- Both personal and business account holders will pay VAT.
- Zimbabwe has to pay value-added tax for Facebook ads.
- Facebook advertisers should register their Ads accounts.
Facebook has set value-added tax (VAT) for Zimbabwe, it is setting business standards during this period of lockdowns caused by the global pandemic of COVID-19 where people are rushing on social media platforms to boost their businesses through advertisements, therefore Facebook ads will be on tax rate as of 1 September 2020.
VAT is accounted for the applicable rate when the ad account is funded to determine the total balance available. The rate will only be applicable to the advertisers whose business or personal account’s ‘sold to’ address is Zimbabwe because VAT is added on top of charges, you won’t reachable your billing threshold faster, but you may be charged more than your billing threshold amount.
Facebook said that advertisers should add their VAT identification number in the Ad accounts settings of Ads Manager, this may help them recover any VAT that they paid to Zimbabwe tax authorities if they’ve got a VAT-registered business in Zimbabwe because VAT ID will show up on ad receipts. If advertisers pay for Facebook ads with a prepaid payment method, VAT will be added on top of charges and it will be more than the billing threshold amount.
The change was not meant for Zimbabwe only but for other countries like India, Belgium Spain,Norway just to mention a few. Regardless of whether advertisers are purchasing Facebook ads for business or personal purposes they have to pay the tax.Facebook also added Goods and Services Tax (GST) and Tax Deducted at Source (TDS) refunds for India.
The business standards set by Facebook for Zimbabwe, adding VAT at the applicable local tax rate to the cost of Facebook ad purchase. However, Facebook is not providing tax advice rather it is referring the advertisers to their tax advisors or the local tax authorities.