INCOME TAX ACT, 2015 (ACT 896), SS 115 – 139

INCOME TAX ACT, 2015 (ACT 896)
115. Withholding from investment returns

(1) Subject to subsection (2), a resident person shall withhold tax at the rate specified in paragraph 8 of the First Schedule where that person

(a) pays any dividend, lottery winning, interest, natural resource payment, rent or royalty to another person; and

(b) the payment has a source in the country.

(2) This section does not apply to

(a) payments subject to withholding under section 114;

(b) payments made by an individual, unless made in conducting a business;

(c) interest paid to a resident financial institution; or

(d) a payment that is an exempt amount.

116. Withholding from supply of goods, service fees and contract payments

(1) Subject to subsection (3), a resident person shall withhold tax at the rate provided for in paragraph 8 of the First Schedule where that person

(a) pays a service fee with a source in the country to a resident individual

(i) as fees or allowances, to a resident director, manager, trustee or board member of a company or trust,

(ii) for examining, invigilating, supervising an examination, or part time teaching or lecturing;

(iii) as an endorsement fee;

(iv) as a commission to a resident lotto receiver or agent

 (v) as a commission to a sales agent;

(vi) as a commission to a resident insurance sales or canvassing agent;

(vii) for any other supply of services; or

(viii) for any other matter prescribed by Regulations; or

(b) pays a service fee or an insurance premium with a source in the country to a non-resident person.

(2) A resident person, other than an individual, shall withhold tax on the gross amount of the payment at the rate specified in the First Schedule when the person makes a payment to another resident person who does not fall within subsection (1) or section 114 for

(a) the supply or use of goods,

(b) the supply of any works, or

(c) the supply of services, in respect of a contract between the payee and the resident person

(3) Subsection (2) applies to a contract between the payee and a resident person, where the amount of the contract exceeds two thousand currency points.

(4) For the purpose of determining whether a contract qualifies under subsection (3), two or more contracts in respect of the same goods, works or services shall, be treated as a single contract.

(5) Subsection (2) does not apply

(a) 10 a premium paid to it resilient insurance company;

(b) 10 payments under it contract for the sale of goods which constitute trading stock of both the vendor and the purchaser;

(c) where the Commissioner-General,

(i) for a good cause shown, exempts in writing a person from deducting tax under that subsection in respect of an institution of a specific contract entered into by an institution upon an application made by the institution; or

(ii) is satisfied that a person has a satisfactory tax record and exempts in writing that person from the application of that subsection or exempts specific contracts entered into by that person from that application

(6) A person who is granted an exemption under paragraph (b) of subsection shall, at the end of every calendar quarter, submit a list of particulars of all payments which would have fallen within subsection (2) but for the exemption.

(7) Subject to subsection (8) The Minister may by legislative instrument, make Regulation to prescribe

(a) that a resident person shall withhold tax when the person makes a payment to a non-resident person of a type referred to in section 105 (g) or (h) in respect of land, sea or air transport or telecommunications services; and

(b) the rate at which the tax referred In in paragraph (a) shall be withheld,

(8) This section does not apply to

(a) a payment subject to withholding under section 114;

(b) a payment made by an individual; or

(c) a payment that is an exempt amount.

(9) A resident person shall withhold tax at the rate specified in the First Schedule when the person makes a payment to a non-resident person for the rendering of management and technical services.

(10) A resident person shall withhold tax at the rate specified in the First Schedule from a payment made under a contract with a non- resident person for

(a) the supply of goods or works, or

(b) the supply of any services where the contract gives rise to income from the country.

(11) Where subsection (10) applies, the resident person shall within thirty days of the date of entering into the contract, give notice to the Commissioner-General in writing of

(a) the nature of the contract;

(b) the likely duration of the contract;

(c) the name and postal address of the non-resident person to whom payments under the contract are to be made; and

(d) the total sum estimated to be payable under the contract to the non-resident person.

(12) Subsection (10) does not apply to other payments which are subject to final withholding tax applicable to non-residents under this Act.

117. Statement and payment of tax withheld or treated as withheld

(1) A withholding agent shall pay to the Commissioner-General within fifteen days after the end of each calendar month a tax that has been withheld in accordance with this Division during the month.

(2) A withholding agent shall file with the Commissioner-General within fifteen days after the end of each calendar month a statement in the form presented, specifying

(a) payments made by the agent during the period that are subject to withholding under this Division;

(b) the name, address and tax identification number of the withholdee;

(c) tax withheld from each payment; and

(d) any other information that the Commissioner-General may prescribe,

(3) A withholding agent who fails to withhold tax in accordance with this Division shall pay the tax that should have been withheld in the same manner and at the same time as tax that is withheld.

(4) A withholding agent who withholds tax under this Division and pays the tax to the Commissioner-General is treated as having paid the amount withheld to the withholdee for the purposes of any claim by the withholdee for payment of the amount withheld.

(5) A withholding agent who fails to withhold tax under this Division but pays the tax that should have been withheld to the Commissioner-General in accordance with subsection (1) is entitled to recover an equal amount from the withholdee.

(6) Subject to this Act and except where an agreement is ratified by Parliament a provision in an agreement which prohibits the deduction or withholding of a tax required to be deducted or withheld under this Act or any other enactment administered by the Commissioner-General is void.

118. Withholding certificate

(1) A withholding agent shall prepare and serve on a withholdee a withholding certificate, in the prescribed form,

(a) separately for each period referred to in subsections (3) and (4); and

(b) at the time specified in subsections (3) and (4).

(2) A withholding certificate shall specify

(a) the amount of payments made to the withholdee during the period; and

(b) the tax withheld by the withholding agent from the payments under this Division.

(3) Subject to subsection (4), a withholding certificate shall cover a calendar month and shall be served on the withholdee within thirty days after the end of the month.

(4) Where a tax is withheld under section 114, a withholding certificate

(a) shall cover the part of the calendar year during which the employee is employed; and

(b) shall be served on the employee by the 30" of January after the end of the year or, where the employee has ceased employment with the withholding agent during the year, not more than thirty days from the date on which the employment ceased.

119. Final withholding payment

(1) For the purposes of this Act, the following are final withholding payments:

(a) dividends paid by a resident company;

(b) rent paid to a resident individual under a lease of land or a building, with or without associated fittings and fixtures, situate in the country, other than rent received by an individual in conducting a business, sale or letting;

(c) rent other than rent received in conducting a business of sale or letting, paid to a person other than an individual under a lease of land or a building situate in Ghana, with or without associated fittings and fixtures;

(d) payments made to non-resident persons that are subject to withholding under this Division or would be subject to with- holding if sections 115(2)(b) and 116(8)(b) were ignored, other than payments derived through a Ghanaian permanent establishment.

(e) payments made to a subcontractor under section 71(4);

(f) payments made to a person under section 116(1)(a)(ii) and (iii); and

(g) lottery winnings.

(2) The following satisfy the tax liability of a withholdee under section 1(1)(b):

(a) tax withheld from a final withholding payment under this Division; and

(b) tax paid with respect to a final withholding payment in accordance with section 117(3).

(3) Where a final payment is not subject to withholding, by reason of the fact that the payer is a non-resident, the tax liability of the recipient under section 1(1)(8) with respect to the payment is payable by way of instalment and assessment.

(4) For the purposes of applying Divisions III and IV, the liability is treated as a liability under section 1(1)(a).

120. Credit for non-final withholding tax

(1) A withholdee of a payment which is not a final withholding payment is treated as having paid the tax

(a) withheld from the payment under this Division; or

(b) with respect to a payment in accordance with section 117(3).

(2) A withholdee is entitled to a tax credit in an amount equal to the tax treated as paid under subsection (1) for the year of assessment in which the payment is derived.

Division III: Tax payable by instalment
121. Payment of tax by quarterly instalment

(1) An instalment payer shall pay tax by quarterly instalments if the person derives or expects to derive assessable income during a year of assessment

(a) from a business or investment, or

(b) from an employment where the employer is not required to withhold tax under section 114.

(2) An instalment payer shall pay tax in instalments

(a) where the basis period of that instalment payer is a twelve month period beginning at the start of a calendar month, on or before the last day of the third, sixth, ninth and twelfth months of the basis period; or

(b) in any other case, at the end of each three-month period commencing at the beginning of each year of assessment and a final instalment on the last day of each year of assessment, unless it coincides with the end of one of the three- month periods.

(3) Subject to subsections (4) and (5), the amount of each instalment of tax payable by an instalment payer for a year of assessment is calculated according to the following formula;

                                                  [A-B]

_______

C

where-

        A      is the current estimated tax payable under this section or section 122 by the instalment payer for the year of assessment:

        B       is the sum of

(a) tax paid during the year of assessment, but prior to the due date for payment of the instalment, by the person by previous instalment under this section;

(b) tax withheld under Division II during the year, but prior to the due date for payment of the instalment, from payments received by the person that are included in calculating the income for the year of that person; and

(c) tax paid in accordance with section 117(1) that is paid to the Commissioner-General by a withholding agent or the person as withholdee during the year but prior to the due date for payment of the instalment: and

        C        is the number of instalments remaining for the year of assessment including the current instalment.

(4) The Minister may, by legislative instrument, make Regulations to prescribe for a particular class of persons to pay tax by instalments otherwise than or in substitution for instalments payable under this section.

(5) The Regulations under subsection (4) may prescribe

(a) that a particular or particular class of organised association or recognized occupational group collect from members of the organised association or recognised occupational group, tax payable by these members by instalment under this section;

(b) the terms and conditions under which the tax is to be collected; and

(c) the terms and conditions under which the association or recognised occupational group is to account to the Commissioner-General for the tax.

(6) An instalment payer is entitled to a tax credit for a year of assessment in an amount equal to the tax paid by way of instalment for the year.

(7) For the purposes of this section, “instalment payer” means a person who pays tax in quarterly instalments.

122. Statement of estimated tax payable

(1) A person who is an instalment payer for a year of assessment under section 121 shall file with the Commissioner-General by the date for payment of the first tax instalment an estimate of tax payable for the year.

(2) An estimate under subsection (1) shall, subject to any instructions by the Commissioner-General to the contrary,

(a) be in the form prescribed indicating an estimate of

(i) the assessable income of the person for the year of assessment from each employment, business and investment and the source of that income; and

(ii) the chargeable income of the person for the year and the tax to become payable with respect to that income under section 1(1)

(b) attach any other information that the Commissioner-General may require.

(3) Subject to subsection (6) and section 123(3), the tax referred to in subsection (2)(a)(ii) is the estimated tax payable by the person for the year of assessment.

(4) In estimating tax payable for a year of assessment under subsection (2)(a)(ii), a person may take into account

(a) a foreign tax credit to be claimed under section 112; and

(b) foreign income tax, only if the person has paid the tax or the person reasonably estimates that the tax will be paid during the year.

(5) The estimate of an instalment payer under subsection (1) remains in force for the whole of the basis period unless the person files a revised estimate with the Commissioner-General together with a statement of reasons for the revision.

(6) A revised estimate filed by a person under subsection (5) is the estimated tax payable by that person for the year of assessment, but only for the purposes of calculating instalments payable under section 121 after the date the revised estimate is filed with the Commissioner- General.

123. Statement of estimated tax payable not required

(1) The Commissioner-General may, by notice in writing, specify that an instalment payer or class of instalment payers is not required to submit an estimate under section 122.

(2)  Where an instalment payer is not required to submit an estimate by reason of subsection (1), the Commissioner-General shall

(a) make an estimate of the estimated tax payable by that person for the year of assessment, which may be based on the tax payable for the previous year of assessment with an upward adjustment; and

(b) serve on the instalment payer a written notice stating the estimate of the Commissioner-General and the manner in which the estimate is calculated.

(3) For the purposes of section 121, where the Commissioner-General serves a notice under subsection (2), the estimated tax payable by the person for the year of assessment is the amount estimated by the Commissioner-General.

Division IV: Tax payable on assessment
124. Return of income

(1) Subject to section 125, a person shall file with the Commissioner-General not later than four months after the end of each year of assessment a return of income for the year.

(2) A return of income of a person for a year of assessment shall, subject to any instructions by the Commissioner-General to the contrary

(a) be in the prescribed form and specify

(i) the assessable income of the person for the year from each employment, business and investment and the source of that income;

(ii) the chargeable income of the person for the year and the tax payable with respect to that income under section 1(1)(a);

(iii) tax paid by the person for the year by withholding, instalment or assessment for which a tax credit is available under section 120 or 121; and

(iv) the remainder of the tax to be paid for the year calculated as the sum of the tax referred to in subparagraph (ii) less the tax already paid under sub paragraph (iii);

(b) have attached

(i)  any withholding certificates supplied to the person under section 118 with respect to payments derived by the person during the year; and

(ii) any other information that the Commissioner- General may require.

125. Return of income not required

(1) Subject to subsection (2), a return of income for a year of assessment is not required under section 124 from a resident individual

(i) who has no tax payable for the year under section 1(1)(a); or

(ii) whose tax payable for the year under section 1(1)(a) relates exclusively to income from employment subject to withholding under section 114; or

(iii) a non-resident person who has no tax payable for the year under section 1(1)(a).

(2) Despite subsection (1), the Commissioner-General may serve a notice in writing on a person specified in subsection (1) requiring that person to file a return of income.

(3) Despite subsection (1), a person may elect to file a return of income even though the person is not required to do so.

126. Assessment

A return of income filed under section 124 shall result in a self-assessment.

127. Regulations

(1) The Minister may, by legislative instrument, make Regulations

(a) for matters authorised to be made or prescribed under this Act;

(b) amending a Schedule to this Act or any monetary amount set out in this Act;

(c) for, or in connection with, giving effect to or enabling effect to be given to

(i) any Competent Authority Agreement or other agreement signed between the Government of the Republic of Ghana and the government of another country which makes provision corresponding, or substantially similar, to the common reporting standards; and

(ii) any arrangement for the exchange of tax information in relation to the Republic of Ghana and any other country which makes provision corresponding, or substantially similar, to the common reporting standards; and

(d) for the better carrying into effect of the provisions of this Act.

(2) Without limiting paragraph (c) of subsection (1), the Minister may, in particular,

(a) authorise the Commissioner-General to require persons specified for the purposes of paragraph (c) of subsection (1) to provide the Commissioner-General with information of specified descriptions;

(b) require that information be provided at a time and in a form and manner specified;

(c) impose obligations on relevant entities, including obligations to obtain from specified persons details of their place of residence for tax purposes;

(d) make provision, including provision imposing penalties, for the contravention of, or non-compliance with, the Regulations; and

(e) make provision for appeals in relation to the imposition of a penalty.

(3) In this section, “specified” means specified in Regulations made under this section.

PART IX

INTERPRETATION

128. Persons in a controlled relationship

(1) For the purposes of this Act, two or more persons are in a controlled relationship where the relationship between the persons is

(a) that of an individual and a relative of the individual;

(b) that of partners in the same partnership;

 (c) that of an entity and a person referred to in subsection (2);

 (d) that of a settlor, trustee and beneficiary: or

 (e) in a case not covered by paragraph (a) to (d), such that a person, not being an employee, acts in accordance with the directions, requests, suggestions, or wishes of another person whether or not the persons are in a business relationship and whether or not those directions, requests, suggestions, or wishes are communicated to that other person.

(2) A person and an entity are in a controlled relationship where

(a) the person controls the entity or may benefit from fifty percent or more of the voting power or rights to income or capital of the entity;

(i) either alone or together with persons who, under another application of this section, are associated with the person; and

(ii) whether directly or through one or more interposed entities; or

(b) the person, under another application of this section, is an associate of a person referred to in paragraph (a).

