Key Exemptions Highlighted by Dr. Ali-Nakyea in Ghana’s Withholding Tax System
In a virtual seminar hosted by the Ghana Association of Muslim Accountants (GAMA) and the Chartered Institute of Taxation, Ghana (CITG), Tax Expert Dr. Ali-Nakyea shed light on crucial nuances within Ghana’s withholding tax framework. Underlining four exemptions delineated in section 115(2), Dr. Ali-Nakyea navigated through intricacies such as PAYE, individual payments, interest to resident financial institutions, and those deemed exempt.
Noteworthy is the authority vested in the Commissioner-General (C-G) under section 116(5)(c) to grant exemptions, contingent on a compelling case or a track record of tax compliance. Institutions seeking reprieve must, in writing, present their case, showcasing just cause and maintaining satisfactory tax records.
The obligations of those enjoying exemptions in the realm of trading stock include a quarterly submission of particulars for payments that would have incurred withholding tax but for the exemption. Timeliness is paramount, with a stringent requirement for submission at the end of every calendar quarter.
In tandem with these provisions, the withholding agent plays a pivotal role. A meticulous schedule governs the payment and filing obligations, necessitating remittance within fifteen days post the relevant month. The prescribed withholding tax return, a cornerstone in this process, mandates comprehensive details, including payments made, withholdee specifics, and the corresponding tax withheld.
Failure on the part of the withholding agent to adhere to these regulations culminates in personal liability for the unwithheld tax amount, payable directly to the Commissioner-General.
The delineation of final withholding payments adds a layer of clarity, encompassing dividends, specific rent scenarios, payments to non-residents, and various professional fees.
This comprehensive framework as explained by Dr Ali-Nakyea paints a vivid picture of the withholding tax landscape in Ghana, echoing the nuanced interplay between exemptions, responsibilities, and procedural adherence.