegulation 18 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Yes. If so, does your domestic transfer pricing framework follow (or largely follow) the guidance in Chapter VI of the TPG? Yes
The transfer pricing analysis will be the same whether or not the intangible is hard-to-value.
Legal ReferenceSub-section 3(b)(i) of Section 65 of Income Tax Act Chapter 323 of the Laws of Zambia
10 years. It does not differ from the statute of limitations on other applicable transactions.
Training of tax administrators.
Zambia does not make a distinction between HTVI and “ordinary” intangibles.
Legal ReferenceRegulation 17 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Yes. If so, does your domestic transfer pricing framework follow (or largely follow) the guidance in Chapter VII of the TPG? Yes
Legal ReferenceRegulation 17 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Yes. If so, does it follow (largely follow) the low value-adding services approach in Chapter VII? Yes
Zambia follows the OECD Guidelines on financial transactions.
Legal ReferenceSection 29 (1B) of the Income Tax Act Chapter 323 of the Laws of Zambia
Domestic legislation has in place an interest limitation rule which provides that the interest expense shall not exceed 30% of tax EBITDA.
Legal ReferenceRegulations 21, 22 and 22A of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018.
A section of the income tax return provides for inclusion of details of related party transactions.
- Master file consistent with Annex I to Chapter V of the TPG (selected)
- Local file consistent with Annex II to Chapter V of the TPG (selected)
- Country-by-country report consistent with Annex III to Chapter V of the TPG (selected)
- Specific transfer pricing returns (separate or annexed to the tax return) (not selected)
- Other (specify) (selected)
Legal ReferenceTiming of Preparation: Sub-regulation 3 of Regulation 22 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018; Submission: Sub-regulation 2 of Regulation 23 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018; Language (English): Sub-regulation 3 of Regulation 23 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018; CbCR: Sub-regulations 8, 9 and 10 of Regulation 22A of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2020
Local file & Master file: The local file and master file should be prepared by the due date of the taxpayer filing their income tax return but should not accompany the return. However, submission shall be made within thirty days of issuance of a written request by the Commissioner General. The transfer pricing documentation should be submitted in the English language. CbCR: A constituent entity of a multinational enterprise group that is resident for tax purposes in the Republic shall notify the Commissioner-General whether it is the ultimate parent entity or the surrogate parent entity, no later than the last day of the reporting accounting year of the multinational enterprise group. The constituent entity that is resident for tax purposes in Zambia shall notify the Commissioner-General about the identity of the ultimate parent entity or surrogate parent entity no later than the last day of the reporting accounting year of the multinational enterprise group. A country-by-country report shall be filed no later than twelve months after the last day of the reporting accounting year of the multinational enterprise group.
Legal ReferenceSection 97C of the Income Tax Act Chapter 323 of the Laws of Zambia
The Income Tax Act prescribes penalties for non-compliance to the preparation and maintenance of transfer pricing documentation but does not provide for incentives for compliance. Section 97C(7) of the Income Tax Act prescribes a penalty of eighty million penalty units for failure to comply with the requirements for preparing and maintaining transfer pricing documentation. Currently, a penalty unit is equal to ZMW 0.40 (40 ngwee).
Legal ReferenceSub-regulation 2 of Regulation 21 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2020
The threshold for transfer pricing documentation preparation and maintenance is an annual turnover of 50 million Zambian Kwacha. This threshold only applies to local groups whereas multinational companies need to prepare TP documentation regardless of their turnover.
Legal ReferenceSection 74(1)(b) of the Income Tax Act Chapter 323 of the Laws of Zambia; Zambia's MAP Profile
Please see information available on Zambia’s OECD MAP Profile.
- Rulings (not selected)
- Enhanced engagement or cooperative compliance programmes (not selected)
- Advance Pricing Agreements (APA) (not selected)
- International Compliance Assurance Programme (ICAP) (not selected)
- Mutual Agreement Procedures (selected)
- Other (please specify) (not selected)
Zambia is yet to review the domestic transfer pricing framework to take into account the simplified and streamlined approach.
- In-scope tested parties resident within the jurisdiction can elect to apply the simplified and streamlined approach (i.e. safe harbour) (not selected)
- In-scope tested parties resident within the jurisdiction are required to follow the simplified and streamlined approach for in-scope qualified transactions and tax administrations are allowed to impose the application of the simplified and streamlined approach to in-scope qualified transactions of tested parties resident within their jurisdiction (i.e. rule) (not selected)
- N/A (selected)
Awaiting assessment results.
- 20% (not selected)
- 30% (not selected)
- Other (please specify) (selected)
- N/A (not selected)
Legal ReferenceRegulation 17 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Zambia follows the guidance on low value-adding intra-group services (see answer to question 24).
Legal ReferenceSection 97A of the Zambian Income Tax Act
A claim for an adjustment can be made under Section 97A of the Zambian Income Tax Act.
Taxpayers are allowed to amend returns after filing original returns which may have had errors.
Legal ReferenceRegulation 20 of the Income Tax (Transfer Pricing) (Amendment) Regulations, 2018
Zambia has 23 tax treaties in force. Out of the 23 tax treaties, 5 treaties have adopted the old version the OECD Model (pre-2010) as described above, and the remaining 18 treaties provide a balance between the OECD and the UN Models, adopting different paragraphs of both models.
- Article 7 as it read before 2010. (selected)
- Article 7 as it reads after 2010. (not selected)
- Other (please provide additional details) (selected)
There is no specific guidance for the attribution of profits to PEs, Zambia follows the same treatment of resident entities.
Need Help with Zambia Transfer Pricing?
ArmsLength AI provides automated benchmarking studies that meet local documentation requirements.