Employer of Record in Tanzania

Hiring Employees in Tanzania With An EOR

Hiring in Tanzania can seem complex – but with the right facts and tools, it’s simple. This guide walks you through the local job market, shows how Employer of Record services guarantee compliance, and highlights the key labor laws you need to know.

Hiring Employees In Tanzania
Employer Of Record In Tanzania

Capital City

Dodoma

Currency

Tanzanian Shilling

 (

TSh

)

Timezone

GMT +3

Payroll Frequency

daily / weekly / bi-weekly / monthly

Tax Year

1 July - 30 June

Employer Tax

15%

Languages

English

Swahili

Jesse Weisz

R&D Analyst

Last Updated

September 10, 2025

In This Guide

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Employment Guide For Hiring in Tanzania

Looking to grow your team in Tanzania? It’s a great way to tap into new talent and fresh markets – but hiring across borders comes with its own set of hurdles. From understanding local labor laws to managing payroll and staying compliant, it gets complex if you don’t have local HR support.

Playroll’s full-service Employer of Record platform handles all the heavy lifting so you can hire confidently in Tanzania without setting up a local entity. In this guide, we’ll break down everything you need to know about hiring employees in Tanzania, including employment contracts, payroll, statutory benefits, and compliance with local labor laws.

What to Know Before Hiring employees in Tanzania

Tanzania has seen remarkable economic growth, averaging nearly 7% annual GDP increase since 2000, positioning itself as a leading economy in Africa.

The active involvement of the private sector has been instrumental, driving employment, innovation, tax revenue, and fair competition.

Labor Laws: An Employer of Record acts as the legal employer for workers in Tanzania, taking on key responsibilities to ensure compliance with local labor laws and regulations. 

Transit trade plays a vital role in economic growth and local enterprise development, with the government promoting it to enhance prosperity.

Notably, the removal of value-added tax (VAT) on ancillary transit services underscores the importance of transit trade in facilitating economic transformation and regional trade, showcasing its significance in Tanzania's economic landscape.

How to Hire Employees In Tanzania

Hiring in Tanzania for the first time can be overwhelming, especially when navigating unfamiliar employment laws. So, how do you get started? There are three main ways to hire in Tanzania: Set up your own legal entity, hire independent contractors, or use an EOR service to handle payroll and global HR for you. Below, we’ll walk you through each option in detail.

1. Set Up A Local Entity In Tanzania

Setting up a local entity in Tanzania is the traditional route for businesses that want to build a long-term presence in a new market. It allows for direct hiring, fine control over operations, and compliance with local labor laws.

That said, the process is rarely simple. It involves navigating complex legal structures, extensive registration procedures, ongoing payroll administration, and local tax obligations. Beyond the administrative burden, the costs of incorporation, maintaining local offices, and hiring compliance experts can quickly add up.

For companies operating with slim margins or testing new markets, these financial and operational commitments often make setting up a local entity an unfeasible option compared to more flexible and cost-effective solutions.

2. Use An Employer Of Record In Tanzania

An Employer of Record (EOR) acts as the legal employer for workers in Tanzania, taking care of compliance, payroll, and local labor regulations. This makes it fast and straightforward to bring on talent without the cost and complexity of setting up a local entity. For businesses looking to test new markets or scale teams across borders with confidence, EORs offer a flexible, low-risk solution.

The Employer of Record in Tanzania is responsible for:

  • Employment Compliance: Ensure all employment contracts comply with Tanzania's labor laws and regulations, including proper classification of employees.
  • Payroll Management: Calculate, process, and distribute employee salaries in accordance with Tanzania's payroll laws, including deductions for taxes and social security contributions.
  • Tax Filing and Contributions: Handle the registration, filing, and payment of employer taxes and social security contributions to the relevant authorities.
  • Employment Contracts: Draft and maintain compliant employment agreements, detailing salary, benefits, working hours, and termination terms in line with Tanzania's legal requirements.
  • Benefits Administration: Provide mandatory employee benefits as required by Tanzania's labor laws, such as health insurance, pension contributions, and statutory leave.

3. Hire Independent Contractors In Tanzania

Hiring independent contractors has boomed in popularity because of the cost savings and flexibility they offer. It can be a great option if you require niche skills or short-term project support. Contractors allow businesses to access specialized skills quickly, without the time and cost of setting up a local entity.