(3) Two persons are not associated persons under subsection 1(a) or (b) where the Commissioner-General is satisfied that, having regard to the prevailing circumstances, it is not reasonable to expect that either person will act in accordance with the intentions of the other.

(4) For purposes of this section, “relative” in relation to an individual, means the individual's child, spouse, parent, grandparent, grandchild, sibling, aunt, uncle, nephew, niece or first cousin, including by way of marriage or adoption.

129. Company

Despite the definition of a company in section 133, each of the following is treated as a company for the purposes of this Act,

(a) a partnership in which at least twenty of the partners have limited liability for the debts of the partnership; and

(b) a trust with at least twenty beneficiaries whose entitlements to participate in the income or capital of the trust are divided into units such that the entitlements are determined by the number of units owned.

130. Domestic and excluded expenditure

(1) Where an individual incurs expenditure in respect of that individual, the expenditure is domestic expenditure to the extent that it is incurred

(a) in maintaining the individual, including the provision of shelter, meals, refreshment, entertainment or other leisure activities;

(b) by the individual in commuting from home;

(c) in acquiring clothing for the individual, other than clothing that is not suitable for wearing outside of work; or

(d) in educating the individual, other than education that is directly relevant to a business conducted by the individual and that does not lead to a degree or diploma.

(2) Where another person incurs expenditure in making a payment to or providing any other benefit for an individual, the expenditure is domestic expenditure except to the extent that

(a) the payment or benefit is included in the calculation of the income of the individual;

(b) the individual provides consideration of an equal market value for the payment or benefit; or

(c) the amount of the expenditure is so small as to make it unreasonable or administratively impracticable to account for.

(3) Expenditures referred to in subsections (1) and (2) include interest incurred on the amount borrowed that is used in a manner referred to in subsections (1) and (2).

(4) For the purposes of this Act, unless the context otherwise requires “excluded expenditure” means

(a) tax payable under this Act;

(b) bribes and expenditure incurred in corrupt practices;

(c) interest, penalties and fines paid or payable to a government or a political subdivision of a government of any country for breach of any legislation;

(d) expenditure to the extent incurred by a person in deriving exempt amounts or final withholding payments;

(e) retirement contributions, unless they are included in calculating the income of an employee under section 4(2)(a)(vi); and

(f) dividends of a company.

131. Financial instruments

(1) In this Act, unless the context otherwise requires, “financial instrument”

(a) means

(i) a debt claim or debt obligation;

(ii) a derivative instrument;

(iii) a foreign currency instrument; and

(iv) any other instrument prescribed by Regulations or, in the absence of Regulations, treated as a financial instrument by generally accepted accounting principles; and

(b) except to the extent specified in Regulations, excludes a membership interest in an entity.

(2) For the purposes of this Act, unless the context otherwise requires

(a) “debt claim” means a right to receive a payment under a debt obligation;

(b) “debt obligation” means an obligation to make a payment to another person that is denominated in money and is in the nature of accounts payable and the obligations arising under deposits, debentures, stacks, shares, treasury bills, promissory notes, bills of exchange and bonds;

(c) “derivative instrument” has the meaning prescribed by Regulations and, in the absence of Regulations, takes its meaning from generally accepted accounting principles; and

(d) "foreign currency instrument" has the meaning prescribed by Regulations and, in the absence of Regulations, takes its meaning from generally accepted accounting principles.

(3) For the purposes of this Act, a person

(a) derives a financial gain when the person derives interest from a financial instrument; and

(b) incurs a financial cost when the person incurs losses with respect to a financial instrument.

(4) For the purposes of this Act, a person

(a) derives a relevant financial gain when the person derives a financial gain from a derivative or foreign currency instrument; and

(b) incurs a relevant financial cost when the person incurs a financial cost with respect to a derivative or foreign currency instrument.

132. Derivative amount

(1) The provisions of this Act shall not be construed as subjecting an amount to a particular treatment just because it is paid, in whole or in part, out of an amount that is subject to a particular treatment.

(2) For purposes of this section, “subjecting an amount to a particular treatment” includes exempting the amount or providing a concession with respect to the amount.

 

133. Interpretation

(1) In this Act, unless the context otherwise requires-

annuity” includes a series of payments of a recurring nature made pursuant to a contractual obligation, other than payments of rent or royalties;

arrangement” means

(a) an action, agreement, course of conduct, dealing, promise, transaction, understanding or undertaking, whether express or implied, whether or not enforce- able by legal proceedings and whether unilateral or involving more than one person; or

(b) a part of an item described in paragraph (a);

asset” includes property of any kind whether tangible or intangible, currency, goodwill, know-how, a night to income or future income, a benefit that lasts longer than twelve months, a part of or any right or interest in, to or over an asset;

associate” means a person who is in a controlled relationship with another person and has the meaning assigned in section 128;

business

(a) includes

(i) a trade, profession, vocation or isolated arrangement with a business character; and

(ii) a past, present or prospective business; but

(b) excludes an employment;

capital asset

(a) includes an asset to the extent to which it is employed in a business or investment; but

(b) excludes trading stock or a depreciable asset;

close company” means a company owned by not more than five persons;

"Commissioner-General” means the Commissioner-General appointed under section 13 of the Ghana Revenue Authority Act, 2009 (Act 791);

company” means a company incorporated under the laws of Ghana or elsewhere and includes

(a) a friendly society, building society or similar society;

(b) a pension fund, provident fund, retirement fund, superannuation fund or similar fund; and

(c) a government, a political subdivision of a government, or a public international organisation but does not include a partnership or a trust;

consideration received" for an asset has the meaning assigned in section 37;

cost” in relation to an asset has the meaning assigned in section 36;

currency point” means one Cedi:

debt claim” has the meaning assigned in section 131;

debt obligation” has the meaning assigned in section 131,

depreciable asset

(a) means an asset to the extent to which itis employed in the production of income from a business and which is likely to lose value because of wear and tear, obsolescence or the effluxion of time; and

(b) does not include goodwill, an interest in land, a membership interest in an entity and trading stock;

derived”, with respect to income or an amount, includes accrued;

dividend” means

(a) a payment derived by a member from a company, whether received as a division of profits, in the course of a liquidation or reconstruction, in a reduction of capital or redeemable preference shares or otherwise;

(b) an amount treated as dividends in a situation where the Commissioner-General makes a deemed distribution of dividends in the case of a close company;

and includes a capitalisation of profits

(c) whether by way of a bonus share issue, increase in the amount paid-up on shares or otherwise; and

(d) whether an amount is distributed or not;

but does not include a payment to the extent to which it is

(e) matched by a payment made by the member to the company;

(f) debited to a capital, share premium or similar account, or

(g) otherwise constitutes a final withholding payment or is included in computing the income of the member;

domestic expenditure” has the meaning assigned in section 130;

employee” means an individual engaged in employment;

employer” means the person who engages or remunerates an employee in employment;

employment” means

(a) a position of an individual in the employ of another person;

(b) a position of an individual as manager of an entity other than as partner of a partnership;

(c) a position of an individual entitling the individual to a fixed or ascertainable remuneration in respect of services performed; and

(d) a public office held by an individual;

entity” means a company, partnership or trust, but does not include an individual;

excluded expenditure” has the meaning assigned in section 130;

exempt amount” means an amount exempt by reason of section 7, 57, 59 or 111 or the Sixth Schedule;

expense” means a payment made that reduces the assets of the person making the payment;

final withholding payment" has the meaning assigned in section 119;

financial institution” means

(a) a bank regulated under the Banking Act, 2004 (Act 673); [Act 673 has since been repealed by the Banks And Specialised Deposit-Taking Institutions Act, 2016 (Act 930)]

(b) a non-banking financial institution regulated under the Non-Banking Financial Institutions Act, 2008 (Act 774); or

(c) any other category of person prescribed by Regulations;

financial cost” has the meaning assigned in section 131;

financial gain” has the meaning assigned in section 131;

financial instrument” has the meaning assigned in section 131,

gain” in relation to the realisation of an asset or liability has the meaning assigned in section 35;

generally accepted accounting principles” means the generally accepted accounting principles that the Institute of Chartered Accountants (Ghana) may adopt;

interest” includes

(a) a payment, in the nature of a discount or premium, made under a debt obligation that is not a return of capital;

(b) a swap or other payment functionally equivalent to interest;

(c)  a commitment, guarantee or service fee paid in respect of a debt obligation or swap agreement; and

(d) a distribution by a building society;

investment” includes

(a) the owning of one or more assets of a similar nature or that are used in an integrated fashion; or

(b) a present, past or prospective investment; but does not include business or employment;

Investment asset

(a) includes a capital asset held as part of an investment being shares or securities in a company, a beneficial interest in a trust or an interest in land or buildings, but

(b) excludes the primary private residence of an individual, provided the residence has been owned by the individual continuously for the three years before disposal and lived in on a daily basis for at least two of those three years;

lease” means an arrangement providing a person with a temporary right in respect of an asset of another person, other than money, and is in the nature of a licence, profit-a-prendre, option, rental agreement, royalty agreement or tenancy;

manager”, in relation to an entity

(a) means a councillor, director, manager, member, officer or other person who participates or may participate, whether alone or jointly with other per-sons, in making senior management decisions on behalf of the entity; and

(b) includes

(i) a partner of a partnership and a trustee of a trust;

(ii) a person treated as a manager of an entity by another tax law;

(iii) a person in accordance with whose directions and instructions the entity or a person described in the rest of this definition is required or accustomed to act; and

(iv) a non-resident person with respect to a Ghanaian permanent establishment owned by the person under section 106;

market value” of a payment, asset or liability is determined in accordance with section 26;

member” in relation to an entity means a person who owns a membership interest in the entity;

membership interest” in an entity means a right, whether of a legal or equitable nature, and is in the nature of a contingent tight to participate in Income or capital of the entity, the interest of a partner in a partnership, the interest of a beneficiary in a trust and shares in a company;

Minister” means the Minister responsible for Finance;

natural resource” means minerals, petroleum, water or any other non-living or living resource that may be taken from land or the sea;

natural resource payment” means a payment in the nature of a premium or like amount, for the right to take natural resources from land or the sea or calculated in whole or part by reference to the quantity or value of natural resources taken from the land or the sea:

net cost" for an asset or liability at a particular time is

(a) in the case of a depreciable asset, the share of the written down value of the pool to which it belongs at that time apportioned according to the market value of all the assets in the pool; and

(b) in the case of any other asset or a liability, the amount by which cumulative costs for the asset or liability exceed cumulative consideration received for the asset or liability to the time;

partnership” means an association of two or more individuals or corporations carrying on business jointly for the purpose of making profit, irrespective of whether the association is recorded in writing;

payment” includes an amount paid or payable in cash or kind, and the conferring of value or a benefit in any form by one person on another person and is in the nature of

(a) the transfer by one person of an asset or money to another person or the transfer by another person of a liability to the one person;

(b) the creation by one person of an asset that on creation is owned by another person or the decrease by one person of a liability owed by another person;

(c) the supply of services by one person to another; and

(d) the making available of an asset or money owned by one person for use by another person or the granting of use of an asset or money to another person;

permanent establishment" means a Ghanaian permanent establishment or foreign permanent establishment within the meanings assigned in section 107;

person” means an individual or entity;

redundancy pay” has the meaning assigned in section 65 of the Labour Act, 2003 (Act 651);

relative” has the meaning assigned in section 128;

relevant financial cost” has the meaning assigned in section 131;

relevant financial gain" has the meaning assigned in section 131;

rent” includes

(a) a payment, including a payment of a premium or like amount, for the use of or right to use property including equipment of any kind; and

(b) a payment for the rendering of, or the undertaking to render, assistance ancillary to a use or a right referred to in paragraph (a);

but excludes a natural resource payment or a royalty;

residence” or “resident” with respect to a person is determined in accordance with section 101;

retirement contribution” has the meaning assigned in section 96;

retirement fund” has the meaning assigned in section 96;

retirement payment” has the meaning assigned in section 96;

royalty” includes a payment of a premium or like amount, derived as consideration for

(a) the use of or right to use a copyright of literary, artistic or scientific work, including cinematograph films, software or video or audio recordings, whether the work is in electronic format or otherwise;

(b) the use of or right to use a patent, trade mark, design or model, plan, or secret formula or process;

(c) the use of or right to use any industrial, commercial, or scientific equipment;

(d) the use of or right to use information concerning industrial, commercial, or scientific experience;

(e) the rendering of or the undertaking to render assistance ancillary to a matter referred to in paragraph (a), (b), (c) or (d); or

(f) total or partial forbearance with respect to a matter referred to in paragraph (a), (b), (c), (d) or (e);

service fee” means a payment to the extent to which, based on market values, it is reasonably attributable to services rendered by a business of a person, but excludes interest, rent or a royalty;

shareholder” means a person who is a member of a company;

small scale mining” has the meaning assigned in the Minerals and Mining Act, 2006 (Act 703);

state owned or state sponsored educational institution” means an educational institution

(a) established by the Government of (Ghana or any political division of the Government, whether district, municipal or metropolitan authority, and usually regulated in matters of detail by the government or that division and maintained at public expense by taxation and open, usually without charge or with minimal charge, to the children of all the residents of that division or other divisions; or

(b) belonging to the public and established, conducted or managed under public authority by the central government or a political division of the central government;

trading stock” means assets owned by a person that are sold or intended to be sold in the ordinary course of a business of the person, work in progress on the assets, inventories of materials to be incorporated into the assets and consumable stores;

trust” means an arrangement under which a trustee holds assets;

trustee” means an individual or body corporate holding assets in a fiduciary capacity for the benefit of identifiable persons or for some object permitted by law and whether or not

(a)  the assets are held alone or jointly with other individuals or bodies corporate; or

(b) the individual or body corporate is appointed or constituted trustee by personal acts, by will, by order or declaration of a court or by other operation of the law; and

(c) includes

(i) an executor, administrator, tutor or curator;

(ii) a liquidator, receiver, trustee in bankruptcy or judicial manager;

(iii) a person having the administration or control of assets subject to a usufruct, fideicommissum or other Limited interest;

(iv) a person who manages the assets of an incapacitated individual; and

(v) a person who manages assets under a private foundation or other similar arrangement;

underlying ownership

(a) in relation to an entity, means membership interests owned in the entity, directly or indirectly through one or more interposed entities, by individuals or by entities in which no person has a membership interest; or

        (b)      in relation to an asset owned by an entity, is deter- mined as though the asset is owned by the persons having underlying ownership of the entity in proportion to that ownership of the entity;

withholdee" means a person receiving are entitled to receive a payment from which tax is required to be withheld under Division II of Part VIII;

withholding agent” means a person required to withhold tax from a payment under Division II of Part VIII; and

“year of assessment” has the meaning assigned in section 18.

PART X

TEMPORARY AND TRANSITIONAL PROVISIONS

Division I: Temporary provisions

134. Temporary concession

(1) The provisions of the Sixth Schedule provide for concessions of a temporary nature.

(2)  Unless expressly stated to the contrary, the provisions of the Sixth Schedule apply strictly and only in accordance with their clear wording.

(3)  A person is not entitled to a concession in the Sixth Schedule if an associated person has benefited or is benefiting from that concession.

(4)  This section does not apply as between two associated individuals who are residents.

(5)  For the purposes of this Act, where a provision of the Sixth schedule applies to grant a concession to a person with respect to a particular type of business

(a) the business is construed narrowly and only the person's activities devoted wholly, exclusively and necessarily to that business are treated as part of the business;

(b) the income gained by a person or loss incurred by a person from the business for a year of assessment is calculated separately from any other activity of the person; and

(c) an unexpired period granted under the concession shall be treated as having been transferred to a new owner of the business in case of transfer of ownership of the business and that concession shall not commence with the new ownership,

(6) Unless expressly stated to the contrary the income of a person entitled to a concession in the Sixth Schedule is subject to tax at the rate provided for in the First Schedule

135. Agreements affecting tax

(1) Subsections (2) and (3) apply where the Government of Ghana has concluded, whether before or after the commencement of this Act, a binding agreement with a person that purports to modify the manner in which tax is imposed, including by reason of a fiscal stability clause.

