Documenti di Didattica
Documenti di Professioni
Documenti di Cultura
taxation
2019 Ghana Tax Facts and Figures
August 2019
www.pwc.com/gh
Introduction
PwC
A brief profile of PwC
About us – Global
overview
PwC firms provide industry-focused achieve this growth. We strive to deliver
assurance, tax and advisory services what we promise, work together as a
to enhance value for our clients. We team, and become a more purpose-led
are a network of firms in 158 countries and values-driven firm.
with more than 250,000 people who
are committed to delivering quality in In Africa, PwC is the largest provider
assurance, advisory and tax services. of professional services, with close to
Tell us what matters to you and find 400 partners and over 9,000 people
out more by visiting us at located in 34 countries. This enables
www.pwc.com/gh us to provide clients with seamless and
consistent service, wherever they are
Our global values located on the continent.
Navigating taxation
PwC Ghana, which is located in Accra George O Kwatia
and Takoradi with a branch office in Tax Leader
Sierra Leone, has over 300 employees george.kwatia@pwc.com
and 13 resident partners/directors. We
offer professional services to both the Eric Nipah
private and public sectors in Ghana in Advisory Leader
the following industries: eric.nipah@pwc.com
PwC
Table of contents
Navigating taxation
Direct taxation 2 Income attributable to a permanent
Income liable to tax 2 establishment 12
Resident persons 2 Branch profit tax 12
Income sources 2 Relief from double taxation 12
Taxation of individuals 3 Double tax treaties 12
Monthly tax rates 3 Treaty tax rates 13
Income from employment 3 Withholding tax under domestic tax laws 14
Personal relief 3 Exempt income 15
Contributions to retirement benefit Anti-avoidance schemes – Income
schemes 3 splitting 15
Interest incurred by an individual on Transfer pricing 15
residential premises 4 Thin capitalisation 16
Non-cash benefits 4 Administrative procedures –
Taxation of loan benefits 5 Furnishing of returns of income 16
Non-taxable benefits/income 5 Cases where a return is not required 16
Taxation of overtime and bonus 5 Statement of estimated tax payable 16
Payment to temporary and casual Payment of tax 16
workers 5 Offences and penalties 17
Pay-as-you-earn 6
Employer returns 6 Indirect taxation 18
Modified taxation 6 Value Added Tax, National Health
Year of assessment (individuals and Insurance Levy and Ghana Education
partnerships) 6 Trust Fund Levy 18
Corporate tax 7 Scope 18
Rates of tax 7 Standard (invoice credit) scheme 19
Year of assessment (companies) 7 Group registration 19
Basis period 7 Tax representative 19
Deductions allowed 7 Exempt supplies 19
Deductions not allowed 7 VAT, NHIL and GETFL incurred 20
Capital allowances 8 VAT flat rate scheme 20
Carry-over of tax losses 8 Withholding of VAT 20
Mineral royalties 9 Returns 20
Ring-fencing of financial institutions, Refunds 20
petroleum and mineral operations 9 Penalties 21
Dividends 9 Fiscal Electronic Devices 21
National Fiscal Stabilisation Levy 9 Communication service tax 21
Free-zone developers/enterprises 9 Special petroleum tax 22
Young entrepreneurs 9 Customs and excise taxes 23
Private universities 10 Import duties 23
Taxation of gifts 10 Special import levy 23
Realisation of assets and liabilities 10 African Union import levy 23
Telecommunications and transportation ECOWAS levy 23
business 10 Export and Import Levy (EXIM) 24
Change in control 10 Import duty exemptions 24
Taxation of banking business 10 Administrative charges 24
Taxation of insurance companies – Advance Eco levy 24
General business 11 Export duties 24
Withholding tax on premium payments 11 Excise duties 24
Life insurance business 11 Excise tax stamp 24
Taxation of retirement funds 11 Environmental tax 24
Payments sourced from Ghana 11 Airport tax 24
PwC
Direct taxation
2 | Navigating taxation
Taxation of individuals
Monthly tax rates
PwC | 3
The general mandatory monthly
contribution rates are as follows: Interest incurred by an
individual on residential
• For employers: 13% of the employee’s premises
salary; and
Mortgage interest incurred by an
• For employees: 5.5% of the individual on a loan employed in the
employee’s salary. construction or acquisition of one
residential premises may be claimed as
The employer is responsible for remitting a deduction against the income of that
the total mandatory contributions within individual.
