TRA Tax Debt Recovery Tanzania: Agency Notices, Seizure and Relief 2026

TRA tax debt recovery follows a fixed legal path on the Mainland. Once tax is due and unpaid, the Commissioner General can sue for it, register a charge over land, seize and sell goods, order your bank to pay over your balance, and in limited cases stop a person leaving the country. This guide sets out each tool, the time limits that protect you, and the relief you can request.

It is written for owners, finance managers and directors who have received a demand, an agency notice or a notice of intention to sell. Penalties and interest are covered in detail in our separate guide to TRA penalties and interest. Objection and appeal procedure is covered in appealing a TRA assessment to TRAB and TRAT. This article focuses on collection.

What the law says

The machinery sits in the Tax Administration Act, Cap. 438 R.E. 2023, as published by TRA. Part IX deals with payment and recovery. It splits into regular payment (sections 65 to 69), recovery from the taxpayer (sections 70 to 75) and recovery from third parties (sections 76 to 80). Part X then allows remission of interest and penalty under section 81.

We read the revised edition in two official copies: TRA's own file and the copy published by the Tax Revenue Appeals Board. Older commentary often cites the R.E. 2019 text on TanzLII, where the same provisions carry lower numbers. For example, the objection section is 51 in R.E. 2019 and 62 in R.E. 2023. Always check which edition a letter or opinion is citing.

The Act defines interest at the "statutory rate", meaning the prevailing discount rate determined by the Bank of Tanzania (section 3). Interest for failing to pay tax is section 87 in R.E. 2023. The operative wording we read in the R.E. 2019 equivalent (section 76) compounds that interest monthly from the due date.

When does unpaid tax become a tax debt?

Tax is payable at the time the relevant tax law fixes, under section 65. VAT, PAYE and withholding tax each have their own monthly dates. Tax under an adjusted assessment is payable within thirty days of service of the assessment notice (section 65(b)).

From the day after the due date, three things happen together. Interest starts to run at the statutory rate. A late payment penalty can be assessed. And the Commissioner General gains the recovery powers described below. Section 70 allows unpaid tax to be recovered "as a debt due to the Government" in any court of competent jurisdiction.

An objection changes the picture only once it is admitted. Under section 62(9), the balance of the assessed tax beyond the deposit is suspended until the objection is finally decided. Undisputed tax remains collectable throughout.

Who is affected?

Every Mainland taxpayer with arrears is exposed, from a sole trader with a presumptive tax balance to a group with a large transfer pricing assessment. Three other groups are often surprised:

• Banks, customers and tenants who owe money to a taxpayer, because they can receive an agency notice.
• Directors and senior managers, because section 76 can make them jointly liable in defined cases.
• Receivers and liquidators, because section 77 requires them to notify TRA within fourteen days of appointment.

How does a TRA agency notice to your bank work?

The agency notice is the tool most businesses meet first, and it is fast. Section 78(1) allows the Commissioner General, once a taxpayer fails to pay on time, to serve a written notice on anyone who owes money to that taxpayer. The notice requires that person to pay the money to TRA instead. Banks are the usual target, but customers, tenants and contract counterparties can receive one too.

The recipient must pay an amount equal to the tax due on the date stated in the notice (section 78(2)). That date cannot fall before the money becomes payable to the taxpayer or before the notice is served (section 78(3)). TRA must then serve the taxpayer with a copy (section 78(4)).

A recipient that cannot pay, for example because it owes nothing, must say so in writing within seven days of the notice (section 79(4)(b)). A recipient that ignores the notice and fails to pay within thirty days of the specified date can itself be pursued for the amount (section 79(7)). The notice ceases to have effect once the tax is paid or otherwise satisfied (section 79(2)).

In practice, a bank will freeze and remit the balance. Payroll and supplier payments then fail. That is why we advise clients to engage TRA on a payment plan before the account is hit, not after.

Can TRA seize and sell your goods or land?

Yes, through a charge followed by a sale. Section 72 allows the Commissioner General to create a charge in favour of the Government over any assets of a taxpayer who has not paid on time. The charge is created by written notice naming the taxpayer, the TIN, the assets, the tax and the sale power (section 72(2)). It secures the tax, the interest under section 87 and the costs of charge and sale (section 72(3)).

For land and buildings, the charge takes effect when TRA applies to register it, and the Registrar of Titles registers it without fee (sections 72(4) and 72(6)). Once you pay in full, the Registrar must remove the entry within thirty days, again without fee (section 72(7)).

Section 73 governs the sale. TRA must first serve a notice of intention to sell, stating the method and timing and, for tangible assets, how possession will be taken. Police may assist entry to the premises named, and an inventory must be given when assets are taken. Sale is ordinarily by public auction. The earliest sale dates under section 73(5) are:

• Land or buildings: thirty days after taking possession.
• Perishable goods: one day after taking possession.
• Other tangible assets: fourteen days after taking possession.
• Any other case: ten days after service of the notice of intention to sell.