(2)  Where this subsection applies, the provisions of the old tax law that are modified or protected by the agreement continue to apply until the earlier of

(a) the end of the agreement or relevant clauses in the agreement;

(b) the first alteration of the agreement after the commencement of this Act; and

(c) the relinquishment by the person of the person's right to modified tax treatment.

(3)Where this subsection applies, the Commissioner-General may, in calculating the tax liability of the person during the application period referred to in subsection (2),

(a) continue to apply other provisions of the old tax law,

(i) that the Commissioner-General considers are associated with or that have an application that is consequential upon the provisions mentioned in subsection (2); and

(ii) instead of applying the corresponding provisions under the new tax law; and

(b) not apply any provisions in the new tax law that have no corresponding provision in the old tax law.

(5) For purposes of this section,

fiscal stability clause” refers to a clause man agreement that provides that certain provisions of a tax law at the time of the agreement will continue to apply or not be altered to the detriment of a contracting party;

new tax law” means a tax law after it has been modified or excluded by an agreement referred to in subsection (1), but without considering any such modification or exclusion; and

old tax law" means a tax law as applicable immediately before it is modified or protected by an agreement referred to in subsection (1).

Division II: Repeats, savings, transitional provisions and commencement
136. Repeals and savings

(1) The following enactments are repealed:

(a) subject to section 138, the Internal Revenue Act, 2000 (Act 592); and

(b) any other laws to the extent that they are inconsistent with the provisions of this Act.

(2) Despite the repeal of the enactments in subsection (1), the Regulations, notices, orders, directions, appointments or any other act lawfully made or done under the repealed enactments and in force immediately before the commencement of this Act shall, be considered to have been made or done under this Act with necessary modifications and shall continue to have effect until reviewed, cancelled or terminated

(3) Any right or privilege acquired by a person under the repealed legislation ceases to exist on the date this Act comes into effect under section 139, unless it is expressly provided in this Part or in the Regulations that the right or privilege is to remain in existence.

137. Consequential amendments

The Banking Act, 2004 (Act 673) is amended in section 84(3) by the substitution for paragraph (i) of “(i) the bank is required to do either or both of the following:

(i) provide information on the bank records of a client of that bank to the Ghana Revenue Authority

                 (A) upon the request of the Ghana Revenue Authority acting in accordance with paragraphs 19 and 20 of the Seventh Schedule of the Income Tax Act, 2015 (Act 891); or

                 (B) in accordance with Regulations made under the Income Tax Act, 2015 (Act 891} for the automatic exchange of financial information for tax purposes with the competent authority of another jurisdiction;

(ii) make a report or provide additional information on a suspicious transaction to the Financial Intelligence Centre set up under the Anti-Money Laundering Law in force”. [Act 673 has since been repealed by the Banks And Specialised Deposit-Taking Institutions Act, 2016 (Act 930)]

138. Transitional provisions

(1) The repealed legislation continues to apply for years of assessment commencing prior to the date on which this Act comes into effect

(2) A reference in this Act to

(a) a previous year of assessment includes, where the context requires, a reference to a year of assessment under the repealed legislation; or

(b) this Act or to a provision of this Act includes, where the context requires, a reference to the repealed legislation or to a corresponding provision of the repealed legislation, respectively.

(3) The Minister may, by legislative instrument, make Regulations to prescribe transitional measures for the implementation of this Act.

139. Provisions for tax administration

Until the date the Revenue Administration law administered by the Ghana Revenue Authority comes into force, the Seventh Schedule shall, in addition to the Ghana Revenue Authority Act 2009 (Act 791) be used to administer this Act.

FIRST SCHEDULE

Tax Rates

(Sections 1, 63, 71, 77, 85, 115 and 116)

  1. Rates of income tax for individuals

Subject to subparagraph (3) and the Second Schedule, the chargeable income of a resident individual for a year of assessment is taxed at the following rates:

NO. CHARGEABLE INCOME RATE OF TAX
1.

2.

3.

4.

5.

First GH¢ 1,584

Next GH¢ 792

Next GH¢ 1,104

Next GH¢ 28,200

Exceeding GH¢ 31,680

NIL

5 percent

10 percent

17.5 percent

25 percent

 

(2) Subject to subparagraph (3), the chargeable income of a non-resident individual for a year of assessment is taxed at the rate of twenty percent.

(3) Where the chargeable income of an individual includes a gain from the realisation of an investment asset not charged elsewhere, the individual may elect that

(a) the gain from the realisation of the investment asset, less any loss from the realisation of that asset is taxed at the rate of fifteen percent; and

(b) the remainder of the chargeable income of the individual be taxed at the rates referred to in subparagraph (1) or (2) as the case requires.

  1. Rate of income tax for trusts

The chargeable income of a trust for a year of assessment is taxed at the rate of twenty-five percent.

  1. Rates of income tax for companies

(1) The chargeable income of a company other than a company principally engaged in the hotel industry and income from goods and services provided to the domestic market by a Free Zone Enterprise after its concessionary period for a year of assessment is taxed at the rate of twenty-five percent.

(2) The chargeable income of a company principally engaged in the hotel industry for a year of assessment is taxed at the rate of twenty- two percent.

(3) The chargeable income of a company from the export of non- traditional goods for a year of assessment is taxed at the rate of eight percent.

(4) The chargeable income derived by a financial institution from a loan granted to a farming enterprise for use by that enterprise in the production of income is taxed at the rate of twenty percent.

(5) The chargeable income derived by a financial institution from a loan granted to a leasing company for the use by that company for the funding or acquisition of assets for lease is taxed at the rate of twenty percent.

(6) The chargeable income of a company from a manufacturing business mot included in subparagraphs (1) and (3) for a year of assessment is taxed at the rates indicated below:

Location Rate of income tax
(a)  Manufacturing business

(b) Manufacturing business located elsewhere in the country

73 percent of the rate of income located in the regional tax applicable to other income capitals of the country under subparagraph (1)

50 percent of the rate of income tax applicable to other income under subparagraph (1)

(7) In this paragraph, “non-traditional goods” include

(a) horticultural products;

(b) processed and raw agricultural products grown in Ghana, other than cocoa beans;

(c) wood products, other than lumber and logs;

(d) handicrafts; and

(e) locally manufactured goods.

  1. Rates of income tax for Free Zone Enterprises

The chargeable income of a Free Zone Enterprise after the concessionary period from the export of goods and services outside of the national customs territory for a year of assessment is taxed at the rate of fifteen percent.

  1. Rate of Petroleum Income Tax

The chargeable income of a person from petroleum operations for a year of assessment is taxed at the rate of thirty-five percent.

  1. Rate of Mineral Income Tax

The chargeable income of a person from mineral operations for a year of assessment is taxed at the rate of thirty-five percent.

  1. Rate of tax on persons entitled to concessions under the Sixth Schedule

The income of a person entitled to a concession in the Sixth Schedule is subject to tax at the rate of one percent of chargeable income.

  1. Rates of withholding tax

(1) The rates of tax to be withheld from payments under Division II of Part VIII are:

(a) a payment to which section 114 applies

(i) in the case of a resident withholdee, at the rates specified in paragraph 1(1) of this Schedule or as amended by Regulations; and

(ii) in the case of a non-resident withholdee, twenty percent;

(b) a payment to which section 115 applies

(i) in the case of dividends, eight percent;

(ii) in the case of interest paid to individuals, one percent;

(iii) in the case of any other interest, eight percent;

(iv) in the case of rent paid to an individual for residential property, eight percent;

(v) in the case of rent paid to an individual for non-residential property, fifteen percent;

(vi) in the case of rent paid to a person other than an individual for residential property, eight percent;

(vii) in the case of rent paid to a person other than an individual for non-residential property, fifteen percent;

(viii) in the case of lottery winnings, five percent of the amount; and

(ix) in the case of natural resource payments and royalties, fifteen percent; and

(c)  a payment to which section 116 applies

(i) in the case of service fees referred to in section 116(1)(a)(i), twenty percent;

(ii) in the case of service fees referred to in section 116(1)(a)(i) — (vi), ten percent;

(iii) in the case of service fees referred to in section 116(1)(b), twenty percent;

(iv) in the case of insurance premiums referred to in section 116(1)(b), five percent;

(v) in the case of goods referred to in section 1 16(2)(a), three percent;

(vi) in the case of works and service fees referred to in section 116 (2)(a) five percent;

(vii) in the case of service fees referred to in section 116 (2)(c) fifteen percent;

(viii) in the case of management and technical service fees referred to in section 116(9), twenty percent; and

(ix) in the case of goods and works referred to in section 116(10), twenty percent.

(2) The rate of tax to be withheld from a payment to which section 71(4) applies is fifteen percent of the amount.

(3) The rate of tax to be withheld from a payment under section 85(2) is ten percent of the amount.

(4) The rate of tax to be withheld from a payment under section 105(g) and (h) is fifteen percent of the amount.

  1. Change of rate

Where a rate referred to in paragraph 1 to 7 changes during a year of assessment

(a) a tentative tax shall be computed by applying the rate in force before and after the effective date of the change to the chargeable income of the person for the entire year; and

(b) the income tax payable by the person for the year is the sum of the portion of the tentative tax that the number of months in each part of the year during which the attributable rate is in force bears to the number of months in the year of assessment.

SECOND SCHEDULE

Modified Taxation

(Section (5))

  1. Principles of modified taxation

This Schedule modifies the taxation of eligible resident individuals by

(a) imposing a presumptive tax on individuals that only have income from the businesses specified in paragraphs 3 and 4; and

(b) applying a modified cash basis in calculating income from the businesses specified in paragraph 5.

  1. Presumptive taxation

(1) Presumptive taxation applies where

(a) the chargeable income of a resident individual for a year of assessment consists exclusively of income from a business;

 (b) the income is exclusively from sources within Ghana; and

 (c) the individual

 (i) is not registered for value added tax purposes and has an annual turnover of not more than twenty thousand Cedis from the business, computed as an average of the turnover for three consecutive years ending in the year of assessment; or

(ii) has an annual turnover of more than twenty thousand Cedis from the business and is not required to register tor value added tax purposes.

(2) For purposes of subparagraph 1(c), where the average turnover of an individual is not available for the period specified, the Commissioner-General may determine how the turnover is to be calculated.

  1. Exclusions from presumptive tax

(1) The following individuals are excluded from presumptive taxation under paragraphs 4 and 5, even if they meet the requirements of paragraph 2:

(a) an individual who has a professional qualification;

(b) an individual who is engaged in a business prescribed by regulations that has a high profit to turnover ratio;

(c) an individual who has more than one business

(d) an individual who has a business with more than one business outlet

(e) an individual in a partnership; and

(f) an individual who elects to disapply paragraphs 4 and 5 for a year of assessment.

(2)  Where an individual elects to disapply paragraphs 4 and 5, paragraphs 4 and 5 shall not apply to that individual for that year of assessment and the following five years of assessment, but that individual may qualify for modified cash basis taxation under paragraph 6.

  1. Presumptive tax based on instalments

Where presumptive taxation applies to an individual as referred to in paragraph 2(1)(c)(i), the tax payable by that individual for a year of assessment under section 1(1)(a) is the total of instalments payable by that individual for a year of assessment under section 121.

  1. Presumptive tax based on turnover

Where presumptive taxation applies to an individual as referred to in paragraph 2(1)(c)(i), the tax payable by that individual for a year of assessment under section 1(1)(a) is three percent of the turnover of the business, where the turnover is more than twenty thousand cedis but does not exceed one hundred and twenty thousand cedis.

  1. Modified cash basis

(1) The modified cash basis under subparagraph (2) applies where

(a) the assessable income of a resident individual for a year of assessment from all businesses conducted by that individual consists exclusively of income from sources in the country; and

(b) the turnover of that individual does not exceed one hundred and twenty thousand cedis,  calculated using the modified cash basis.

(2)  Where the modified cash basis applies as referred to in subparagraph (1) the income of an individual from a business for a year of assessment shall be calculated

(a) according to the standard rules for calculating income from a business; and

(b) using the modified cash basis of accounting.

(3) For the purpose of subparagraph (2)(b), sections 17, 21(4), 25, 26 and 31 do not apply to the calculation of the income of an individual from a business for a year of assessment.

(4) In this Schedule, “turnover of a business for a year" means the amount derived from the business during the year that is required to be included in calculating income from the business under section 5(2)(a), (i)(ii) and (iv) only.

THIRD SCHEDULE

Capital Allowances

(Sections 5, 14, 67 and 81)

PART I: GENERAL

  1. Classification and pooling of depreciable assets

(1) Depreciable assets are classified as follows:

CLASS DEPRECIABLE ASSETS

 

1. Computers and data handling equipment together with peripheral devices.

 

 

2.

(I) Automobiles, buses and minibuses, goods vehicles; construction and Earth-Moving equipment, heavy general purpose or specialised trucks, trailers and trailer-mounted containers; plant and machinery used in manufacturing.

(ii) Assets resulting from expenses referred to in subparagraph (4) in respect of long term crop planting costs

 

3.

 

 

 

4.

Railroad cars, locomotives and equipment; vessels, barges, tags and similar water transportation equipment; aircraft; specialised public UTIlity plant, equipment and machinery; office furniture, fixtures and equipment; any depreciable asset not included in another class.

 

Buildings, structures and similar works of a permanent nature.

5. Intangible assets

 

(2) A Class 1, 2 or 3 depreciable asset owned and employed by a person during a year of assessment in the production of income from a particular business shall, at the time the asset is first owned and employed by that person, be placed in a pool with all other assets of the same Class owned and employed by that person in the business.

(3) A Class 4 or 5 depreciable asset owned and employed by a person during a year of assessment in the production of income from a particular business shall, at the time the asset is first owned and employed by the person, be placed in a pool of its own separately from other assets of that Class or any other Class.

(4) Where a depreciable asset owned by a person is partly used in the production of income from a business, only that part of the asset which is used in the production of the income shall be placed in the pool of depreciable assets.

(5) Subparagraph (6) applies to expenses incurred by a person wholly, exclusively and necessarily in the production of the income of that person from a business

(a) in respect of planting vegetation from which timber, rubber, oil palm or other crops are derived; and

(b) where the business is a timber concern or a large scale rubber, oil palm or other long term crop plantation.

(6) Unless otherwise provided, an expense referred to in subparagraph (5) shall be treated as if the expense was incurred in securing the acquisition of a depreciable asset that is used by the person in the production of income.

  1. Depreciation Allowance

(1) Subject to this paragraph and with respect to each basis period of a person ending in the year of assessment, the Commissioner-General shall grant an allowance to that person fora year of assessment for each pool of depreciable assets.

(2) The allowance referred to under subparagraph (1) shall be equal to the depreciation for the period of each pool of depreciable assets and computed in accordance with subparagraphs (3) and (6).

(3) Depreciation for a year of assessment for each pool of depreciable assets is computed

(a) in the case of Class 1, 2 and 3 pools, in accordance with the reducing balance method; and

(b) in the ease of Class 4 and 5 pools, in accordance with the straight line method.

(4) Depreciation is calculated using the following formula:

A X B X C

365

Where

A is the depreciation basis of the pool of depreciable assets at the end of the basis period;

B is the depreciation rate applicable to the pool of depreciable assets; and

C is the number of days in the basis period of the person.