14 days from the end of the month in
which the deduction is expected to
have been made. The contributions Non-cash benefits
are remitted to the Social Security and
National Insurance Trust (SSNIT) and an Except where specifically exempt or
approved trustee, as appropriate. otherwise stated, non-cash benefits
received from employment are
Exemption from tax is available for recognised at market value and taxed.
contributions made to the mandatory
and voluntary schemes. Accommodation facilities and vehicle-
related benefits are specifically provided
for and valued as follows:
4 | Navigating taxation
• Redundancy pay;
Taxation of loan benefits
• Pension;
Interest on concessionary loans granted
by an employer to an employee may be • Capital sum paid to a person as
deemed as taxable benefit. compensation or gratuity for personal
injury suffered by that person or
because of the death of another
Non-taxable benefits/income person;
PwC | 5
Pay-as-you-earn
Employer returns
Modified taxation
Year of assessment
(individuals and partnerships)
6 | Navigating taxation
Corporate tax
Rates of tax Deductions allowed
PwC | 7
Capital allowances
Capital allowances are granted to persons who own depreciable assets and use
those assets to produce income from business.
Capital allowances granted to a person are to be taken in the year granted and
cannot be deferred. Depreciable assets are grouped in the following classes for the
purpose of capital allowances:
Tax losses can be carried forward for three or five years depending on the industry/
sector of operation.
8 | Navigating taxation
The affected companies and institutions
Mineral royalties are:
• Breweries;
Ring-fencing of financial
institutions, petroleum and • Inspection and valuation companies;
mineral operations • Companies providing mining support
services;
The chargeable income of financial
institutions, petroleum or mineral • Shipping lines; and
operations is calculated separately for • Maritime and airport terminal
each financial service, petroleum right or operators.
mineral operation.
Free-zone developers/
Dividends
enterprises
Generally, unless exempt or subject to
Companies registered to operate as
a double tax treaty, dividends paid by a
free-zone developers/enterprises enjoy
resident company are subject to a final
a ten-year income tax holiday. Once the
withholding tax of 8%.
ten-year tax holiday has expired, the tax
rate on the export of goods and services
National Fiscal Stabilisation is 15%. Any other income is taxed
Levy at 25%.
10 | Navigating taxation
Taxation of insurance Life insurance business
companies – General business
A person engaged in a life insurance
The business of a general insurance business is required to determine
company is taxed on premiums and income from the life insurance business
proceeds derived and any reserve for separately from any other business
unexpired risk deducted in the previous activity.
period, less:
The business of a life insurance
• proceeds incurred; company is taxed as follows:
Premiums paid to a non-resident person The following are some of the payments
for insurance with a source in Ghana considered as having been sourced from
attract a 5% withholding tax. Ghana:
PwC | 11
• Payments made in respect of natural The income of a Ghanaian permanent
resources located in Ghana; establishment is subject to tax in the
same manner as a resident company.
• Rent paid for the use of, right to use,
or forbearance from using an asset The foreign income of a foreign
situated in Ghana; permanent establishment is exempt
• Royalties paid for the use of, right to from tax in Ghana.
use, or forbearance from using an
asset in Ghana;
Branch profit tax
• Premiums and proceeds for general
insurance paid to cover risk in Ghana; The net profit of a branch is deemed as
repatriated profits and attracts a final
• Payment in respect of acquiring withholding tax of 8%.
a domestic asset or incurring a
domestic liability or the realisation of
that asset or liability; Relief from double taxation
• Payment made in respect of an A resident person (excluding a
activity conducted or forbearance partnership) is allowed to claim foreign
from conducting an activity in Ghana; tax credit for any income tax they pay to
• Payments for employment or services a foreign country in respect of a foreign-
rendered in Ghana, regardless of sourced income to the extent that the
the place of payment; or paid by the foreign-sourced income is included in
Government, regardless of the place the assessable income of that person.
of performance; and
12 | Navigating taxation
Treaty tax rates
Tax rates applicable under the terms of these treaties are as follows:
PwC | 13
Withholding tax under domestic tax laws
Income Rate %
Resident persons
Dividends 8
Non-resident persons
Dividends 8
14 | Navigating taxation
A withholding agent is required to • Income of an approved unit trust or
prepare and provide the withholdee mutual fund; and
with a withholding tax certificate within
30 days of the month of deduction. • Income of an approved real estate
investment trust.
