In 2016, two laws were passed by the parliament of ghana which involved the tax profession. This is the tax paid by companies on their profits in the year. A distribution of a resident trust is exempt from taxation if the distribution is in the hands of the beneficiary of the trust. The ghana revenue authority gra has held a stakeholders forum to help clarify some misconceptions about the new income tax law. Over the past two decades, the government has consistently spent more revenue than it. Passed by parliament and assented to by the president. Exemptions general taxation of trusts has been specifically provided for in the new act. Act 902 amends some provisions in act 896 the principal act. The forum created a platform for tax consultants, tax professionals, accountants, ministry of finance and others in the businesses community, to deliberate on the new law to enhance understanding.
Jan 11, 2016 the ghana revenue authority gra has held a stakeholders forum to help clarify some misconceptions about the new income tax law. A resident person is entitled to claim foreign tax credit for a year of assessment in respect of tax paid by that person to a foreign country on foreign income assessable to tax in ghana. The regulations, which came into force on 4 july 2016, amplify the provisions in the act. The new tax, act 896, 2015, which was made known yesterday, is to remove the narrow and distorted tax base of the old act. New income tax law from january 2016 graphic online. The act consolidates existing income tax laws into a simpler and user friendly form. The irs is working on implementing the tax cuts and jobs act tcja.
We assist individuals and businesses having taxrelated difficulties at no cost. Taxable profits are based on profits declared in audited accounts subject to adjustments made for capital allowances. Public lecture institute of chartered accountants of ghana. There are four main components of taxes in ghana, namely, taxes on income and. Whats new for your business provides information about changes to deductions, depreciation, expensing, credits, fringe benefits and other items that may affect your business. End of service benefit therefore constitutes ones gain from employment and as such is subject to tax in ghana.
Simplify the income tax law provisions and make it user friendly address various forms of tax base erosions on employment income, gift tax and interest paid on residential mortgages 30 november 2015 global tax alert ghana enacts new income tax act ey global tax alert library access both online and pdf versions of all ey global tax alerts. Ghana revenue authority launches new income tax law. Regulations are made after laws acts are passed mainly to provide clarity to these acts. Ghanas tax reforms constitute the major policy instrument needed to accelerate growth and poverty reduction. Effective 01 july 2007, the currency of ghana the cedi was redenominated to ghana cedi gh. A capital allowance granted to a person is deducted from the chargeable income or the loss to be carried forward in accordance with the act. Important changes which were made in the new income tax rates in ghana included the following. It is intended to improve tax compliance and administration and broaden the countrys income tax base by rationalizing tax breaks. Neither the ghana tax laws nor the gra define a tax dispute. Paying taxes in ghana and tax reforms graphic online. The 2015 income tax act ghana law act 896 was amended in 19 february 2016.
Nov 02, 2016 ghana has amended the 1962 law on registeration of companies in july 2016 the companies act 1962, and the amended law includes a clause on beneficial ownership. Ghana tax rate for 2016 2017, 2015 2016, 20142015 ghana income tax for 2016 w. Feb 06, 2017 in 2016, two laws were passed by the parliament of ghana which involved the tax profession. Regent universitys properties up for auction over gh. The ghana revenue authority gra has outdoored a new tax law, income tax act 2015 act 896 in accra. Gra practice notes to income tax act, 2015 act 896, ghana. Provide for new rates of tax on the chargeable income of resident individuals for a year of assessment introduce the withholding tax rate applicable to fees payable to an. We assist individuals and businesses having tax related difficulties at no cost. Platforms for calculating paye, vatnhil and withholding taxes have been made available for free usage. The new income tax law also seeks to widen the countrys tax base and consolidate the various income tax.
New income tax act 2015 ministry of finance issues clarification on 7 january 2016, the ministry of finance mof issued a press release clarifying certain provisions of the new income tax act 2015 the act as follows. Ghana investment promotion centre act 20, act 865 technology transfer regulations, 1992, li 1547 transfer pricing regulations, 2012 l. Amendments to the income tax act, 2015 act 896 the commissionergeneral of the ghana revenue authority gra wishes to inform the general public that the following amendments have been made to the income tax act, 2015 act 896 by the income tax amendment act, 2019 act 1007. Ghana revenue authority launches new income tax law latest news. This major tax legislation will affect individuals, businesses, tax.
We are a group of individuals from different industries and with expertise in ghana tax laws. A number of significant changes have been introduced under the income tax act targeted at curbing tax base erosion and. In accordance with the income tax act, 2015 act 896 a persons income from an employment is all of that persons gains and profit from that employment unless it is specifically exempted by the tax laws. Gra practice notes to income tax act, 2015 act 896.
The act provided new regulations on how income tax was to be imposed to ghanaians citizen. New income tax legislation known as the income tax act, 2015 act 896 went into effect on january 1, 2016. For more information on the tax rates in 2011 visit website. Technical paper feasibility of taxbenefit microsimulation in ghana. A look at income tax regulations 2016 business world ghana. Ghana s tax reforms constitute the major policy instrument needed to accelerate growth and poverty reduction. The chartered institute of taxation ghana has been operating as a professional body.