(5) The depreciation rates applicable to each pool of depreciable assets referred to in subparagraph (3) are

NO. CLASS RATE
1. 1 40 percent
2. 2 30 percent
3. 3 20 percent
4. 4 10 percent
5. 5 1 divided by the useful life of the asset in the pool

(6) Where at the end of a year of assessment, the depreciation basis of a pool of depreciable assets, reduced by depreciation calculated under subparagraph (3), produces an amount that is less than five hundred Cedis, additional depreciation of that pool is computed as equal to that amount.

(7) The allowance granted to a person under subparagraph (1) for a year of assessment with respect to a Class 4 or 5 pool of depreciable assets shall not exceed the depreciation basis of the pool at the end of the basis period, reduced by all other allowances granted to the person in any previous basis period in respect of that pool.

  1. Depreciation basis of a pool of depreciable assets

(1) The depreciation basis of a pool of depreciable assets at the end of a basis period in respect of a Class 1, 2 or 3 asset is

(a) the total of

(i) the depreciation basis of the pool at the end of the previous basis period, if any, after deducting depreciation for that pool calculated under paragraph 2 for that previous period; and

(ii) amounts added to the depreciation basis of that pool during the basis period in respect of additions to the cost of assets in or added to that pool; and

(b) reduced, but not below zero, by consideration received for the assets in that pool or that have been in the pool during the basis period.

(2) The depreciation basis of a pool of depreciable assets at the end of a basis period in respect of a Class 4 or 5 asset is

(a) the total of

(i) the depreciation basis of that pool at the end of the previous basis period; and

(ii) amounts added to the depreciation basis of that pool during the basis period in respect of additions to the cost of assets in or added to the pool; and

(b) reduced, but not below zero, by the consideration received for the assets m that pool during the basis period.

(3) Where by reason of subparagraph (3) of paragraph 1, only part of an asset is placed in a pool of depreciable assets, the Commissioner-General shall apportion the cost of that asset and the consideration received for that asset according to the market value of the part of the asset which has been included in the pool and the part which is not placed in the pool,

(4) For the purpose of this Schedule, the cost of a road vehicle other than a commercial vehicle, is not recognised to the extent that the cost exceeds seventy-five thousand Cedis.

(5) For the purpose of this paragraph, “commercial vehicle" means

(a) A road vehicle designed to carry a load of more than half a tonne or more than thirteen passengers; or

(b) a vehicle used in a transportation or a vehicle rental business.

  1. Realisation of depreciable assets

(1) For the purpose of computing the income of a person for a year of assessment from a business in which a depreciable asset of a particular Class was employed, the Commissioner-General shall include the excess of the following two amounts:

(a) the consideration received by the person during the year for any asset that was in a particular pool of depreciable assets of the person during the year; reduced by

(b) subparagraph (i) or (ii), as appropriate

(i) in the case of a Class 1, 2 or 3 pool of depreciable assets, the depreciation basis of each pool at the end of the year, but disregarding the consideration received referred to in paragraph (a), or

(ii) in the case of a Class 4 or 5 pool, the written down value of the pool at the end of the year calculated under subparagraph (3), but disregarding the consideration received referred to in paragraph (a).

(2) Where the assets in a pool of depreciable assets of a person are all realised by the person before the end of a year of assessment, the person shall dissolve the pool of depreciable assets and

(a) include in the income of that person for the year, an amount that is calculated using the formula A — B; or

(b) granted an allowance for the year, calculated using the formula B— A;

where

A — is the consideration received by the person during the year of assessment for the asset; and

B — is the sum of

(i) the written down value of that pool of depreciable assets at the end of the previous year of assessment, and

(ii) amounts added to the depreciation basis of that pool of depreciable assets during the year of assessment.

(3) For the purpose of this paragraph, “written down value” of a pool of depreciable assets at the end of a year of assessment means

(a) In the case of a Class 1, 2 or 3 pool of depreciable assets, the depreciation basis of that pool at the end of the year, if any, after deducting depreciation for that pool for the year as calculated under paragraph 2; or

(b) in the case of a Class 4 or 5 pool of depreciable assets, the depreciation basis of that pool at the end of the year reduced by all allowances granted to the person under paragraph 2 in respect of that pool for that year and any previous year.

(4) For the purpose of this paragraph, a person realises a depreciable asset referred to in paragraph 1(5) only if that person sells to another person who is not an associate the business in respect of which the expense was incurred.

Part II: Petroleum Operations

  1. Modification of Part I

(1) A person who incurs a capital allowance expenditure in respect of a separate petroleum operation during a year of assessment shall place that expenditure in a separate pool of depreciable assets.

(2) The Commissioner-General shall grant to that person a capital allowance with respect to each year at the rate of twenty percent using the straight line method.

(3) Where an asset for which capital allowance expenditure has been incurred under this paragraph is disposed of or treated as disposed of during a year of assessment, the Commissioner-General shall, in computing assessable income from the separate petroleum operation for the year.

(4) Where in a year of assessment an asset is partly used in a separate petroleum operation and partly used in another separate petroleum operation the Commissioner-General shall apportion the capital allowance of that asset in that year between the two separate petroleum operations in proportion to the use of the asset in each separate petroleum operation.

(5) Where in a year of assessment a person assigns a petroleum right of that person, the written down value of any capital allowance expenditure of that person at the beginning of that year is transferred to the assignee.

(6) Where in a year of assessment a person assigns part of the petroleum right of that person, the Commissioner-General shall apportion the written down value of the capital allowance expenditure of the person between that person and the assignee in proportion to the percentage of the interest retained and the percentage of the interest assigned.

(7) Where, for the purpose of calculating the income of a person, a deduction is made in respect of capital allowance expenditure, a further deduction shall not be made in respect of the same capital allowance expenditure under any other provision of this Act.

(8) In this paragraph, unless the context otherwise requires,

“capital allowance expenditure” means expenditure for which capital allowances are available under this Schedule, including by reason of Division I of Part VI but subject to section 67; and

“written down value” of an asset means the cost of the asset less all capital allowances granted with respect to expenditure included in that cost.

Part III: Minerals and Mining

  1. Modification of Part I

(1) A person who incurs a capital allowance expenditure in respect of a separate mineral operation during a year of assessment shall place that expenditure in a separate pool of depreciable assets.

(2) The Commissioner-General shall grant to that person a capital allowance with respect to each year at the rate of twenty percent using the straight line method.

(3) Where an asset for which capital allowance has been granted under this paragraph is disposed of or treated as disposed of during a year of assessment, the Commissioner-General shall,

(a) if the consideration received for the disposal exceeds the written down value of the asset, include the excess in computing the assessable income of that person from the separate mineral operation for the year;

(b) if the written down value of the asset exceeds the consideration received for the disposal, grant an additional capital allowance for the year in an amount equal to the excess; and

(c) reduce the pool of depreciable assets referred to in subparagraph (1) by the written down value of the asset.

(4) Where in a year of assessment an asset is partly used in a separate mineral operation and partly used in another separate mineral operation, the Commissioner-General shall apportion the capital allowance of that asset in that year between the two separate mineral operations in proportion to the use of the asset in each separate mineral operation.

(5) Where in a year of assessment a person assigns a mineral right of that person, the written down value of any capital allowance expenditure of that person at the beginning of that year is transferred to the assignee,

(6) Where in a year of assessment a person assigns part of the mineral right of that person, the Commissioner-General shall apportion the written down value of the capital allowance expenditure of the person between that person and the assignee in proportion to the percentage of the interest retained and the percentage of the interest assigned.

(7) Where, for the purpose of calculating the income of a person, a deduction is made in respect of capital allowance expenditure, a further deduction shall not be made in respect of the same capital allowance expenditure under any other provision of this Act.

(8) In this paragraph

“capital allowance expenditure" means expenditure for which capital allowances are available under this Schedule, including by reason of Division II of Part VI but subject to section 75; and

“written down value” of an asset means the cost of the asset less any capital allowances granted with respect to expenditure included in that cost.

FOURTH SCHEDULE

Quantification of benefits

(Section 26)

  1. Motor vehicle benefits

A benefit consisting of the availability for use or use of a motor vehicle provided by an employer ta an employee or an entity to a member or manager during a year of assessment is quantified according to the following rates:

NO BENEFIT RATE
1. Driver and vehicle with fuel 12.5 percent of the total cash emoluments of the person up to a maximum of GH¢ 600.00 per month
2. Vehicle with fuel 10 percent of the total cash emoluments of the person up to a maximum of GH¢500.00 per month
3. Vehicle only 5 percent of the total cash emoluments of the person up to a maxi mum of GH¢250.00 per month
4. Fuel only 5 percent of the total cash emoluments of the person up to a maxi mum of GH¢250.00 per month

 

  1. Accommodation benefits

A benefit consisting of the provision of premises by an employer for residential occupation of an employee during a year of assessment is quantified as follows:

NO BENEFIT RATE
1. Accommodation with furnishing 10 percent of the total cash emoluments of the person
2. Accommodation only 7.5 percent of the total cash emoluments of the person
3. Furnishing only 2.5 percent of the total cash emoluments of the person
4. Shared accommodation 2.5 percent of the total cash emoluments of the person

 

  1. Loan benefits

A benefit consisting of a loan provided for a year of assessment in return for services, whether by way of employment or otherwise, or by an entity to a member or manager of the entity is quantified as

(a) Where

(i) the loan is from an employer to an employee,

(ii) the term of the loan does not exceed twelve months, and

(iii) the aggregate amount of the loan and any similar loan outstanding at any time during the previous twelve months does not exceed three months basic salary, the quantity of the payment is nil; and

(b) in any other case, a quarter of the amount by which

(i) if interest were payable under the loan at the statutory rate for the year of assessment, the interest that would have been paid by the payee during the year of assessment in which the payment is made, exceeds

(ii) the interest paid by the payee during the year of assessment under the loan, if any.

(1) In this paragraph, “statutory rate", means the Bank of Ghana rediscount rate.

FIFTH SCHEDULE

Personal reliefs

(Section 51)

  1. The personal reliefs referred to in section 51 are as follows:

(a) in the case of an individual who has a dependant spouse or at least two dependant children, that individual is entitled to a personal relief of two hundred currency points;

(b) in the case of an individual who has a disability, that individual is entitled to a personal relief of twenty-five percent of the assessable income of that individual from a business or employment;

(c) in the case of an individual who is sixty years of age and above, that individual is entitled to a personal relief of two hundred currency points;

(d) in the case of an individual who is sponsoring the education of the child or ward of that individual in a recognised registered educational institution in the country, that individual is entitled to a personal relief of two hundred currency points per child or ward up to a maximum of three children or wards;

(e) in the case of an individual who has a dependant relative, other than a child or spouse, who is sixty years of age or more, that individual is entitled to a personal relief of one hundred currency points but that individual may only claim relief in respect of two dependant relatives; and

(f) in the case of an individual who has undergone training to update the professional, technical or vocational skills or knowledge of the individual, that individual is entitled to a personal relief which is equivalent to the cost of the training of not more than four hundred currency points.

  1. Where two or more persons qualify in respect of the same child, ward or relative under paragraph 1(d) or(e), the Commissioner-General shall grant only one relief.
  1. For the purpose of this Schedule, “dependant child, spouse or relative" in respect of an individual, means a child, spouse or relative of the individual for whom that individual provides the necessities of life.
SIXTH SCHEDULE

Temporary concessions

(Section 134)

  1. Agriculture

(1) Where an individual conducts a farming business wholly within the country, that individual is subject to tax at the rate provided for in the First Schedule

(a) In the case of farming tree crops, income of that individual from the business for a period of ten years of assessment commencing from the year during which the first harvest of crops occurs;

(b) In the case of cash crops or farming livestock, other than cattle or fish, income of that individual from the business for a period of five years of assessment commencing from the year during which the business commences; and

(c) in the case of cattle, income from the business for the period of ten years of assessment commencing from the year during which the business commences.

(2) The income of a person from an agro processing business conducted wholly in the country is subject to tax at the rate provided for in the First Schedule for a period of five years of assessment commencing from the year in which commercial production commences.

(3) The income of a person from a cocoa by-product business conducted wholly in the country is subject to tax at the rate provided for in the First Schedule for a period of five years of assessment commencing from the year in which commercial production commences.

(4) In this paragraph, unless context otherwise requires,

cash crops" include cassava, maize, pineapple, rice, and yam;

cocoa by-product business” means a business that uses on a commercial basis cocoa by-products using as its main raw material substandard cocoa beans, cocoa husks and other cocoa waste;

farming business” means the business of producing crops, fish or livestock;

agro processing business” means the business of processing crops, fish or livestock produced, caught or raised in the country from their raw state into an edible canned or pack- aged product; and

tree crops” include coconut, coffee, oil palm, rubber, and shea nut.

  1. Rural banking

(1) The income of a person from a rural banking business is subject to tax at the rate provided for in the First Schedule for a period of ten years of assessment commencing from the year in which the business is established.

(2) In this paragraph, “rural banking business” means a business designated as a rural banking business under the Banking Act, 2004 (Act 673).

  1. Waste processing

(1) The income of a company from a waste processing business is subject to tax at the rate provided for in the First Schedule for a period of seven years of assessment,

(2) The period specified in subparagraph (1) commences from the year nm which the business is commenced.

(3) In this paragraph, “waste processing business” means a business where the principal activity is the processing of waste, including recycling of plastic and polythene material for agricultural or commercial purposes.

  1. Residential premises

(1) The income of a certified company from a low cost housing business is subject to tax at the rate provided for in the First Schedule for a period of five years of assessment.

(2) The period specified in subparagraph (1) commences from the year in which operations commenced.

(3) Despite sections 8 and 9 of this Act, in calculating the income of the individual from conducting an employment, business or investment for a year of assessment, deduct mortgage interest incurred during the year.

(4) An individual may deduct mortgage interest in respect of only one residential premises during the lifetime of that individual.

(5) In this paragraph, unless the context otherwise requires,

certified company” means a company issued with a certificate from the Minister responsible for Works and Housing stating that it is engaged in a low cost housing business;

low cost housing business” means the business of construction for sale or letting of low cost affordable residential premises; and

mortgage interest" means interest incurred by an individual in respect of a borrowing employed in constructing or acquiring the individual's only place of residence.

  1. Approved unit trust scheme and mutual fund

(1) The income of an approved unit trust scheme or mutual fund is subject to tax at the rate provided for in the First Schedule for a period of ten years of assessment.

(2) The period specified in subparagraph (1) commences from the period in which the operations of the approved unit trust scheme or mutual fund commenced and includes the year in which the basis period of the trust or scheme ends.

(3)The interest and dividends paid or credited to a holder or member On an investment in an approved unit trust scheme or mutual fund is subject to tax at the rate provided for in the First Schedule.

(4) For the purpose of this paragraph, “approved unit trust scheme or mutual fund" means a scheme or fund approved under the Securities Industry Act, 1993 (PNDCL 333).

  1. Venture capital financing company

(1) The income of a qualifying venture capital financing company is subject to tax at the rate provided for in the First Schedule for a period of ten years of assessment.

(2) The period specified in subparagraph (1) commences from the year in which the company first qualifies.

(3) A loss incurred by a qualifying venture capital financing company may be carried forward for five years of assessment following the end of the period specified in subparagraph (1).

(4) Subparagraph (3) applies to a loss incurred by a venture capital financing company on the disposal of an investment in a venture capital subsidiary company under the Venture Capital Trust Fund Act, 2004 (Act 680) during the period referred to in subparagraph (1).

(5) A loss incurred by a qualifying venture capital financing company may be carried forward for five years of assessment after the year of disposal.