However, it’s important to know the limits of this model: contractors are not a substitute for full-time employees. Relying on them for ongoing, long-term roles can create serious compliance risks, including employee misclassification, which can lead to fines, back taxes, and reputational damage.

Playroll’s contractor management solutions make it simple to compliantly engage, onboard, and pay contractors around the world. We provide clear visibility into agreements, streamline payments, and reduce compliance risks – so you can focus on getting the work done. And when you’re ready to take the next step, we can help seamlessly convert contractors into full-time employees through our global Employer of Record service.

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Labor Laws in Tanzania

Businesses can only operate smoothly in Tanzania if they comply with local labor laws including drafting compliant employment contract agreements and meeting taxation and payroll obligations. Learn more about the employment laws and regulations in Tanzania below, to avoid any compliance issues.

Employment Contract Requirements

The labour laws in Tanzania mandate that all employees, excluding those with less than 6 days of employment, must be provided with a written employment contract, whether it is of a definite or indefinite nature. This contract is required to encompass the following necessary details:

  • Identification of the employee
  • Place of recruitment
  • Job description
  • Starting date
  • Form and length of contract
  • Workplace and working hours
  • Compensation and method of calculation
  • Benefits and bonuses

Onboarding Process

We can help you get a new employee started in Tanzania quickly, with a minimum onboarding time of just 1-2 working days. The timeline starts once the employee submits all required information onto the Playroll platform and completes any necessary local authority registrations.

For non-nationals, the Right to Work assessment (if applicable) may add up to three extra days. Additional time may be needed for follow-ups on this assessment. Please note, payroll cut-off dates can impact the actual start date. Playroll's payroll cut-off date is the 10th of each month unless otherwise specified.

Working Hours in Tanzania

In Tanzania, a standard work week comprises 45 hours, with a maximum of 9 hours per day. Additionally, employees may be obligated to work for 6 days a week under the applicable labour regulations.

Overtime in Tanzania

In Tanzania, overtime requires mutual agreement between the employee and employer, with a maximum limit of 12 hours worked in a day. The cumulative overtime hours are limited to 50 hours within a 4-week period, compensated at a rate of 150% of the regular pay. On public holidays, the compensation for hours worked is set at 200% of the regular pay rate.

Probation Period in Tanzania

In Tanzania, there is no specific legal requirement for probation periods. However, it is specified that employees cannot assert a claim of unfair dismissal if termination occurs within the initial 6 months of service.

Average Salary In Tanzania

As of 2025, the average monthly salary in Tanzania is approximately 513,261 Tanzanian shillings (TZS), equivalent to about $190 USD. However, this figure can vary significantly based on factors such as industry, experience, education, and location. For instance, professionals in sectors like information technology, finance, and engineering often earn higher wages compared to those in agriculture or education. Additionally, urban areas like Dar es Salaam and Arusha typically offer higher salaries due to increased demand and living costs.Tanzania's economy is projected to grow by around 6% in 2025, driven by sectors such as agriculture, transport, construction, and trade. Inflation has remained stable, with rates ranging between 3.05% and 3.97%, creating a favorable environment for investment and economic growth. These economic conditions contribute to a more stable labor market and may influence salary levels across various sectors.

Not sure what to pay in Tanzania? Compare fair, local salaries with our free benchmarking tool.
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Working Hours in Tanzania

Minimum Wage in Tanzania

How an Employer of Record Helps You Hire in Tanzania

Setting up a local legal entity in Tanzania can be time-consuming and expensive. It often involves complex paperwork, local representation, banking, registrations, and ongoing tax filings, which isn't cost-effective if you're simply looking to hire a few employees or test the market. An Employer of Record removes these barriers entirely. Instead of spending months establishing a presence, an EOR lets you hire and onboard employees within days while staying fully compliant.

This enables faster market entry and greater agility. Whether you’re launching a pilot program, supporting a regional client, or adding specialized talent, you don't need to commit to long-term infrastructure to explore new business opportunities. The EOR handles local employment logistics while you retain day-to-day oversight of your hires. This model lets you scale up or down based on business needs, giving you more flexibility with less overhead and risk.

Payroll Management in Tanzania

Fiscal Year in Tanzania

1 July - 30 June is the 12-month accounting period that businesses in Tanzania use for financial and tax reporting purposes.

Payroll Cycle in Tanzania

The payroll cycle in Tanzania is usually daily / weekly / bi-weekly / monthly, with employees being paid by the end of the month.