Exempt income
Anti-avoidance schemes –
The following types of income are Income splitting
exempt from taxes:
Income splitting includes transfers of
• Gain from life insurance when the income or assets (including money) to
proceeds are paid by a resident an associate that result in the transferee
insurer; receiving or enjoying the income from
that property in order to reduce the
• The income of a non-resident person combined tax liability of the transferor
from a business that operates ships and transferee. Income splitting is not
or aircraft, if the Commissioner- permitted under the laws of Ghana.
General is satisfied that an equivalent
exemption is granted by that person’s
country of residence to persons Transfer pricing
resident in Ghana;
Ghana’s Transfer Pricing Regulations
• A dividend paid to a resident (TPRs) require that transactions
company by another resident conducted between persons who are
company when the company in a controlled relationship (e.g. parent-
receiving the dividend controls at subsidiary, associates, relatives, etc.)
least 25% of the voting power in the be done at arm’s length. The TPRs also
company paying the dividend. This cover transactions between an employer
exemption does not apply to certain and employee.
special industries;
PwC | 15
At the end of the year, taxpayers
who conducted business with other Cases where a return is not
persons with whom they have controlled required
relationships are required to:
Unless the Commissioner-General
• complete and file annual transfer requests so in writing, a return shall not
pricing returns; and be filed by:
16 | Navigating taxation
Offences and penalties
PwC | 17
Indirect taxation
Scope
In Ghana, Value Added Tax (‘VAT’), The liability for VAT, NHIL and GETFL is
National Health Insurance Levy (‘NHIL’) in the case of:
and Ghana Education Trust Fund Levy
(‘GETFL’) are charged on any supply of • a taxable supply, by the taxable
goods and services that is a taxable person making the supply;
supply and is made by a taxable person • imported goods, by the importer;
in the course of its taxable activity.
• an imported service, by the receiver
A taxable activity means an activity, of the service under certain
whether or not for a pecuniary profit, conditions; and
carried on by a person in Ghana or
partly in Ghana that involves the supply • the supply of telecommunication
of goods or services to another person services or electronic commerce for
for consideration. use in Ghana, by the non-resident
person making the supply or its
Except for exempt goods and services, agent.
VAT, NHIL and GETFL are generally
charged on the following: Except for supplies considered to be
zero-rated or subject to a flat rate of 3%
• the supply of goods and services (for wholesalers and retailers of goods),
made in Ghana; and the standard rate of VAT is 12.5%, the
NHIL is 2.5% and the GETFL is 2.5%.
• imports of goods and services.
NHIL and GETFL are calculated on the
value of the taxable supply of the goods,
services or imports, with VAT charged
on the value of the taxable supply
inclusive of NHIL and GETFL.
18 | Navigating taxation
A taxable person is a person who is
registrable for VAT and/or who has Exempt supplies
been registered by the Commissioner-
General and issued with a certificate Some supplies that are specifically
of registration. The effective date of exempt are listed below:
registration as a taxable person is
the date specified on the certificate • Agricultural inputs;
of registration, or, in the case of • Water, excluding bottled or packaged
persons who are registrable but not yet water;
registered for VAT, from the beginning
of the tax period immediately following • Electricity within specified limits;
the tax period in which the obligation to
register arose. • Textbooks, approved supplementary
readers, newspapers, atlases, charts,
maps and music;
Standard (invoice credit)
• Education services, and laboratory
scheme and library equipment for use in
rendering such services;
The general mandatory registration
turnover threshold for taxable supplies • Medical services and medical
over a 12-month period is GH¢200,000. supplies;
• Domestic transportation;
Group registration is possible but
subject to approval of a written • Machinery and parts of machinery
application by members of the proposed designed for use in certain activities;
group of businesses.