(6) Subparagraph (5) applies to a loss incurred by a venture capital financing company from the disposal of shares in a venture investment under section 17 of the Venture Capital Trust Fund Act, 2004 (Act 680) during a year of assessment.

(7) The interest and dividends paid or credited to a person on a qualifying investment in the company are subject to tax at the rate charged to that company under the first schedule for the period specified in subparagraph (1).

(8) For the purpose of this paragraph,

qualifying investment” means an investment by way of funding a qualifying venture capital financing company in accordance with the Venture Capital Trust Fund Act, 2004 (Act 680); and

qualifying venture capital financing company” means a company that satisfies the eligibility criteria for funding under the Venture Capital Trust Fund Act, 2004 (Act 680).

  1. Employment of graduate

(1) In calculating the income of a company from conducting a business for a year of assessment, the company is entitled to an additional deduction as provided in subparagraph (2) for salary and wages paid during the year to a fresh graduate from a recognised Ghanaian tertiary institution.

(2) The additional deduction specified in subparagraph (1) is as follows:

NO, PERCENTAGE OF FRESH GRADUATES IN WORKFORCE   ADDITIONAL DEDUCTION
1. Up to 1 percent 10 percent of salaries and wages
2. Above 1 percent but not more than 5 percent 30 percent of salaries and wages
3. Above 5 percent 20 percent of salaries and wages

 

(3) For the purpose of this paragraph “fresh graduate” means a person who has graduated from a tertiary institution for the first time, whether or not that person was previously employed.

  1. Free Zone company

(1) A Free Zone developer or an enterprise granted a licence under the Free Zones Act, 1995 (Act 504) is exempt from the payment of income tax on profits for the first ten years,

(2) The period specified in subparagraph (1) commences from the date of commencement of operation.

SEVENTH SCHEDULE

Tax Administration

(Section 139)

Responsibility for the administration of this Act

  1. Administration of this Act

(1) The Commissioner-General is responsible for the administration of this Act.

(2) Subject to subparagraph (3), the Commissioner-General may by notice in the Gazette or in writing authorise a person within or outside Ghana to perform or to assist in the performance of a function imposed on the Commissioner-General by this Act.

(3) The Commissioner-General shall not delegate the power to

(a) determine any matter or do anything required to be determined or done under subsections (5), (6), (7) and (8) of section 59:

(b) exempt a person from the provisions of section 116 (5)(b) other than to the Commissioner responsible for the Domestic Tax Revenue Division;

(c) compound an offence, other than to the Commissioner responsible for the Domestic Tax Revenue Division and Solicitor of the Authority; or

(d) remit taxes, Interest, or penalties provided in this Schedule.

(4) Subject to this Act and Regulations made under it, the Commissioner-General may m writing give administrative directives as the Commissioner-General considers necessary for the administration and implementation of this Act.

Official communication and documentation

  1. Practice note

(1) To achieve consistency in the administration of this Act and to provide guidance to persons affected by this Act and the officers of the Authority, the Commissioner-General may issue practice notes setting out the interpretation placed on provisions of this Act by the Commissioner-General.

(2) A practice note is binding on the Commissioner-General until revoked.

(3) A practice note is not binding on persons affected by this Act.

  1. Amendment and revocation of practice note

(1) The Commissioner-General may amend or revoke a practice note, in whole or part, by publishing a notice of the amendment or revocation in the Gazette and in a daily newspaper of national circulation.

(2) The subsequent enactment of legislation or issue of a practice note that is inconsistent with an existing practice note revokes the existing practice note to the extent of the inconsistency.

(3) The amendment or revocation of a practice note, in whole or part, has effect

(a) if subparagraph (1) applies, from the date specified in the notice of amendment or revocation and if a date is, not specified, from the date notice of the amendment or revocation is published in the Gazette and in a daily newspaper of national circulation; or

(b) if subparagraph (2) applies, from the date the inconsistent legislation or practice note applies.

(4) The amended or revoked part of a practice note

(a) continues to apply to arrangements commenced before the amendment or revocation; and

(b) does not apply to arrangements commenced after the amendment or revocation.

  1. Private ruling

(1) The Commissioner-General may, on an application in writing made by a person, issue to that person a private ruling setting out the position of the Commissioner-General regarding the application of this Act to that person with respect to a transaction proposed or entered into by that person.

(2) Where prior to issuing a ruling under subparagraph (1),

(a) the person in respect of whom the ruling is issued makes, a full and true disclosure of all aspects of the transaction relevant Co the ruling to the Commissioner-General, and

(b) the transaction proceeds in all material respects as described in the application of that person for the ruling, the ruling is binding

(c) on the Commissioner-General with respect to the application of this Act at the time of the ruling, and

(d) on that person with respect to the transaction.

(3) Where there is an inconsistency between a practice note and a private ruling, priority is to be given to the terms of the private ruling.

(4) The Commissioner-General shall

(a) specify the matters ruled on in a private ruling, identifying the tax laws, periods and arrangements to which the ruling applies as well as assumptions that affect the ruling; and

(b) identify the applicant and the Tax Identification Number of the applicant.

  1. Amendment and revocation of private ruling

(1) For reasonable cause, the Commissioner-General may by notice in writing served on the applicant, amend or revoke a private ruling, in whole or in part.

(2) An amendment made under subparagraph (1) shall accord with the requirements of subparagraph (4) of paragraph 4.

(3) Legislation enacted subsequent to a private ruling revokes the private ruling to the extent of its inconsistency with that legislation.

(4) The amendment or revocation of a private ruling, in whole or in part, has effect

(a) from the date specified in the note of the amendment or revocation, issued under subparagraph (1); or

(b) from the date of commencement of the legislation, in the case of legislation referred to in subparagraph (3).

(5) The amended or revoked part of a private ruling

(a) continues to apply to arrangements commenced before the amendment or revocation; and

(b) does not apply to arrangements commenced after the amendment or revocation.

  1. Tax Clearance Certificate

(1) The Commissioner-General shall not permit an importer or any other person to

(a) clear goods in commercial quantities, or

(b) clear goods meant for commercial purposes from a port or a factory in the country, unless the importer or other person produces to the Commissioner- General, a Tax Clearance Certificate issued in respect of the importer or that other person in the year of assessment in which the goods are to be cleared.

(2) Where any authority or person is empowered by an enactment to effect the registration of

(a) title to land, or

(b) a document conferring title to land,

that authority or person shall not effect the registration of that title or document unless there is produced to that authority or person, a Tax Clearance Certificate issued in the year of assessment in which the registration is to be effected and in respect of the person applying for the registration or in respect of the person on behalf of whom the application is made.

(3) A contract shall not be awarded by any agency or body in which public funds are vested to a person for the provision of services including consultancy services, unless that person produces to the agency or body a Tax Clearance Certificate issued by the Commissioner-General in respect of that person in the year of assessment in which the contract is to be awarded.

(4) A Tax Clearance Certificate issued under this paragraph is valid for the period and for the purposes determined by the Commissioner- General.

(5) A person who discharges the tax obligation of that person up to the end of the preceding year of assessment or the relevant quarter of the current year may be granted an all purpose ‘Tax Clearance Certificate valid for a period of not less than three months or valid for the subsequent quarter.

(6) Where a person is required to produce a Tax Clearance Certificate under this paragraph, and the certificate is not for a specific purpose, the person making the requisition shall first inspect the original certificate and thereafter demand and retain a copy of that certificate,

(7) In this paragraph,

Tax Clearance Certificate” means a certificate issued by the Commissioner-General to a person, stating

(a) that tax is not due under this Act by that person in respect of the periods stated in the certificate; or

(b) that the person has made arrangements satisfactory to the Commissioner-General for the payment of the tax due.

  1. Tax Identification Number

(1) For the purpose of identifying persons who are subject to tax under this Act, the Commissioner-General may issue a Tax Identification Number to a person.

(2) A person shall show the Tax Identification Number in any return, notice, or other document used for the purposes of this Act.

  1. Official language

(1) English is the official language of this country and the Authority may refuse to recognise a communication or document that is not in the official language.

(2)  Where a communication or document that is not in the official language is relevant in applying this Act to a taxpayer, the Commissioner-General may, in writing, require the taxpayer to provide a translation of the communication or document into the official language.

(3) The Commissioner-General shall serve the correspondence making the requisition under subparagraph (2) on the taxpayer.

(4) A taxpayer shall use a translator approved by the Commissioner- General and shall bear the expense of the translation.

(5) If a taxpayer fails to comply with subparagraph (2), the Commissioner-General may have the communication or document translated at the expense of the taxpayer.

  1. Official currency

(1) The Cedi is the official currency of this country and, subject to any provision in this Act to the contrary, an amount taken into account under this Act is to be denominated in or converted into Cedis.

(2) A person shall convert a foreign currency into Cedis at the Bank of Ghana inter-bank exchange rate applying on the date the amount is to be taken into account.

(3) The Commissioner-General may, on a written application by a person, require that person in writing, to take a foreign currency amount into account for purposes of this Act.

(4) A requirement of the Commissioner-General under subparagraph (3)

(a) may be by way of practice note;

(b) may apply for one or more periods;

(c) may be subject to conditions as the Commissioner-General determines; and

(d) has effect despite subparagraph (1).

(5) In exercising the discretion under subparagraph (3), the Commissioner-General shall take into consideration the volume of foreign currency activities conducted by the person.

(6) The Commissioner-General may, by notice in writing and for reasonable cause, revoke a requirement under subparagraph (3).

(7) In this paragraph, an amount is to be taken into account on the date the amount accrues, or is received, derived, incurred, paid or otherwise to be taken into account for the purposes of this Act.

  1. Forms and notices

(1) The Commissioner-General may specify the form of claims, forms, notices, returns, statements, and other documents required under this Act which shall contain the information required for the efficient administration of this Act.

(2) A person shall use a prescribed form when filing a document with the Commissioner-General or when a form is otherwise required for the purposes of this Act.

(3) The Commissioner-General shall make the prescribed forms available to the public at offices of the Authority and at other locations or by other medium as the Commissioner-General may determine.

  1. Authorised and defective documents

(1) A document issued by the Commissioner-General under this Act is sufficiently authenticated if the name or title of the Commissioner- General, or authorised tax officer, is

(a) in the case of a paper document, signed, printed, stamped or written on the document, or

(b) in the case of an electronic document, imbedded in the document by way of electronic signature or if the name or title of the Commissioner-General or authorised officer, is signed or written on the notice or document.

(2) A document issued under this Act is not invalid or defective, if

(a) it is in substance and effect, in conformity with the law; and

 (b) the person to whom the document is addressed or to whom it applies is designated in the document according to common understanding.

(3) Subject to subparagraph (5), the Commissioner-General may amend a document issued by the Commissioner-General under this Act for purposes of rectifying a defect in the document.

(4) Subparagraph (3) applies where

(a) a document issued by the Commissioner-General under this Act contains a defect; and

(b) that defect involves a dispute as to the interpretation of this Act or facts involving a particular person.

(5) Where subparagraph (4) applies, the Commissioner-General may dispute the defect, but may not amend that part of the document that contains the defect.

(6) The Commissioner-General may amend a practice note or private ruling, but only in accordance with paragraph 3 or 5, as the case requires,

  1. Paper documents filed with Commissioner-General

(1) A paper document is filed with the Commissioner-General under this Act if that document is

(a) delivered to an office of the Authority; or

(b) sent by post to an office of the Authority.

(2) A document referred to in subparagraph (1) is treated as received by the Commissioner-General

(a) when the document is posted, as long as it is received in an office of the Authority within a reasonable time; or

(b) in any other case, when the Authority acknowledges it by stamping.

  1. Service of paper documents

(1) The Commissioner-General or a tax officer sufficiently serves a paper document on a person under this Act if the document is

(a) handed to that person or, in the case of an entity, a manager of the entity;

(b) left at or sent by post to the usual or last known place of abode, business, office, post office box or other address of the person; or

(c) sent by registered post addressed to the usual or last known place of abode, business, office, post office box or other address of the person.

(2) For purposes of subparagraph (1), the address of a person includes

(a) the address specified on the Tax Clearance Certificate of that person; and

(b) any ship to which the person belongs or has lately belonged.

(3) A document is considered served at the following time:

(a) in the case of service by handing to a person or leaving at a place, at the time of handing or leaving;

(b) in the case of service by registered post, at the time the document is delivered or the person is informed that the document awaits collection by the person;

(c) in the case of other service by post to an address within the country, seven days after posting; and

(d) in the case of other service by post to an address outside of the country, the time at which the document would normally be delivered in the ordinary course of post.

  1. Electronic document system

(1) The Commissioner-General may establish and operate a system for

(a) electronic filing of documents with the Commissioner-General;

(b) electronic service of documents by the Commissioner. General; and

(c) electronic payments by persons.

(2) For this purpose, the Commissioner-General may prescribe rules concerning

(a) registration of persons who wish to participate in the system, including issue and cancellation of authentication codes;

(b) types of documents that may be transmitted through the system, including format and manner of transmission and the issue and cancellation of document registration numbers;

(c) resolution of difficulties, including correction of errors, amendment of documents and procedure on breakdown or interruption of the system;

(d) secrecy to be maintained, whether by persons using the system on their own behalf or using the system on behalf of other persons, and

(e) any other matter for the better administration of the system, including those referred to in section 26(2) of the Electronic Transactions Act, 2008 (Act 772).

(3) An electronic document is considered filed by a person and received by the Commissioner-General under this Act when a document registration number is created using the authentication code of that person.

(4) Subparagraph (3) does not apply where the person proves to the satisfaction of the Commissioner-General that the person did not send the document and the document was not sent with the authority of that person.

(5) An electronic document is considered served on a person by the Commissioner-General under this Act when a document registration number is created and the document can be accessed using the authentication code of that person.

(6) The Commissioner-General may authorise a printed document as a copy of an electronic document filed under subparagraph (3) or served under subparagraph (5).

(7) A court or tribunal shall accept a copy authorised under subparagraph (6) as conclusive evidence of the nature and contents of an electronic document, unless the contrary is proved.

  1. Interpretation

In paragraph 2 to 14, unless the context otherwise requires, “document” includes an assessment, ruling, notice, or certificate.

Records and information collection

  1. Accounts and records

(1) Unless otherwise authorised by the Commissioner-General, a person required to be registered with the Commissioner-General under this Act other than an employee with respect to the employment income of that person shall, maintain in the country, the necessary records to explain the information to be provided in a return or in any other document to be furnished to the Commissioner-General under this Act or to enable an accurate determination of the tax payable or income earned by that person.

(2) The necessary records required to be maintained by a person includes all underlying documents however described in the nature of receipts, invoices, vouchers, contracts or any electronic data from which information can be extracted.

(3) Where a person does not maintain records as required by subparagraph (1), the Commissioner-General may adjust the liability of that person to tax, in a manner that is consistent with the intention of this Act.

(4) The person shall retain the records referred to in this paragraph for a period of not less than six years, unless the Commissioner-General otherwise specifies in writing.

(5) For the purposes of this paragraph, the records to be maintained by a business include a record of all receipts and payments, all revenue and expenditure, and all assets and liabilities of the business.

  1. Record of shareholders of company

A company which is incorporated under the laws of Ghana or has its Management and control exercised in the country at any time during the year of assessment, shall

(a) maintain a register of members reflecting the names and addresses of the members available in the country; and

(b) in the case of a company having shares, maintain

(i) a statement of the shares held by each member distinguishing each share by a number where the share has a number, and the amount paid or agreed to be considered as paid on the shares of each member and the amount remaining payable on the shares;

(ii) the date on which the person was entered in the register as a member; and

(iii) the date on which that person ceased to be a member.