Minimum Wage in Tanzania

As of July 2025, Tanzania's minimum wage varies by region and sector. For public servants, the minimum wage has been raised from TZS 370,000 to TZS 500,000. In the private sector, wages range from TZS 40,000 for domestic workers to TZS 400,000 for industries such as financial services, telecommunication, and international companies.​

Bonus Payments in Tanzania

There are no legal provisions in Tanzania concerning 13th-month salaries.

Employment Taxes in Tanzania

Employer Tax Contributions

Employer payroll contributions are generally estimated at an additional 15% on top of the employee salary in Tanzania.

Tax TypeTax Rate
Skills Development Levy3.5%
Workers Compensation Fund0.5%
National Social Security Fund10%

Employee Payroll Tax Contributions

In Tanzania , the typical estimation for employee payroll contributions cost is around 10%.

Tax TypeTax Rate
National Social Security Fund10%
Higher Education Student Loan BoardWhen applicable

Individual Income Tax Contributions

Individuals who are residents in Tanzania, excluding short-term residents, are obligated to pay income tax on their global income. The following are employee income taxes in Mainland Tanzania.

Income BracketTax Rate
0 - 270,000 TZS0%
270,001.00 TZS - 520,000.00 TZS8%
520,001.00 TZS - 760,000.00 TZS20% on the excess of 520,001 TZS + 20,000 TZS
760,001.00 TZS - 1,000,000.00 TZS25% on the excess of 760,001 TZS + 68,000 TZS
1,000,001.00 TZS And above30% on the excess of 1,000,001.00 TZS + 128,000 TZS

Pension in Tanzania

In Tanzania, employees aged 60 or above qualify for old-age pension with a minimum contribution of 180 months (NSSF, LAPF, and PSPF) or 120 months (PPF). Pension can also be received at any age due to permanent emigration, provided covered employment ceases.

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The tax-related information provided in this guide is intended for general guidance and informational purposes only. Reach out to our dedicated team for insights on remote hiring in Tanzania tailored to your needs.

Employment Taxes and payroll in Tanzania

Payroll and employment taxes in Tanzania are vital for businesses to manage effectively, including PAYE, social security contributions, and local levies. Ensuring timely tax submissions and correct payroll calculations is critical to avoid penalties.

Using payroll management software, such as Playroll, can streamline the process, helping businesses stay compliant with Tanzanian regulations.

How an EOR Helps You Run Payroll in Tanzania

One of the biggest risks in global hiring is payroll mismanagement. In Tanzania, even small errors in tax reporting or social contribution payments can trigger audits, fines, or reputational damage. For companies without in-country expertise, the risk isn’t worth taking. An Employer of Record removes this burden by owning the legal responsibility of payroll, executing every step with built-in compliance.

Key Ways an EOR Supports Payroll in Tanzania:

  • Mitigates Compliance Risk: Oversees all legal obligations for payroll, tax filings, and recordkeeping.
  • Local Regulatory Expertise: Interprets and applies Tanzania’s latest labor and tax changes in real time.
  • Free Processing: Reduces mistakes in wage calculations and reporting through built
  • Payroll Record Management: Maintains compliant payroll audit trails and documentation for each employee.

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Work Permits & Visas in Tanzania

In Tanzania, work permits and visas are essential for employers hiring foreign workers. The process involves submitting applications, paying fees, and meeting specific eligibility criteria. The key visa types include the Class A Work Permit for investors and self-employed individuals, the Class B Work Permit for skilled professionals, and the Class C Work Permit for missionaries, volunteers, and non-profit workers. Employers must ensure compliance with Tanzanian labor laws when sponsoring foreign employees. Processing times typically range from up to two months for work permits and 5 to 10 days for visas, and renewal options are available to extend permits as needed. Employers can also simplify the process by partnering with an Employer of Record (EOR) to handle payroll, compliance, and administrative responsibilities.

Annual Leave & Company Policies In Tanzania

Mandatory Leave Entitlement in Tanzania

The annual leave entitlement in Tanzania is 28 days for a full time worker. These can include public holidays on top of that or within those days, which would otherwise be unpaid.