The Finance Act, 2026 (Act No. 2 of 2026, in force 1 July 2026) amended section 73(4) so that perishable charged goods may be sold to prevent deterioration. Clyde & Co's Finance Act 2026 note reads the change as allowing sale by auction or private treaty. Proceeds go first to the costs of charge and sale (section 73(6)(a)).

Seizure is the point at which an advocate should be on the file. Defects in the notice, the inventory or the timing can matter, and only an advocate can take the matter to court.

Can TRA close your premises over tax?

The Act does not contain a general power to close a business for arrears. Section 75 allows TRA to restrain goods, vehicles and other assets, search premises, and mark, lock or seal a building, room or container. Those powers apply only where section 75(2) is met. The listed triggers include unpaid VAT on a supply or import, unpaid road, fuel or vehicle charges, breach of section 44 (fiscal receipts) or of the excise law.

A restraint lasts only long enough to raise a jeopardy or adjusted assessment (section 75(6)). If nobody proves ownership in that time, the assets can be treated as charged and sold under section 73 (section 75(7)).

Policy has also moved. On 19 October 2026 the Commissioner General, Yusuph Mwenda, told traders in Kilombero that "no business will be closed over tax challenges", according to TRA's news release. The Respondents reported the same remarks and stressed that staying open does not cancel the debt. This is a statement of policy, not an amendment to the Act, so the statutory powers above remain available.

Can TRA stop you leaving Tanzania?

Yes, for individuals in a narrow case. Section 74 applies where a person fails to pay tax on time and is likely to flee the United Republic. The Commissioner General may then notify the Director of Immigration Services, who must prevent departure for fourteen days from service of the notice (section 74(2)).

TRA must withdraw the notice once the person pays or makes arrangements satisfactory to the Commissioner General (section 74(3)). Only the High Court can extend the fourteen days, on TRA's application (section 74(4)). A person facing a departure restraint should instruct an advocate the same day.

Are directors personally liable for company tax debts?

Section 76 makes a manager, or a person who was a manager when the default occurred, jointly and severally liable with the entity for unpaid tax. "Manager" is defined widely in section 3. It covers directors, officers, partners, trustees and anyone whose directions the entity follows.

The R.E. 2023 text we read narrows this. Section 76(2) applies the liability only where the default was due to fraud proved in a court of law. The R.E. 2019 text instead gave a defence for managers who used due care, diligence and skill. We could not confirm from an independent source which amending Act made the change, so treat the point as one to confirm. A manager who pays can recover from the entity under section 76(3). Our guide to directors' duties in Tanzania covers the wider picture.

Section 77 covers receivers. A receiver must notify TRA within fourteen days of appointment or taking possession of assets in the United Republic. TRA can then require funds to be set aside for tax before other distributions.

TRA tax debt recovery: payment plans and remission

Two statutory doors lead out of enforcement without litigation.

Extension and instalments (section 66). A taxpayer may apply in writing for more time to pay. Where good cause is shown, the Commissioner General may extend the date for all or part of the tax, and may allow instalments. The decision must be in writing. If an instalment is missed, the whole balance plus interest becomes payable at once (section 66(4)).

Remission of interest and penalty (section 81). Where the Commissioner General is satisfied there is good cause, he may remit all or part of the interest or penalty. Principal tax cannot be remitted under this section. The R.E. 2019 version also allowed the Minister to set eligibility rules by regulation or Gazette order; the R.E. 2023 section 81 we read has no such subsection.

Is there a 2026 amnesty? Not of general application on the Mainland. We read Part XXI of the Finance Act, 2026, which amends Cap. 438 in sections 70 to 80, and found no remission or amnesty provision. The only current Mainland amnesty is the customs amnesty for motor vehicles covered in our motor vehicle customs amnesty guide. Zanzibar ran a 100 percent remission of interest and penalties from 1 July to 31 December 2025, reported by KPMG.

How do objections and the deposit rule fit in?

If the debt comes from an assessment you dispute, the objection route matters more than any payment plan. You must object within thirty days of service of the tax decision (section 62(1)). The objection is admitted only if, within thirty days, you pay the greater of the tax not in dispute or one third of the assessed tax (section 62(7)). The Commissioner General may waive or reduce that deposit for good reasons (section 62(8)).

TRA's objections and appeals page adds that a waiver request should be made within fifteen days. If the deposit is not paid, the assessment is treated as final (section 62(11)). Once admitted, TRA must decide within six months, failing which the assessment is treated as confirmed and appealable (section 63). FB Attorneys explain how admission starts that six-month clock.

The full appeal path is in our TRAB and TRAT appeal guide, and audit-stage tactics are in our TRA tax audit dispute guide.

Government fees and penalty bases

These are the statutory figures a debtor meets most often. Each line carries its Zatra fee register ID.

The interest rate itself is not a fixed number. It is the Bank of Tanzania discount rate in force at the time. Do not confuse it with the Central Bank Rate, which the Bank of Tanzania raised to 6.25 percent on 3 July 2026. PwC's Tanzania tax administration summary also describes late payment interest by reference to the discount rate, compounded.