  1. Access to books, records, computers and other electronic device

(1) For purposes of administering this Act, the Commissioner- General, or an officer authorised in writing by the Commissioner- General,

(a) shall have at all times and without any prior notice full and free access to any premises, place, property, book, record, computer or other electronic storage device;

(b) may make an extract or copy from any book, record, or computer-stored information to which access is obtained under sub- subparagraph (a)

(c) may seize any book, record, other document, computer or other electronic storage device that, in the opinion of the Commissioner-General or authorised officer, affords evidence which may be material in determining the liability of a person to tax, interest, or penalty under this Act;

(d) may retain a book or record for as long as it may be required for determining the tax liability of a person or for any proceeding under this Act;

(e) may, where a hard copy or information stored on a computer or electronic storage device is not provided, seize and retain the computer or device for as long as is necessary to copy the information required; and

(f) for the purposes of sub-subparagraph (a) to (c), may search a person entering or leaving any premises or place.

(2) An officer shall not exercise a power under subparagraph (1) without authorisation in writing from the Commissioner-General and the officer shall produce the authorisation to the occupier of the premises or place to which the exercise of the power relates.

(3) For the purposes of this paragraph, the Commissioner-General may request the Inspector-General of Police for the requisite assistance for a specific assignment.

(4) The occupier of the premises or place to which an exercise of a power under subparagraph (1) relates shall provide all reasonable facilities and assistance for the effective exercise of the power.

(5) A person whose. books, records, computer or electronic storage device have been removed and retained under subparagraph (1) may examine them and make copies or extracts from them, at that person's expense, during regular office hours under the supervision determined by the Commissioner-General.

(6) All records, books, computers or electronic storage device removed and retained under subparagraph (1) shall be signed for by the Commissioner-General or an authorised officer and the Commissioner- General shall return them to the owner as soon as is practicable after the investigation by the Commissioner-General of the affairs of that person and any related proceedings have been concluded.

(7) This paragraph has effect despite any rule of law relating to privilege or the public interest with respect to the production of, or access to, the documents.

(8) In this paragraph, “occupier” in relation to premises or a place includes the owner, manager, or any other person on the premises or place.

  1. Notice to obtain information or evidence

(1) The Commissioner-General may, by notice in writing, require a person, whether or not liable to tax under this Act,

(a) to furnish, including by way of creation of a document, within the time specified in the notice, information that may be required by the notice; or

(b) to attend at the tune and place designated in the notice for the purpose of being examined on oath by the Commissioner-General or by an officer authorised by the Commissioner-General, concerning the tax affairs of that person or any other person and, for that purpose, the Commissioner-General or an authorised officer may require the person examined to produce any book, record, or computer-stored information in the control of that person.

(2) Where the notice requires the production of a book, record, or electronically-stored information, it is sufficient if the book, record, or electronically -stored information is described with reasonable certainty in the notice.

(3) A person to be examined on oath under subparagraph (1) (b) is entitled to legal or other representation throughout the examination.

(4) A notice issued under this paragraph shall be served by, or at the direction of, the Commissioner-General by a signed copy delivered by hand to the person to wham it is directed or left at the last and usual place of business or abode of that person.

(5) This paragraph has effect notwithstanding any rule of law or enactment in relation to the production of, or access to, the documents or information.

  1. Official secrecy

(1) A person appointed under, or employed in carrying out the provisions of this Act

(a) shall regard and deal with all documents and information which may come to the possession or knowledge of that person in connection with the performance of functions under this Act as secret, and

(b) shall not disclose any document or information except in accordance with this Act or under an order of a superior court.

(2) Nothing in this paragraph shall prevent the disclosure of information or documents to

(a) the Minister responsible for Finance or any other person where the disclosure is necessary for the purposes of this Act or any other fiscal law;

(b) a person in the service of the Government in a revenue or statistical department where the disclosure is necessary for the performance of official duty;

(c) the Auditor-General or a person authorised by the Auditor- General where the disclosure is necessary for the performance of official duty; or

(d) the competent authority of the Government of another country with which the country has entered into an agreement for the avoidance of double taxation or for the exchange of information, to the extent permitted under that agreement.

(3) A person who receives documents and information under subparagraph (1) or (2) shall keep the documents and information secret under this paragraph, except to the minimum extent necessary to achieve the purpose for which the disclosure is necessary.

Objections and appeals

  1. Objection to assessment

(1) A person who is dissatisfied with an assessment made under this Act may lodge an objection to the assessment with the Commissioner-General

(a) within thirty days of the service of the notice of assessment; or

(b) in the case of an estimate under section 123, within nine months of the commencement of the basis period to which the estimate relates.

(2) An objection to an assessment shall, be in writing and state precisely the grounds upon which the objection is made

.(3) The Commissioner-General may, on an application in writing by an objector, extend the time for lodging an objection where the Commissioner-General is satisfied that the delay in lodging the objection is due to

(a) the fact that the objector is absent from the country;

(b) sickness; or

(c) other reasonable cause.

(4) After the determination of the objection, the Commissioner-General may allow the objection in whole or in part and amend the assessment accordingly, or disallow the objection.

(5) As soon as is practicable after allowing or disallowing an objection, the Commissioner-General shall serve the objector with notice of the decision.

(6) Where a decision has not been made by the Commissioner-General within ninety days after the abjection was lodged with the Commissioner-General, the objector may, by notice in writing to the Commissioner-General, elect to treat the Commissioner-General as having made a decision to disallow the objection,

(7) Where an objector makes an election under subparagraph (6), the objector is treated as having been served with a notice of the disallowance on the date the objector lodges an election with the Commissioner- General.

  1. Appeal to Court

(1) A person who is dissatisfied with a decision on an objection lodged with the Commissioner-General may appeal against the decision to the High Court.

(2) An appeal under subparagraph (1) shall be made by lodging five copies of the notice of appeal together with five copies of all relevant documents with the Registrar of the High Court within thirty days after service of the notice of the decision.

(3) A person may lodge a notice of appeal within three months after the date specified in subparagraph (2) if that person proves to the satisfaction of the Court that the delay in lodging the notice of appeal is due to

(a) absence of that person from the country,

(b) sickness, or

(c) other reasonable cause and that there has not been an unreasonable delay on the part of that person.

(4) A person who has lodged a notice of appeal with the Registrar of the High Court under subparagraph (2) or (3) shall, within five working days of doing so, serve a copy of the notice of appeal on the Commissioner-General,

(5) The High Court may confirm, reduce, increase or annul the assessment on which the decision is based or make an appropriate order.

  1. Appeal to Court of Appeal and Supreme Court

(1) The Commissioner-General or the appellant may appeal against the decision of the High Court made under subparagraph (5) of paragraph 22 to the Court of Appeal on a matter of law only.

(2) An appeal against a decision of the Court of Appeal under subparagraph (1) shall lie as of right to the Supreme Court.

(3) An appeal under subparagraph (1) or (2) shall be made within thirty days after the decision to which it relates.

  1. Payment of tax

(1) When a person has lodged a notice of objection to a notice of assessment under paragraph 21, an amount of thirty percent of the amount payable as contained in the notice of assessment shall be paid pending the determination of the objection.

(2) An application, action, or appeal shall not be entertained by a court in respect of an objection under paragraph 21 unless the person to whom the decision relates has paid the amount specified under subparagraph (1).

(3) Where the payment of tax has been held over pending an objection or appeal, any tax outstanding under the assessment as determined by the Commissioner-General is payable within thirty days from the date of service of the notice of the decision of the Commissioner- General or where the decision has been appealed against, within thirty days from the date of the decision of the Court.

(4) a person is required to pay tax as a result of a decision taken by the Commissioner-General in respect of an objection under paragraph 21 or as a result of a court decision under paragraphs 22 and 23, the person shall pay, in addition to the tax payable, interest at the minimum prevailing bank rate on the tax payable from the date of the service of the notice of assessment to the date the person pays the amount determined on objection or on appeal.

Proof

  1. Proof Burden of proof

In an objection to an assessment under paragraph 21 or on an appeal under paragraph 22, the onus is on the person assessed to prove, on the balance of probabilities, the extent to which the assessment made by the Commissioner-General is excessive or erroneous.

Tax returns

  1. Tax returns

(1) An individual or the authorised agent of that individual shall sign a tax return to be filed by that individual and declare in that return that the return is complete and accurate.

(2) A duly authorised manager of an entity shall sign a tax return to be filed by that entity and declare in that return that the return is complete and accurate.

(3) If any of the circumstances specified in subparagraph (6) exist before the date for filing a tax return, the Commissioner-General may, in writing, require a person to file a tax return.

(4) The Commissioner-General shall specify in the requisition made under subparagraph (3), the period, part of a period or other events to be coveted by the tax return, and the date by which the return is to be filed.

(5) The Commissioner-General shall serve a copy of the requisition made under subparagraph (3) on the person.

(6) Revenue is at risk in the following circumstances:

(a) where the person becomes bankrupt, is wound-up or goes into liquidation;

(b) where the Commissioner-General believes on reasonable grounds that the person

(i) is about to leave the country indefinitely;

(ii) is otherwise about to cease activity in the country; or

(iii) has committed an offence under this Act; or

(c) where the Commissioner-General otherwise considers it appropriate, including where the person fails to maintain adequate documentation as required by paragraphs 18 and 19.

  1. Assistance in preparing tax return

(1) A person who, for remuneration, prepares or assists in the preparation of a tax return or an attachment to a tax return of another person, shall sign the return

(a) specifying the extent to which the person has examined the relevant documents of the other person maintained under paragraphs 17 and 18 and the nature of the documents examined, and

(b) certifying that, to the best of knowledge of that person, the return or attachment presents a true and fair view of the circumstances to which it relates.

(2) Subparagraph (1) does not apply to an employee of the person who is obliged to file the tax return.

(3) Where a person objects to signing a tax return as required by subparagraph (1), that person shall

(a) submit to the other person a statement of the reasons for the refusal, in writing; and

(b) sign the return, and emboss a caveat on that return that the signature is subject to the statement referred to under sub-subparagraph (a).

(4) Where a person submits a statement under subparagraph (3) (a), the other person for whom the return is prepared shall, attach that statement to the return when filing the return.

  1. Extension of time to file tax return

(1) A person who is required to file a tax return under this Act may apply to the Commissioner-General for an extension of the time to file the return.

(2) The person shall, in writing, make the application by the due date for filing the return.

(3) Where a person makes an application under subparagraph (1), the Commissioner-General may extend the date by which the return is to be filed if the Commissioner-General is of the opinion that that person has shown reasonable cause.

(4) The extension may be subject to terms and conditions as the Commissioner-General thinks appropriate, including the payment of security.

(5) The Commissioner-General shall serve the person with written notice of the decision of the Commissioner-General on an application under subparagraph (1).

(6) The Commissioner-General may grant multiple extensions, but the extensions shall not in total exceed sixty days from the date the return was originally to be filed.

(7) The grant of an extension under this paragraph does not alter the date for payment of tax as specified in this Act.

  1. Failure to file tax return on time

(1) This paragraph applies where a person fails to file a tax return by the due date required by this Act.

(2) The Commissioner-General may use the power in paragraph 19 to appoint another person to prepare and file any information as the Commissioner-General may require, including information required by the return.

(3) The Commissioner-General shall make an assessment of the tax liability of the person as required by this Act, including by way of adjusted assessment.

(4) For the purpose of subparagraph (3), the Commissioner- General may use any information in the possession of the Commissioner-General including information obtained in accordance with subparagraph (2).

(5) A tax return filed after the due date or in a manner other than that specified in this Act does not have effect on a tax decision of the Commissioner-General, including an assessment made under subparagraph (3), but the Commissioner-General shall take the tax return into account in deciding whether or not to issue an adjusted assessment.

  1. Correction of tax returns and other information

(1) If the Commissioner-General is not satisfied with a tax return filed under this Act the Commissioner-General shall use appropriate powers, including those specified in paragraphs 18 and 19 to gather further information as is necessary to make an assessment.

(2) A person may not amend or correct a tax return without the permission of the Commissioner-General after the due date for filing that return.

(3) A person shall file further information with the Commissioner- General when the person discovers that any information filed with the Commissioner-General in a tax return or otherwise is incorrect or misleading in a material particular.

(4) The Commissioner-General may take into account any information received under subparagraph (3) in making an assessment or adjusted assessment.

Assessment

  1. Assessment

(1) Assessment of tax is made by way of

(a) self-assessment, where the person is obliged to file a tax return; and

(b) the Commissioner-General making an assessment in other cases, including where a self-assessment is adjusted.

(2) Where a person files a self-assessed tax return, the assessments treated as

(a) made on the due date for filing the tax return; and

(b) an amount equal to the net amount of tax due as shown in the tax return.

(3) The Commissioner-General may adjust an assessment.

(4) The Commissioner-General may make an assessment at any time, including an adjusted assessment in the case of discovery of new information, fraud, wilful default or serious omission by or on behalf of the taxpayer,

(5) Subject to subparagraph (4), the power of the Commissioner-General to make an original assessment expires six years from the date on which the Commissioner-General was first entitled to make the assessment.

(6) Subject to subparagraph (4), the power of the Commissioner- General to make an adjusted assessment expires six years from

(a) the due date for filing the tax return that gives rise to the assessment or, if later, the date the tax return is filed, where a self-assessment is adjusted;

(b) the date on which the Commissioner-General serves the notice of assessment on the taxpayer, where any other original assessment is adjusted; or

(c) the date referred to in sub-subparagraph (a) or (b) in respect of the original assessment that is adjusted where an adjusted assessment is adjusted.

(7) An assessment made under this paragraph is treated as made under the relevant provision that charges the person or subject matter assessed.

  1. Pre-emptive assessment and security

(1) In the circumstances specified in paragraph 26(6), the Commissioner-General may make a pre-emptive assessment of tax payable or to become payable by a person under this Act, whether or not the person is required to file a tax return.

(2) The Commissioner-General may, instead of making a pre-emptive assessment, accept from a person, security for outstanding and future tax liabilities as the Commissioner-General thinks appropriate.

(3) The Commissioner-General shall use best judgement and information reasonably available in making a pre-emptive assessment or fixing the amount of security.

(4) A pre-emptive assessment may be for a period or with respect to an event or subject matter as the Commissioner-General may specify in the notice of assessment.

(5) Unless the Commissioner-General specifies otherwise in the notice of assessment, a pre-emptive assessment does not relieve a person of the obligation to file a tax return or otherwise report a taxable event as required by this Act.

(6) The filing of a tax return, including where the filing of the return results in a self-assessment, does not affect a pre-emptive assessment.

(7)  Any tax paid with respect to a pre-emptive assessment is credited against tax payable with respect to a self-assessment that covers the same period, events and tax.

  1. Adjusted assessment

(1) The Commissioner-General may adjust an assessment in a manner as to ensure the taxpayer is liable for the correct amount of tax in the circumstances to which the assessment relates.

(2) The Commissioner-General shall use best judgement and information reasonably available in making an adjusted assessment.

(3) The Commissioner-General shall not adjust an assessment that has been adjusted pursuant to a decision of a court of competent jurisdiction, unless the decision is vacated.

(4) An assessment ceases to have effect to the extent to which it is adjusted.

  1. Notice of assessment

(1) Where the Commissioner-General makes an assessment under this Act, the Commissioner-General shall serve a written notice of the assessment on the taxpayer.

(2)  In addition to any requirement of this Act, the Commissioner- General shall state in the notice of assessment,

(a) the name and the tax identification number of the taxpayer;

(b) the tax assessed by the Commissioner-General to be payable by the taxpayer for the period, event or matter to which the assessment relates;

(c) the amount of that tax remaining to be paid after any relevant credits, reductions or pre-payments;

(d) the manner in which the assessment is calculated;

(e) the reasons why the Commissioner-General has made the assessment;

(f) the date by which the tax is to be paid; and

(g) the time, place and manner of objecting to the assessment.                

