INCOME TAX
Corporate Tax: This is the tax paid by companies on their profits in the year. The tax rate is 25%.
Personal Income Tax: Self-employed persons are required to pay Income tax at graduated rates in four equal installments. The current Personal Income Tax rates took effect from November 2011.
Pay As You Earn (PAYE): The PAYE contributions are withholdings from salaries of employees in order to satisfy their income tax responsibilities. The PAYE is computed with the Personal Income Tax rates. (See box below)
ANNUAL TAX RATES – EFFECTIVE 23 MAY 2013
|
Chargeable Income (GH¢) |
Rate (%) |
Tax (GH¢) |
Cumulative Chargeable Income (GH¢) |
Cumulative Tax (GH¢) |
|
First 1,584 |
Free |
NIL |
1,584.00 |
NIL |
|
Next 792 |
5 |
39.60 |
2,376.00 |
39.60 |
|
Next 1,104 |
10 |
110.40 |
3,480.00 |
150.00 |
|
Next 28,200 |
17.5 |
4,935.00 |
31,680.00 |
5,085.00 |
|
Exceeding 31,680 |
25 |
|
|
|
MONTHLY TAX RATES
|
Chargeable Income (GH¢) |
Rate (%) |
Tax (GH¢) |
Cumulative Chargeable Income (GH¢) |
Cumulative Tax (GH¢) |
|
First 132 |
NIL |
NIL |
132.00 |
NIL |
|
Next 66 |
5 |
3.30 |
196.00 |
3.30 |
|
Next 92 |
10 |
9.20 |
290.00 |
12.50 |
|
Next 2,350 |
17.5 |
411.25 |
2,640.00 |
423.75 |
|
Exceeding 2,640 |
25 |
|
|
|
Vehicle Income Tax (VIT): This is a tax collected from commercial vehicle operators on quarterly basis.
- The VIT system makes it obligatory for commercial vehicle operators to buy VIT stickers from any GRA District office on a quarterly basis
- These stickers are in various categories and rate depending on the vehicle’s passenger capacity and type of operation e.g. taxis, trotros, tour buses, etc.
- The sticker must be pasted on the front windscreen
- Monitoring is done with the assistance of the Police Service
STAMP DUTY
Stamp duty is administered under the Stamp Duty Act, 2005 (Act 689). The Stamp Duty is not a tax on transactions, but on documents brought into being for the purposes of recording transactions. It is therefore a tax on documents or specific instruments which have legal effect.
CAPITAL GAINS TAX
This is a tax paid on the gains made from the realization or sale of a chargeable asset where the gain exceeds GH¢50.00. Assets on which tax is imposed include land, buildings, business assets including goodwill and shares of a resident company. The rate of tax is 15%.
MINERAL ROYALTIES
This is a tax imposed on persons for the extraction of natural resources on or under the surface of the earth. The rate is 5%.
VAT
Value Added Tax (VAT) is a broad-based tax imposed on the expenditure of consumers when they purchase goods and services. It is collected by businesses which are registered to charge the tax in stages on the “value added” from the manufacturing to retail level The businesses then account for the tax so collected at the end of every month. The current standard rate of the tax is 12½ percent. A zero (0) rate is also applied to all exports.
VAT Flat Rate Scheme (VFRS)
This is a special method for collecting and accounting for VAT/NHIL. It is designed for traders operating in the retail sector. Under the VFRS, registered retailers of taxable goods shall charge VAT/NHIL at a marginal rate of 3% on the value of each taxable item sold.
INFORMATION TAKEN DIRECTLY FROM THE GHANAIAN REVENUE AUTHORITY.
DISCLAIMER: The above information is an approximate guide to the the taxation in Ghana. The information may be subject to change.