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Tax administration
Home Level 3 3.3 Advanced Taxation Archive by Category "Tax administration"

Category: Tax administration

3.3 Advanced TaxationLevel 3REPORTTax administration

May 2020 Q5 a.

Mmabia University has written to a financial consultancy firm you work for requesting for a clarification in respect of the taxability or otherwise of its profits. The Financial Controller Bubu Moon signed the letter. It indicated that per the University’s understanding, Mmabia is not liable to tax as Government has amended the laws exempting private universities from payment of taxes.

The Financial Controller indicated in his letter that the response from your firm would be shared with other universities to take note also.

The Manager in charge of tax has invited you as his team member to respond to this request for clarification on the matter as expressed by Mmabia University to help clarify the matter better.

Required:
Write a response on the clarification setting straight the tax provision on the matter and also, comment on the decision to share the response with other universities.            (10 marks)

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Hope Firm
Box 22
Accra
Date

FINANCIAL CONTROLLER
MMABIA UNIVERSITY
ACCRA
Sir,
REQUEST FOR CLARIFICATION ON THE TAX STATUS OF PRIVATE UNIVERSITY

  • Introduction
    Reference your letter on the above issue dated 12th June, 2019, I furnish below the tax implication of profit made by privately-owned universities.
  • Issue
    The tax provisions (Act 2017, Act 956) state that privately-owned universities shall be exempt from tax when they plough back a hundred percent of their profit-after tax into the business
  • Implication of the provision
    With the way the law is crafted, it requires the Privately-owned universities to pay the taxes unless they are able to provide proof of ploughing back their profits.
  • Sharing information with others
    Our clarification is in response to your request and it shall not be shared with others.
  • Conclusion
    On the strength of the above, it is our hope that your company shall act accordingly so as to remain in compliance with the tax laws.            Thanks

Jojo Small                                                                                                  (5 points @ 2 marks each = 10 marks)

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3.3 Advanced TaxationLevel 3Tax administration

Nov 2019 Q5 a&b

a) During the tax audit of Kalybos Company Ltd, a lot of information came to the attention of the Ghana Revenue Authority staff who conducted the audit. The staff reminded themselves that a person employed, or engaged by Ghana Revenue Authority must be confidential.
Required:
i) Under what circumstances would a person or the Commissioner-General disclose information or documents to another person?                                                                                                                                                                                 (3 marks)

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  • The other person is currently employed or engaged by the GRA or assisting the GRA in the performance of a function.
  • The disclosure is for the purposes of tax administration or any other tax law.
  • The Commissioner-General has authorised the disclosure.
  • The Commissioner-General is to disclose information or documents according to a court or tribunal order for the purpose of a tax law.                                (Any 3 points)

ii) Which categories of persons or institutions may the Commissioner-General disclose a taxpayer’s information to?    (2 marks)

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  • The Minister of Finance.
  • A person in the service of the Government in a revenue or statistical department where the disclosure is necessary for the performance of the official duties of the person.
  • The Auditor-General or a person authorised by the Auditor-General where the disclosure is necessary for the performance of official duties.
  • The competent authority of the government of another country with which Ghana has entered into an international arrangement, to the extent permitted under that arrangement.          (Any 2 points)

b) During the tax audit of Kalybos Ltd, the Commissioner-General sought the assistance of some Lawyers and Architects who were not employees of Ghana Revenue Authority. The Management of Kalybos Ltd is protesting the use of these experts whose advice influenced the final decisions of the Commissioner-General.
Required:
What are the rules governing the assistance of experts in the duties of the Commissioner-General of the Ghana Revenue Authority?                                                                                                                                                                            (5 marks)

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  • The Commissioner-General may engage experts, on the terms and conditions that the Commissioner-General considers necessary, to assist the GRA in the proper performance of the functions of the GRA. The appointment of an expert is ineffective unless the appointment is in writing and is expressly made.
  • An expert assisting the GRA to perform a function is to be supervised by the Commissioner-General or an Officer authorised by the Commissioner-General.
  • A taxpayer, however may refuse to deal directly with an expert but that person is not to obstruct an expert assisting a tax officer to perform a function.
  • A taxpayer may report to the Commissioner-General where that person is of the opinion that the engagement of a particular expert involves a conflict of interest.
  • Where the Commissioner-General receives a report that there is a conflict of interest with respect to an expert, the Commissioner-General is required to take a decision and the decision of the Commissioner- General on the matter is final.
    (5 points for 5 marks)

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