Payment and recovery of tax

  1. Time for paying tax

(1) Subject to this Act, tax assessed is due on the date on which the person assessed is served with a notice of assessment.

(2)  Despite subparagraph (1), tax is payable

(i) in the case of tax assessed under paragraph 31 or 33, on the date specified in the notice of assessment served under paragraph 34;

(ii) in the case of an adjusted assessment of tax under para- graph 33, thirty days from the date on which the person assessed is served with a notice of assessment under paragraph 34;

(iii) in the case of interest and penalties under paragraph 54, on the date specified in the notice of assessment served under paragraph 34;

(iv) with respect to amounts required to be paid to the Commissioner-General by foreign tax debtors, as costs of charge and sale, by third party debtors or by agents of non-residents, on the date set out in the relevant notice;

(v) with respect to a liability under paragraph 45, at the same time as the tax is payable by the entity: or

(vi) with respect to amounts required to be paid to the Commissioner-General under paragraph 46, seven days after the sale from which the amount is set aside or the failure to set aside, respectively.

(3) Subject to paragraphs 22 and 23, tax remains payable despite any dispute or review proceedings, irrespective of whether the proceedings are administrative, judicial, quasi-judicial or appellate in nature.

  1. Extension of time for paying tax

(1) A taxpayer may apply, in writing, to the Commissioner-General for an extension of time to pay tax under this Act.

(2) On the receipt of an application under subparagraph (1), the Commissioner-General may, where good cause is shown, extend the date on which the tax or part of the tax is payable on terms and conditions determined by the Commissioner-General.

(3) An extension of time to pay shall not exceed six months, but a taxpayer may re-apply to the Commissioner-General before the end of an extension,

(4) The Commissioner-General shall serve the applicant with a written notice of the decision of the Commissioner-General on the application,

(5)  Where an extension is granted by permitting the taxpayer to pay by instalments and the taxpayer defaults in paying any of the instalments, the whole balance of the tax outstanding becomes payable immediately.

  1. Manner of paying tax

(1) The Minister may, by legislative instrument, make Regulations to prescribe

(a) the manner and form in which tax is to be paid;

(b) for the procedure by which the Commissioner-General may approve banks to accept payment of tax and related matters, including

(i) the form of payments that approved banks may accept; and

(ii) the manner in which approved banks shall account to the Commissioner-General for tax received; an

(c) limits on the quantum of tax that may be paid and the form of payment that may be accepted at particular offices of the Authority.

(2) Where a cheque tendered in payment of tax is dishonoured, the payment is ineffective and the Commissioner-General may use all available powers to recover the tax.

  1. Order of tax payment

(1) This paragraph applies where a taxpayer has more than one amount of tax payable, whether under one or more tax laws, and the taxpayer makes payment that is less than the total amount outstanding.

(2) Despite paragraph 39, where this paragraph applies, the Commissioner-General may, determine which amount of tax is considered paid.

  1. Electronic tax accounts

(1) The Commissioner-General may establish and operate an electronic system of taxpayer tax accounts.

(2) The system may be established and operated separately or as part of the electronic document system established under paragraph 14.

(3) For this purpose, the Commissioner-General may prescribe and publish in the Gazette, rules concerning

(a) debiting of tax when it becomes payable;

(b) crediting of tax paid;

(c) allocation of tax paid against tax payable; and

(d) other matters of the type described in paragraph 14.

  1. Tax as a debt due to the Authority

(1) Tax which has become due and payable to the Authority, is a debt owed to the Authority and is payable to the Commissioner-General in the manner and at the place prescribed by the Minister.

(2) The Commissioner-General may sue in a court for tax that has not been paid when it is due and payable and recover the costs of suit.

  1. Collection of tax by distress

(1) The Commissioner-General may recover an unpaid tax by distress proceedings against the movable property of a person liable to pay tax.

(2) The Commissioner-General may commence the distress proceedings by issuing an order in writing specifying

(a) the person against whose property the proceedings are authorised;

(b) the location of the property; and

(c) the tax liability to which the proceedings relate.

(3) The Commissioner-General may require a police officer to be present while distress is being executed.

(4) For the purposes of executing distress under subparagraph (1), the Commissioner-General may, at any time, enter any house or premises described in the order authorising the distress proceedings.

(5) The property upon which distress is levied under this paragraph other than perishable goods, shall be kept for ten days at the cost of the tax debtor at

(a) the premises where the distress is levied; or

(b) at any other place that the Commissioner-General considers appropriate.

(6) Where the tax debtor does not pay the tax due, together with the costs of the distress,

(a) in the case of perishable goods, within a period that the Commissioner-General considers reasonable having regard to the condition of the goods; or

(b)  in any other case, within fourteen days after the distress is levied, the property distrained may be sold by public auction or in any other manner directed by the Commissioner-General.

(7) The auctioneer or seller shall apply the proceeds of a disposal under subparagraph (6) in the following order:

(a) the tax due and payable; and

(b) the cost of taking, keeping and selling the property distrained and the remainder of the proceeds, shall be given to the tax debtor.

(8) This paragraph shall not preclude the Commissioner-General from other proceedings under this Act with respect to the balance owed if the proceeds of the distress are not sufficient to meet the costs of the distress and the tax due.

(9) The Commissioner-General may recover all costs incurred by the Commissioner-General in respect of any distress from the tax debtor and this Schedule shall apply as if the costs were tax due and payable.

(10) A property distrained under this paragraph shall be identified by the posting or hanging of a piece of ribbon or cloth determined by the Commissioner-General to or on a conspicuous place of the property.

  1. Security on landed property for unpaid tax

(1) Where a person, who is the owner of land or buildings situated in the country, fails to pay tax when it is due and payable, the Commissioner-General may, by notice in writing, give notice to that person of the intention to apply to the Chief Registrar of Lands, for the land or buildings to be the subject of security for tax as specified in the notice.

(2) If a person on whom a notice has been served under this paragraph fails to make payment of the whole of the amount of the tax specified in the notice within thirty days of the date of service of the notice under subparagraph (1), the Commissioner-General may, by notice in writing, in this paragraph referred to as a “notice of direction”, direct the Chief Registrar that the land or buildings of that person, to the extent of the interest of that person in the land or buildings, be the subject of security for unpaid tax in the amount specified in the notice.

(3) Where a notice of direction is served on the Chief Registrar under subparagraph (2), the Chief Registrar shall, without fee, register the direction as if it were an instrument or mortgage over, or charge on, the land or buildings and the registration shall, subject to any prior mort- gage or charge, operate in all respects as a legal mortgage over or charge on the land or building to secure the amount of the unpaid tax.

(4) Where the Commissioner-General receives the whole of the amount of tax secured under subparagraph (3), the Commissioner- General shall serve notice on the Chief Registrar cancelling the direction made under subparagraph (2) and the Chief Registrar shall, without fee, record the cancellation at which time the notice of direction shall cease to have effect.

  1. Recovery of tax from person owing money to tax debtor

(1) Subject to subparagraph (2), where a tax debtor has not paid tax which is due, the Commissioner-General may, by notice in writing, require any other person

(a) owing or who may owe money to the tax debtor,

(b) holding or who may subsequently hold money for, or on account of, the tax debtor,

(c) holding or who may subsequently hold money on account of a third person for payment to the tax debtor, or

(d) having authority from a third person to pay money to the tax debtor, to pay the money to the Commissioner-General on the date set out in the notice, up to the amount of tax due.

(2) The Commissioner-General may only issue a notice under subparagraph (1) with respect to tax which is due but not currently payable where the Commissioner-General reasonably believes that the tax debtor will not pay the tax by the date on which the tax becomes payable.

(3) The date specified in the notice under subparagraph (1) shall not be a date before the money becomes due to the tax debtor, or is held on behalf of the tax debtor.

(4) At the same time that notice is served under subparagraph (1), the Commissioner-General shall also serve a copy of the notice on the tax debtor.

(5) Where a person served with a notice under subparagraph (1) is unable to comply with the notice by reason of lack of moneys owing to or held for the tax debtor, that person shall, as soon as is practicable and in any event not later than the payment date specified in the notice, notify the Commissioner-General accordingly in writing setting out the reasons for the inability to comply.

(6) Where a notice is served on the Commissioner-General under subparagraph (5), the Commissioner-General may, by notice in writing,

(a) accept the notification and cancel or amend the notice issued under subparagraph (1); or

(b) reject the notification.

(6) A person who is dissatisfied with a decision under subparagraph (6) may only challenge the decision under the objection and appeal procedure under paragraph 21 to 23.

(7)  A person making a payment under a notice under subparagraph (1) is considered to have been acting under the authority of the tax debtor and of all other persons concerned and is indemnified in respect of the payment against all proceedings, civil or criminal, and all processes, judicial or extra-judicial, despite any provisions to the contrary in any law, contract, or agreement.

(8)  This Schedule applies to any amount due under this paragraph as if it were tax due and payable.

  1. Restraint of person

(1)  Where a person other than a citizen fails to pay tax on due date, the Commissioner-General may, by notice in writing to the Director of Immigration, require the Director of Immigration to prevent the person from leaving the country,

(2) The Director of Immigration shall, on receipt of a notice under subparagraph (1), prevent the person from leaving the country for a period of seven days from the time the notice is served on the Director of Immigration.

(3) The Commissioner-General shall withdraw a notice under sub- paragraph (1), where the person pays the tax or arranges for payment of the tax in a manner satisfactory to the Commissioner-General.

(4) The High Court may extend the period referred to in subparagraph (2), on an application by the Commissioner-General.

  1. Manager of an entity

(1) Where an entity fails to pay tax on time, a person who is or has been a manager of that entity during the relevant time is jointly and severally liable with the entity for payment of the tax.

(2) Subparagraph (1) applies irrespective of whether the entity ceases to exist.

(3) Subparagraph (1) does not apply to a manager who has exercised the degree of care, diligence, and skill that a reasonably prudent person in the position of the manager would have exercised in preventing the initial and continuing failure to pay tax.

(4) The defence in subparagraph (3) is not available in the case of a manager who is a current partner of a registered partnership.

(5) An amount payable to the Commissioner-General by a manager under this paragraph is a personal tax liability of the manager.

(6) Where a manager pays tax by reason of a liability under subparagraph (1), the manager may recover the payment from the entity as a debt due.

(7)  In this paragraph,

manager” of an entity includes a person purporting to act as a manager of that entity; and

relevant time” means six months before the events that give rise to the tax liability of the entity.

  1. Duties of a Receiver

(1) A person appointed to the position of a receiver of an asset situated in the country shall, in writing, give notice to the Commissioner-General of that appointment

(a) within fourteen days from the date of the appointment, or

(b) on the date the person takes possession of that asset, whichever occurs first.

(2)  A receiver shall not distribute assets unless the receiver has accounted for the assets to the Commissioner-General.

(3) The executor of an estate of a deceased individual or the legal representative of a person who is incapacitated shall complete and submit returns required under this Act on behalf of the deceased or incapacitated person with respect to matters occurring prior to the appointment of the executor or legal representative.

(4) The Commissioner-General shall, within fourteen days of receiving a notice under subparagraph (1), serve the receiver with a notice in Writing specifying an amount that appears to the Commissioner-General to be sufficient to provide for tax due by the taxpayer or that will become due by the taxpayer.

(5) A receiver shall, after receiving a notice under subparagraph (4),

(a) sell sufficient assets to raise the amount of outstanding tax liability referred to in the notice, after payment of any debts that has priority; and

(b) from the proceeds of the sale pay to the Commissioner-General the outstanding tax liability of the taxpayer.

(6) In making payment out of the proceeds of the sale of assets, a receiver shall give priority to unpaid value added tax and withholding tax over all other debts of the taxpayer.

(7) Subparagraph (6) does not apply to a secured debt.

(8) To the extent that a receiver fails to raise an amount as required by subparagraph (5) that receiver is personally liable to pay to the Commissioner-General on account of the tax liability of the taxpayer, the amount that should have been raised.

(9) An amount payable to the Commissioner-General by a receiver under this paragraph is a personal tax liability of the receiver.

(10) In this paragraph,

receiver” means a person who, with respect to an asset situated in the country, is

(a) a liquidator of an entity;

(b) a receiver appointed out of court or by a court in respect of an asset or entity;

(c) trustee for a bankrupt person;

(d)  a mortgagee in possession;

(e) an executor, administrator or heir of the estate of a deceased individual;

(f) conducting the affairs of an incapacitated individual; or

(g) a successor in a corporate reorganization;

relevant assets” means assets held in the capacity of a person as receiver; and

taxpayer” means the person whose assets come into the possession of the receiver and includes a deceased individual and an entity that is reorganised.

  1. Recovery from agent of non-resident

(1) The Commissioner-General may, by notice in writing, require a person who is in possession of an asset, including money, belonging to a non-resident person to pay tax on behalf of the non-resident person, up to the market value of the asset but not exceeding the amount of tax due.

(2) The captain of an aircraft or ship owned or chartered by a non-resident person is deemed to be in possession of the aircraft or ship for the purposes of this paragraph.

(3) The tax payable in respect of an amount included in ascertaining the income of a non-resident partner under section 54 is assessable in the name of the partnership or of a resident partner of the partnership and may be recovered out of the assets of the partnership or from a resident partner personally.

(4) The tax payable in respect of an amount included in ascertaining the income of a non-resident beneficiary under section 57 is assessable m the name of the trustee and may be recovered out of the assets of the trust or from the trustee personally.

(5) A person who makes a payment pursuant to a notice under subparagraph (1) is considered to have been acting under the authority of the non-resident person and of all other persons concerned and is indemnified in respect of the payment against all proceedings, civil or criminal, and all processes, judicial or extra-judicial, despite any provision to the contrary in any law, contract, or agreement.

(6) The provisions of this paragraph apply to an amount due under this paragraph as if it were tax due and payable.

Interest and penalties

  1. Failure to maintain records

(1) A person who fails to maintain proper documents as required by this Act is liable to pay a penalty for the period during which the failure continues.

(2)The penalty is

(a) where the failure is deliberate or reckless, seventy-five percent of the tax attributable to that period; or

(b) the lesser of the amount referred to in sub-subparagraph (a) or two hundred and fifty currency points, in any other case.

(3) The Commissioner-General shall determine tax attributable to a period on a just and reasonable basis including

(a) apportioning the tax assessed with respect to a larger period: or

(b) by reference to taxable events happening within that period.

  1. Failure to furnish return

(1) A company or a self-employed person that fails to submit to the Commissioner-General, an estimate or return of income, or any other return required by the Commissioner-General within the time required under this Act is liable to pay

(a) a penalty of four currency points in the case of entities; and

(b) a penalty of two currency points, in the case of an individual for each day that the return remains outstanding.

(2) The penalty applies separately to a failure to file an estimate and a failure to file a tax return incorporating the final amount.

(3) Where the person does not submit the return four months after the imposition of the penalty for non-submission, the Commissioner: General shall, in addition, prosecute the person to compel the person to submit the return.

  1. Failure to pay tax on due date

(1)  A person who fails to pay tax on or before the date on which the tax is payable is liable to pay an interest on the tax amount due for the period for which any of the tax is outstanding.

(2) The interest is calculated as one hundred and twenty-five percent of the statutory rate, compounded monthly, and applied to the amount outstanding at the start of the period.

(3) For the purposes of calculating interest under subparagraph (1),

(a) tax is payable

(i) in the case of an adjusted assessment, on the date on which tax is payable under the original assessment; and

  (ii) otherwise, on the date specified in paragraph 35; and

(b) any suspension granted under paragraph 24 or extension granted under paragraph 28 or 36 is ignored.