Public Holidays In Tanzania

Tanzania observes a total of 16 public holidays in a year:

HolidayDate
New Years Day1 January
Zanzibar Revolution Day12 January
Karume Day7 April
Good FridayMarch/April, day changes yearly
Easter MondayMarch/April, day changes yearly
Union Day26 April
Eid al-FitrMarch/April, day changes yearly
Labor Day1 May
Saba Saba Day7 July
Eid al-AdhaJune/July, day changes yearly
Nane Nane Day8 August
Maulid DaySeptember, day changes yearly
Nyerere Day14 October
Independence Day9 December
Christmas Day25 December
Boxing Day26 December

Paid Time Off in Tanzania

Employees who have been employed for at least 6 months are entitled to 28 days of consecutive leave per year.

Maternity Leave In Tanzania

In Tanzania, pregnant employees are entitled to 84 days of paid maternity leave. If the employee gives birth to two or more children, the leave is extended to 100 days. It is a requirement for the employee to inform her employer at least 3 months before the expected due date. As of March 14, 2025, mothers of premature babies are entitled to extended maternity leave until the baby reaches 40 weeks of gestation.

Paternity Leave In Tanzania

Fathers in Tanzania are entitled to three days of paid paternity leave, to be taken within the first seven days following the birth of the child. With effect from March 14, 2025, fathers of premature children are entitled to 7 consecutive days of paternity leave.

Sick Leave In Tanzania

Employees employed within a 36-month cycle in Tanzania, and who provide a medical certificate, are entitled to 126 days of paid sick leave. The initial 63 days will be compensated at 100% of their regular pay rate, while the following days will be paid at a rate of 50%. To qualify for sick leave, an employee must have worked with the same employer for at least six months in the year preceding the sickness.

Parental Leave In Tanzania

Tanzania's labor laws provide distinct leave entitlements for mothers and fathers but do not include a shared parental leave policy.

Annual Leave and Company Policies In Tanzania

Employee Benefits in Tanzania

Using an Employer of Record to Administer Benefits in Tanzania

In Tanzania, benefits play a central role in attracting and retaining top talent. Employees often expect more than just a paycheck – they're looking for stability, healthcare coverage, pension plans, and other perks that show a company is invested in their well-being. If you're not familiar with what’s standard or required, you risk falling short. An Employer of Record helps bridge that gap by administering a locally competitive benefits package that meets both legal requirements and employee expectations.

An EOR doesn't just check boxes, they make sure your employees receive benefits that are timely, properly communicated, and well-managed from the moment they’re onboarded. From managing healthcare contributions to adjusting for regional differences in leave or bonus entitlements, an EOR acts as both a legal and operational partner. The result is a better employee experience, less administrative burden on your internal team, and greater confidence that your offer is aligned with what top candidates in Tanzania actually want and need.

Termination and Severance Policies in Tanzania

Employment Termination and Severance Policies in Tanzania

Termination Process in Tanzania

Termination in Tanzania requires the provision of a written notice, which indicates the reason for termination and the specified termination date.

Notice Period in Tanzania

Notice periods in Tanzania, although permissible to be compensated instead, depend on the type of employee service:

  • First month of service: 7 days' notice
  • Employees on a daily or weekly basis: 4 days' notice
  • Employees on a monthly basis: 28 days' notice

Severance in Tanzania

In Tanzania, employees are eligible for severance pay after completing 12 months of service. The severance pay is calculated at 7 days' pay for each year of service, with a maximum cap set at 10 years.

Disclaimer

THIS CONTENT IS FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL OR TAX ADVICE. You should always consult with and rely on your own legal and/or tax advisor(s). Playroll does not provide legal or tax advice. The information is general and not tailored to a specific company or workforce and does not reflect Playroll’s product delivery in any given jurisdiction. Playroll makes no representations or warranties concerning the accuracy, completeness, or timeliness of this information and shall have no liability arising out of or in connection with it, including any loss caused by use of, or reliance on, the information.

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ABOUT THE AUTHOR

Jesse Weisz

Jesse is an experienced R&D Analyst at Playroll, a leading Employer of Record (EOR) provider. With a strong background in data analysis and market research, Jesse specializes in identifying emerging trends and driving innovation in global HR solutions. She is an all-rounder, critical thinker and success-seeker (often inextricably linked to being a late-night tea drinker).

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FAQs About Hiring in Tanzania

What is the minimum wage in Tanzania

As of January 1, 2024, Tanzania's minimum wage rates are:

  • TZS 100,000 per month.
  • Rates vary by sector and occupation.
  • Subject to periodic review by the government.

What is the average salary in Tanzania?

The average monthly salary in Tanzania is approximately 513,261 TZS ($190 USD). Salaries can vary based on industry, experience, education, and location, with urban areas and certain sectors offering higher wages.

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