Worked example: a TZS 48 million VAT debt

Mfano Distributors Ltd is a hypothetical Dar es Salaam wholesaler. It owes TZS 48,000,000 of VAT that fell due four months ago. It has no objection pending. The rates below are illustrative only: we use 1 percent a month for interest because we could not verify the current Bank of Tanzania discount rate.

Interest continues to run on the unpaid balance while the plan runs, so the actual figures will move. If Mfano misses one instalment, the whole balance becomes payable at once. Mfano can also apply under section 81 to remit some or all of the TZS 6,748,992 of interest and penalty, showing good cause such as delayed government receivables.

Now assume instead that Mfano disputes TZS 30,000,000 of an assessed TZS 48,000,000. The undisputed tax is TZS 18,000,000 and one third of the assessment is TZS 16,000,000. The deposit is the greater figure, TZS 18,000,000.

Key dates

What to do now

1. Confirm the debt. Pull your taxpayer ledger and reconcile every assessment, return and payment. Separate principal, interest and penalty, and mark anything you dispute.
2. Protect your objection rights. If any assessment is less than thirty days old and wrong, file the objection and arrange the deposit or a waiver request now.
3. Apply for a payment plan in writing. Use section 66 before an agency notice lands. Propose instalments you can meet, supported by cash flow figures.
4. Ask for remission. Apply under section 81 for interest and penalty relief, showing the good cause behind the arrears.
5. Brief your bank and directors. Tell the bank how to handle an agency notice, and make sure directors know their position under section 76.
6. Instruct an advocate early. Any notice of intention to sell, departure restraint, prosecution threat or dispute over a charge needs an advocate the same day.

How Zatra helps

Zatra's TRA audit and dispute team reconciles ledgers, prepares section 66 payment plan applications and section 81 remission requests, and drafts objections against the deadlines above. Our tax compliance service then keeps returns current so the same arrears do not rebuild. Clearing arrears is also the route back to a tax clearance certificate, which licence renewals need.

Government fees, tax, interest and penalties are paid to TRA at the official rate against a control number. They are separate from Zatra's professional fee, which we quote in writing before work starts. Zatra does not decide or guarantee any authority's outcome. TRA decides payment plans and remission, and the Board, Tribunal and courts decide disputes.

Seizure challenges, prosecution, departure restraints, court suits and formal legal opinions are matters for an advocate of the High Court. We work alongside your advocate or introduce one. To start, contact Zatra with your TRA ledger and any notices received.

Sources and status

Accurate as at 2 November 2026.

• Tax Administration Act, Cap. 438 R.E. 2023. Tanzania Revenue Authority, R.E. 2023 (file headers dated 2025). Accessed 2 Nov 2026.
• Tax Administration Act, Cap. 438 R.E. 2023 (TRAB copy). Tax Revenue Appeals Board, R.E. 2023. Accessed 2 Nov 2026.
• Tax Administration Act, R.E. 2019 version. TanzLII, version of 30 November 2019. Accessed 2 Nov 2026.
• The Finance Act, 2026 (Act No. 2 of 2026). Tanzania Revenue Authority, assented 30 June 2026. Accessed 2 Nov 2026.
• Law governing tax objections and appeals. Tanzania Revenue Authority, undated page, 2026. Accessed 2 Nov 2026.
• CG Mwenda reassures businesses: no business will be closed over tax challenges. Tanzania Revenue Authority, 19 October 2026. Accessed 2 Nov 2026.
• Acts and regulations. Zanzibar Revenue Authority, list updated 6 August 2026. Accessed 2 Nov 2026.
• Monetary Policy Committee statement. Bank of Tanzania, 3 July 2026. Accessed 2 Nov 2026.
• Tanzania: corporate tax administration. PwC Worldwide Tax Summaries, reviewed 9 September 2026. Accessed 2 Nov 2026.
• Tanzania tax update: Finance Act 2026 highlights. Clyde & Co, 3 July 2026. Accessed 2 Nov 2026.
• Admission of objection. FB Attorneys, 14 June 2026. Accessed 2 Nov 2026.
• Tanzania (Zanzibar): tax amnesty for remission of interest and penalties. KPMG TaxNewsFlash, 15 December 2025. Accessed 2 Nov 2026.
• TRA shifts tax enforcement, allows indebted businesses to stay open. The Respondents, 21 October 2026. Accessed 2 Nov 2026.

Figures to confirm before you act

• The current Bank of Tanzania discount rate used as the statutory interest rate: confirm with TRA or the Bank before computing interest.
• Monthly compounding under section 87: read in the R.E. 2019 equivalent (section 76); confirm the section against the R.E. 2023 Act.
• Section 76(2) fraud condition for managers' liability: read in the R.E. 2023 text, amending Act not independently confirmed.
• Section 89 late payment penalty and section 94 offence wording: confirm the section against the Act.
• Recovery powers under Zanzibar's Tax Administration and Procedures Act No. 7 of 2009: confirm with ZRA.

This article is general information based on official sources available at the date of publication. It is not legal, tax or financial advice. Laws and notices change. Verify with the issuing authority or consult Zatra before acting.