The minerals and mining act, 2006 act 703 as amended by the. A new look at income taxation in ghana ghana 2016 oxford. These regulations are the income tax regulations, 2016 l. Value added tax act, 20 act 870 excise duty act, 2014 act 878 customs act, 2015 act 891. Ghana revenue authority clarifies new income tax law. The government of ghana in its 2018 budget statement and. The ghana revenue authority gra has launched a new income tax law to replace the internal revenue act. Students guide to incometax including service taxvat. The chartered institute of taxation ghana was incorporated on 10th august 2016, by the chartered institite of taxation act 2016, act 916 to promote the study of taxation and regulate the practice of taxation in ghana. It is however clear from the wording of paragraph 211 of the seventh schedule of the income tax act. The income tax amendment act, 2015 act 902, was assented to by ghanas president and published in the official gazette on 30 december 2015.
Following the passage of the income tax act, 2015, act 896 as amended the act in 2015, ghanas finance minister has issued the income tax regulations, 2016, l. The companies act, 1963 act 179 income tax act, 2015 act 896 fisheries act, 2002 act 625. Revenue administration act, 2016 act 915 tax amnesty act, 2017 act 955 tax guide. Ghana tax legislation updated to reflect new realities. General news in ghana, politics, health, crime and more.
In ghana, the law requires all income earners to fill their taxes three months after the fiscal year. Passing the revenue administration bill, which is expected to harmonise and consolidate all tax administration provisions in ghanas various tax laws. Ghana tax rate for 20162017, 20152016, 20142015 ghana income tax for 2016 w. Later, the revenue administration act, 2016 act 915 was passed on 28 june 2016. Ghana pkf assurance, audit, tax, advisory and business. Ghana has amended the 1962 law on registeration of companies in july 2016 the companies act 1962, and the amended law includes a clause on beneficial ownership.
Vat regulations in ghana tax consulting firm in ghana. Ghana tax rates for 20162017, 20152016, 20142015 ghana. Income tax act, 2015 act 896 income tax amendment act, 2015 act 902 income tax amendment act, 2016 act 907 income tax regulations, 2016 l. Residents were subject to tax on income accruing in, derived from, brought into or received in ghana. This alert highlights some of the key changes introduced by the income tax regulations, 2016.
The vat registered taxpayer who is making supplies and has suffered withholding vat would continue to file their vat returns and account for vat in accordance with the provisions of the vat act,20 act 870 to the ghana revenue authority which is by the last working day of the month immediately following the month to which the return relates. Companies operating in ghana are liable to pay varied levels of taxes depending on the sector of operation, and the location of the project and whether the company is listed on the ghana stock exchange. Income tax rates applicable to resident individuals are. Recently, three regulations were made to provide clarity to three different tax laws. These laws contain provisions that seek to regulate the. Implementing the second phase of the national single window project to. End of service benefit therefore constitutes ones gain from employment and as. Mining laws and regulations ghana covers common issues in mining laws and regulations including the mechanics of acquisition of rights, foreign ownership and indigenous ownership requirements and restrictions, processing, beneficiation in 28 jurisdictions. Below is a summary of tax policies intended to be implemented by the government of ghana in 2019 as.
Income tax act, 2015 8 act 896 act of the parliament of the republic of ghana entitled income tax act, 2015 an act to provide for the imposition of income tax and for related purposes. The new public financial management act, 2016 pfma act. Occupational and personal pensions scheme general regulations 2011, l. The income tax act, 2015 act 896 comes into effect on 1st january 2016 to. The act also covers taxation of operations in industries such as petroleum, minerals and mining, and financial services. For more information on the tax rates visit website. Ghana amends company law, to establish register for. Note that despite changes made in the tax laws in 201220 and 2015 which affected ghanas rankings, other factors may account for ghanas. Part i imposition of income tax imposition of income tax 1.
This comes after the leadership of the country have come under some pressure, and following news of the leak of the panama papers and the ripples and the global call by anti. Tax rates, in the table below, are shown for purposes of effecting monthly deductions. The employer is required to withhold the employees taxes and pay to the ghana revenue authority gra. A company is resident for tax purposes if that company. Ghanas parliament has enacted new income tax legislation with an effective date of september 1, 2015. The chargeable income of a person for any year of assessment is the total of that persons income for the year from each business, employment, and investment less the total amount of deductions allowed to that person. The ghana revenue authority gra will implement a new income tax law to replace the repealed internal revenue act, act 592 with effect from january 2016.
The new legislation, the income tax act, 2015 act 896, replaces the internal revenue act, 2000 act 592 as the primary legislation on income tax in ghana. Income liable to tax 8 taxation of individuals 8 corporate tax 8 indirect taxation 23 scope24 standard invoice credit scheme 24 vat flat rate scheme 24 group registration 24 tax representative 24 exempt supplies 25 vat and nhil incurred 25 withholding of vat 25 returns 25 penalties 26 communication service tax 26 special petroleum tax 26. The tax law covers operations in all industries, including petroleum, minerals and mining, and financial services, among others. Ghana revenue authority clarifies new income tax law ghana.
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