• Crude oil and hydrocarbon products;
PwC | 19
VAT, NHIL and GETFL incurred Returns
There is a flat rate scheme (3% VAT) VAT, NHIL and GETFL returns and
applicable to taxable supplies made by payment (if any) are ordinarily due by the
wholesalers and retailers in the course last working day of the month after the
of their taxable activity. The scheme month to which the returns relate.
does not cover manufacturers and
service providers and does not cover VAT, NHIL and GETFL on imported
the supply of any form of power, heat, goods are paid when the associated
refrigeration or ventilation. All other VAT duties are paid. The return and payment
provisions apply to the flat rate scheme, of VAT, NHIL and GETFL on imported
except for the right to deduct input services are due within 21 days of the
tax. The provisions of the NHIL and the month following the month in which the
GETFL do not, however, apply to the services were imported.
scheme.
VAT withholding returns are filed by the
15th day of the following month to which
Withholding of VAT the returns relate and tax withheld is
paid by the due date.
The Commissioner-General has
appointed some persons as VAT
withholding agents. These agents are Refunds
required to withhold from payments
for standard rated supplies, 7% of the Businesses can apply for VAT refunds
taxable output value for VAT purposes, in accordance with the provisions of the
i.e. the taxable value inclusive of NHIL relevant VAT legislation. Refund claims
and GETFL, and issue a Withholding VAT must satisfy relevant conditions.
Credit Certificate at the time of payment.
20 | Navigating taxation
Penalties
Some monetary penalties resulting from non-compliance are given in the table
below:
Offence Sanctions
Failure to register Up to twice the amount of tax on taxable supplies
until the application is filed
Failure to issue (proper) tax Up to GH¢ 1,200, plus the higher of GH¢ 500 and
invoices triple the amount of tax
Late filing of VAT return GH¢ 500 plus an additional GH¢ 10 per day
Making a claim for a refund Twice the original refund request, plus interest
which you are not entitled to
Late payment of tax 125% of the Bank of Ghana monetary policy rate,
compounded monthly, and applied to the amount
outstanding
PwC | 21
Users of ECS include individuals and If an extension approval has not been
corporate entities, as well as the ECS granted by the Commissioner-General
providers themselves. of the GRA, interest at 125% of the
statutory rate is imposed on CST that is
The rate of CST is 9% and this is not remitted to the GRA by the due date.
chargeable on ECS and recharges
made by ECS providers. Charges for
ECS include those made for monetary Special petroleum tax
and non-monetary consideration (e.g.
promotions and bonuses). CST is also Persons licensed to operate as oil
applicable to interconnection services. marketing companies are required
to charge a Special Petroleum Tax at
ECS providers in Ghana are ordinarily specific rates per litre or kilogram on the
required to collect tax and account to following petroleum products:
the GRA on a monthly basis.
• petrol;
The due date for filing this monthly • diesel;
return is the last working day of the
month following the month to which the • liquefied petroleum gas;
tax return and payment relate, unless
the Commissioner-General directs • natural petroleum gas; and
otherwise. • kerosene.
If a CST return is not filed by the due The tax is administered by the GRA and
date without justification, a penalty of should be remitted by the last working
GH¢2,000 applies, with an additional day of the month following the month of
penalty of GH¢500 for each day the transaction.
return is not submitted.
22 | Navigating taxation
Customs and excise taxes
Import duties
Navigating taxation
PwC Ghana (www.pwc.com/gh) provides industry-focused assurance,
tax and advisory services to build public trust and enhance value for its
clients and their stakeholders. Over 250,000 people in 158 countries
across our network share their thinking, experience and solutions to
develop fresh perspectives and practical advice.
© 2019 PwC. All rights reserved. ‘PwC’ refers to the network of
member firms of PwC International Limited, each of which is a
separate and independent legal entity.
(19-23654)
www.pwc.com/gh