(4) Where a withholding agent is liable for interest for failing to pay withholding tax in respect of a payment made by the agent, the agent shall not recover the interest from the person subject to withholding tax.

  1. Understating estimated tax payable by instalment

(1) This paragraph applies where the estimate or revised estimate of tax payable by a taxpayer with respect to chargeable income tax for a year of assessment under section 122 is less than ninety percent of the correct amount.

(2) Where this paragraph applies, the taxpayer is liable to pay interest on the tax due for the period, from the date the first instalment for the year of assessment is payable until the date by which the person files a return of income for the year of assessment under section 124.

(3) The amount of interest that a taxpayer shall pay for each period under subparagraph (2) is calculated as one hundred and twenty- five percent of the statutory rate, compounded monthly, and applied to the difference between

(a) ninety percent of the total amount that would have been paid by way of instalments during the year of assessment to the start of the period had the estimate of the person equalled the correct amount; and

(b) the amount of income tax paid by instalments during the year of assessment to the start of the period.

(4) For purposes of calculating interest payable under subparagraph (3), an extension granted under paragraph 21, 28 or 36 is to be ignored.

  1. Making false or misleading statements

(1) A person who

(a) makes a statement that is false or misleading in a material particular to an officer of the Authority; or

(b) omits from a statement made to an officer of the Authority, anything or matter without which the statement is misleading in a material particular is liable to pay a penalty,

(c) equal to double the underpayment of tax which may result if the inaccuracy of the statement were undetected, where the statement or omission is made without reasonable excuse; and

(d) triple the underpayment of tax which may result if the inaccuracy of the statement were undetected, where the statement or omission is made knowingly or recklessly.

(2) A reference in this paragraph to a statement made to an officer of the Authority is a reference to a statement made in writing to that officer acting in the performance of functions under this Act, and includes a statement made

(a) in an application, certificate, declaration, notification, return, objection, or other document made, prepared, given, filed, or furnished under this Act;

(b) in information required to be furnished under this Act;

(c) in a document furnished to an officer of the Authority otherwise than pursuant to this Act; and

(d) in answer to a question asked of a person by an officer of the Authority or to another person with the knowledge or reasonable expectation that the statement would be conveyed to an officer of the Authority,

  1. Aiding or abetting

A person who knowingly or recklessly aids or abets another person to commit any of the offences referred to under paragraph 48 to 52, or counsels or induces another person to commit that offence is liable to a penalty equal to triple the underpayment of tax which may result if the offence were committed and went unnoticed.

  1. Assessment of interest and penalties

(1) The Commissioner-General shall make an assessment of the interest and penalties for which a person is liable under paragraph 48 to 53.

(2) Liability for interest and penalties under paragraph 48 to 53 is calculated separately with respect to each paragraph under paragraph 48 to 53.

(3) The imposition of interest and penalties under paragraph 48 to 53,

(a) is in addition to any other tax imposed by this Act or fine imposed as a result of conviction of an offence under paragraph 55 to 60; and

(b) shall not relieve any person from liability to criminal proceedings in respect of that offence.

(3) Where an assessment has been made under this paragraph, the Commissioner-General shall serve a notice of assessment on that person stating

(a) the amount of interest or penalties payable;

(b) how the amount is calculated; and

(c) the time, place, and manner of objecting to the assessment.

(5) Interest and penalties assessed under this paragraph

(a) are due and payable within thirty days from the day on which the person liable is served with the notice of assessment under subparagraph (4); and

(b) are treated for the purposes of this Act as though they were tax.

Offences

  1. Failure to comply with this Act

(1) Except as otherwise provided in this Act, a person who contravenes a provision of this Act commits an offence and is liable on summary conviction,

(a) where the failure results, or may result if undetected, in an underpayment of tax in an amount of not less than two hundred currency points, to a fine of not less than two hundred penalty units and not more than four hundred penalty units; and

(b) in any other case, to a fine of not less than ten penalty units and not more than two hundred penalty units.

  1. Failure to pay tax

A person who without reasonable excuse fails to pay tax, including an amount treated by this Act as if it were tax, on or before the due date for payment commits an offence and is liable on summary conviction,

(a)  where the failure is to pay an amount in excess of two thousand currency points, to a fine of not less than two hundred penalty units and not more than one thousand penalty units or to a term of imprisonment of not less than three months and not more than one year, or to both the fine and imprisonment; and

(b) in any other case, to a fine of not less than fifty penalty units and not more than two hundred penalty units or to a term of imprisonment of not less than one month and not more than three months, or to both the fine and imprisonment.

  1. Making false or misleading statements

(1) A person who,

(a) makes a statement that is false or misleading in a material particular to an officer of the Authority, or

(b) omits from a statement made to an officer of the Authority, any matter or thing without which the statement is misleading in a material particular, commits an offence and is liable on summary conviction

(c) to a fine of double the amount of tax underpayment that may result, where the statement or omission is made without reasonable excuse, and the inaccuracy of the statement had gone undetected;

(d) to a fine of not less than: fifty penalty units and not more than two hundred penalty units or to a term of imprisonment of not less than one month and not more than three months, or both the fine and imprisonment, in any other case;

(e) to a fine of triple the amount of tax underpayment that may result where the statement or omission is made knowingly or recklessly and the inaccuracy of the statement had gone undetected; or

(f)  to a fine of not less than fifty penalty units and not more than two hundred penalty units or to a term of imprisonment of not less than six months and not more than one year, or both the fine and imprisonment, in any other case.

(2) A reference in this paragraph to a statement made to an officer of the Authority is a statement made in writing to that officer acting in the performance of functions under this Act and includes a statement made

(a) in an application, certificate, declaration, notification, return, objection or other documents made, prepared, given, filed or furnished under this Act;

(b) in information required to be furnished under this Act;

(c) in a document furnished to an officer of the Authority otherwise than pursuant to this Act;

(d) in an answer to a question asked of a person by an officer of the Authority or to another person with the knowledge or reasonable expectation that the statement would be conveyed to an officer of the Authority.

  1. Impeding tax administration

(1)  A person who without reasonable excuse,

(a) obstructs or attempts to obstruct an officer of the Authority in the performance of duties under this Act, or

(b) otherwise impedes or attempts to impede the administration of this Act, commits an offence and is liable on summary conviction to a fine of not less than one hundred penalty units and not more than one thousand penalty units or to a term of imprisonment of not less than six months and not more than two years, or to both the fine and imprisonment.

(2) In addition to the punishment under subparagraph (1), any goods used by the offender in the commission of the offence shall be forfeited.

(2) In this paragraph, “impeding administration of this Act" includes

(a) with respect to a tax officer, performing duties under this Act or a person assisting the tax officer

(i) assaulting, abusing, interfering with or obstructing the tax officer or assistant or attempting to do so;

(ii) interfering with an asset used by the tax officer or assistant or attempting to do so; or

(iii) refusing to grant access to a premises, place, document or other asset as required by paragraph 18;

(b) failing to comply with a notice under paragraph 19;

(c) falsely making or altering a document or a mark on the document with the intention that any person will wrongly believe or act on the basis that the document is correctly required by or issued under this Act or correctly stamped;

(d) with the intention of evading an obligation under this Act, knowingly dealing with or using a document or asset

(i) that is false or misleading in a material particular;

(ii) in a way that makes the document or asset false or misleading in a material particular; or

(iii) so that the document or asset contains or produces information, including by way of measurement, that is false or misleading in a material particular;

(e) evading tax or knowingly being concerned in or taking steps with a view to evading tax, including-

(i) accepting goods knowing or believing that tax due with respect to the goods has not and will not be paid or will be falsely reclaimed;

(ii) dealing with an asset charged under paragraph 42 80 a8 to prevent seizure;

(iii) dealing with an asset liable for seizure under this Act so as to prevent seizure:

(iv) dealing with an adhesive stamp that has been previously used;

(f) recovering tax, including recovering or rescuing an asset seized under paragraph 18, taking possession of charged assets under paragraph 42, taking possession of distrained asset under paragraph 41 or any other tax law;

(g) interfering with any lock, seal, mark, fastening or other security used to restrain an asset under paragraph 41;

(h) disguising, warning, hiding or rescuing a person with the intent that any liability, obligation or arrest of that person under this Act is evaded, disguised or hidden; and

(i) committing an offence under this Act where the person has already been convicted of an   offence under this Act or had an offence compounded under paragraph 62.

  1. Offences by authorised and unauthorised persons

(1) Any person who,

(a) being an officer or a person employed in carrying out the provisions of this Act,

(i) directly or indirectly asks for, or receives in connection with any of the duties of that officer or person, a payment or reward, whether pecuniary or otherwise, or promise or security for that payment or reward, not being a payment or reward which the officer is lawfully entitled to receive, or

(ii) enters into or acquiesces in an agreement to do or to abstain from doing, permit, conceal, or connive at any act or thing whereby the tax revenue is or may be defrauded or which is contrary to the provisions of this Act or to the proper execution of the duty of the officer, or

 (b) not being authorised under this Act, collects or attempts to collect an amount of tax levied under this Act or an amount which that person describes as tax, commits an offence and is liable on summary conviction to a fine of not less than fifty penalty units and not more than two hundred and fifty penalty units or to a term of imprisonment of not less than one year and not more than three years, or to both,

(2) A person who contravenes paragraph 20 commits an offence and is liable on summary conviction to a fine of not less than fifty penalty units and not more than one hundred penalty units or to a term of imprisonment of not less than six months and not more than one year, or to both.

  1. Aiding or abetting

A person who aids or abets another person to commit an offence, referred to as the “original offence", under this Act, or counsels or induces another person to commit that offence, commits an offence and is liable on summary conviction,

(a) where the original offence involves a statement of the kind mentioned in paragraph 57 and if the inaccuracy of the statement were undetected may result in an underpayment of tax in an amount more than one hundred currency points, to a fine of not less than fifty penalty units and not more than two hundred penalty units or to a term of imprisonment of not less than one year and not more than two years, or to both the fine and imprisonment; and

(b) in any other case, to a fine of not less than ten penalty units and not more than fifty penalty units or to a term of imprisonment of not less than six months and not more than one year, or both.

Entities

  1. Offences by entities

(1) Subject to subparagraph (3), where an entity commits an offence, every person who is a manager of that entity at that time is treated as also having committed the same offence.

(2) Subject to subparagraph (3), where an entity commits an offence by failing to pay an amount of tax, including an amount treated by this Act as though it were tax, every person who is a manager of that entity at that time or was a manager within the previous six months is jointly and severally liable with that entity and that other person to the Commissioner-General for the amount.

(3) Subparagraphs (1) and (2) do not apply where

(a) the offence is committed without the knowledge or consent of that person; and

(b) that person has exercised the degree of care, diligence and skill that a reasonably prudent person would have exercised in comparable circumstances to prevent the commission of the offence.

(4) A person who makes a payment to the Commissioner- General with respect to a liability under subparagraph (2),

(a) shall be indemnified by that entity with respect to the payment; and

(b) may retain out of any money or property of that entity coming into the possession of that person an amount not exceeding the payment.

(5) An entity under this paragraph shall not have a claim against that person with respect to retention of money or property under sub- subparagraph (a) of subparagraph (4).

                                                     Proceedings

  1. Compounding offences

(1) Where a person commits an offence under this Act, other than of a kind referred to in paragraph 59, the Commissioner-General may, at any time prior to the commencement of court proceedings, compound the offence and order that person to pay a sum of money specified by the Commissioner-General, not exceeding the amount of the fine prescribed for the offence.

(2)The Commissioner-General may only compound an offence under this paragraph if the person concerned admits in writing to the commission of the offence.

(3) Where the Commissioner-General compounds an offence under this paragraph, the order referred to in subparagraph (1),

(a) shall be in writing and specify the offence committed, the sum of money to be paid, and the due date for payment, and shall have attached the written admission referred to in subparagraph (2);

(b) shall be served on the person who committed the offence;

(c) shall be final and not subject to an appeal; and

(d) may be enforced in the same manner as a decree of a court for the payment of the amount stated in the order or by the provisions of this Act.

(4) Where the Commissioner-General compounds an offence under this paragraph, the person concerned is not liable for prosecution or a penalty under paragraph 55 to 60 in respect of that offence.

  1. Venue

Any

(a) offence committed by a person under this Act, or

(b) civil proceedings under this Act in relation to a person, shall be instituted, tried, heard, disposed of and the person punished, as the case requires, at the Court nearest to the usual place of residence of that person or at a Court exercising jurisdiction over the area in which the office of the Commissioner-General having primary responsibility for the affairs of that person under this Act is situated.

  1. Amounts payable notwithstanding

(1) The institution of proceedings for, or the imposition of, a penalty, fine or term of imprisonment under this Act shall not relieve a person from liability to pay a tax, including an amount treated by this Acct as though it were tax, for which that person is or may become liable under this Act.

(2) In proceedings under this Act, the production of a certificate signed by the Commissioner-General stating the name and address of the person liable and the amount of tax due or due and payable by that person shall be sufficient evidence of the amount of tax due or due and payable by that person.

Remission and refund

  1. Remission

(1) Where the Commissioner-General is of the opinion that the whole of a part of the tax which is due by a person, including an amount treated by this Act as though it were tax, cannot be effectively recovered by reason of

(a) considerations of poverty, or

(b) impossibility, undue difficulty, or the excessive cost of recovery, the Commissioner-General may remit in whole or in part the tax due by that person.

(2) Where good cause is shown by a person liable for interest or penalty under paragraph 48 to 53, the Commissioner-General may remit in whole or in part any interest or penalty charged under that Subdivision whether before or after any related proceedings for an offence under paragraph 55 to 60 are commenced or concluded.

(3) The Commissioner-General may, if satisfied that it is just and equitable to do so, remit in whole or in part a tax due by a person under this Act.

  1. Refunds and set-off

(1) Where the Commissioner-General is satisfied that tax has been paid by a person in excess of the tax liability of that person to which the payment relates, the Commissioner-General shall

(a) apply the overpaid tax in reduction of any amount due by that person in respect of

 (i) other taxes under this Act;

(ii) instalments of tax or withholding of tax under this Act: or

(iii ) any other amount due to the Authority under this Act: and

(b) refund the remainder to that person within three months of becoming satisfied.

(2) Interest or penalty paid by a person under paragraph 50 shall be refunded to that person to the extent that the tax to which the interest or penalty relates is found not to have been due and payable.

(3) Where the Commissioner-General is required to refund an amount of tax to a person as a result of a decision of a court under paragraph 22, the Commissioner-General shall pay interest at the prevailing bank rate, for the period commencing on the date that person paid the tax refunded and ending on the day on which the refund is made,

(4) Without limiting subparagraph (1), a person may apply for a refund under this paragraph and the application shall be made to the Commissioner-General in writing within six years of the later of

(a) the date on which the Commissioner-General has served the notice of assessment to which the refund application relates; or

(b) the date on which the tax or interest was paid.

(5) The Commissioner-General shall, within forty-five days of making a decision on a refund application under subparagraph (1) or (2), serve on the person applying for the refund a notice in writing of the decision.

(6) A person dissatisfied with a decision referred to in subparagraph (5) may only challenge the decision under the objection and appeal procedure in paragraph 21 as though the decision were an assessment.

(7)  For the purpose of this paragraph, refunds due under this Act shall be paid out of the Ghana Revenue Authority General Refund Account after certification by the Commissioner-General.

  1. Interpretation

In this Schedule, unless the context otherwise requires,

correct amount” means the actual income tax payable under this Act by the taxpayer, for the year of assessment; and

underpayment” is the amount of tax assessable with respect to the tax return less tax paid by the start of the period towards that amount.

 

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button
Close
Close