The silent cashflow leak hiding in your VAT returns

Most business owners track cashflow obsessively from debtors, bank balances to payment cycles. But there is a cashflow leak that almost no one is watching  and it is sitting quietly inside

your VAT returns right now.

It starts with a supplier invoice that never appears in TaRMS.

How VAT input tax is supposed to work

When your business buys goods or services from a VAT-registered supplier, you pay VAT on that purchase. You are entitled to claim that VAT back as input tax  effectively reducing the VAT you owe ZIMRA at the end of the period.

That reclaim is real money. At 15.5%, a business spending $50,000 a month on taxable inputs is entitled to $7,750 back every single month. Over a year, that is $93,000 in cashflow that belongs to your business.

But only if the invoices are properly fiscalised.

What “not fully fiscalised” actually means

Since mid-2025, a valid tax invoice in Zimbabwe is no longer just a document with the right fields filled in. It must be generated by a ZIMRA-registered fiscal device and transmitted in real time to the Fiscalisation Data Management System (FDMS). That data then flows automatically into your TaRMS account, where it pre-populates your input tax schedule.

If your supplier has not fiscalised or has a fiscal device that is registered but not transmitting correctly  their invoice never arrives in your TaRMS account. It does not matter that you have the paper copy. It does not matter that VAT was charged. ZIMRA’s system simply does not see it, and your claim is denied.

The invoice looks legitimate. The VAT was paid. But the cashflow never comes back.

Why so many invoices are not appearing

This is more widespread than most businesses realise, and it comes down to three causes.

The first is incomplete fiscalisation. Many suppliers registered their fiscal devices but never properly integrated them with FDMS. The machine looks like it is working. Nothing is transmitting.

The second is silent device failure. A device that was fully compliant at setup can develop transmission errors over time, a software update, a connectivity issue  and no one notices. The supplier keeps issuing invoices. Your claims quietly stop arriving.

The third is incorrect buyer details. Even where a supplier’s device is working perfectly, a wrong TIN or VAT number means the invoice cannot be matched to your TaRMS account. It exists in the system just not yours. Every time you receive an invoice, confirm your TIN and VAT number on their system are correct. It is a thirty-second check that protects thousands of dollars in claims.

None of these suppliers are acting in bad faith. Most simply do not know. But the financial consequence is yours  input tax you paid and cannot recover. A legitimate-looking invoice is no longer proof of a claimable one.

What this looks like in practice

Take a construction business purchasing materials, plant hire, and subcontracted labour. On paper, their monthly VAT inputs might total $180,000 entitling them to $27,900 in input tax reclaims. But if a third of those invoices are not appearing in TaRMS due to supplier fiscalisation gaps, the business is only recovering $18,600. The remaining $9,300 per month $111,600 per year  is gone. Not deferred. Gone.

That is not a tax technical issue. That is a cashflow crisis building slowly in the background.

Three things to do this week

First, log into TaRMS and pull your input tax schedule for the last three months. Compare it against your purchase invoices for the same period. Any invoice absent from TaRMS is a denied claim.

Second, identify which suppliers are generating the gaps. In most businesses, 80% of input tax comes from 20% of suppliers. Start there. Contact them, ask whether their fiscal device is integrated with FDMS, and give them the opportunity to rectify.

Third, build a simple monthly reconciliation into your close process. Before you file your VAT return, cross-check your purchase records against TaRMS. Do not file a return that leaves recoverable input tax on the table.

The bigger picture

ZIMRA has built a system where your input tax claims are only as good as your suppliers’ compliance. That is the reality of TaRMS and FDMS working together. You cannot control what your suppliers do but you can audit the outcome, catch the gaps, and either recover what you are owed or make informed decisions about who you continue to do business with.

Cashflow lost to unfiscalised invoices is quiet, cumulative, and entirely avoidable.

The businesses that build this check into their monthly routine will recover it. The ones that don’t will keep funding a leak they never knew existed.

Mazano Advisory helps businesses reconcile TaRMS input tax schedules, identify supplier fiscalisation gaps, and recover VAT positions that have been silently eroding cashflow. To understand what your business may be leaving on the table, reach out to us.

info@mazanoadvisory.co.zw | +263 714 667 075 | www.mazanoadvisory.co.zw