• Where a person who is the owner of land or buildings situated in Ghana fails to pay tax when it is due and payable, the Commissioner-General may, by notice in writing, notify that person of the intention to apply to the Chief Registrar of Lands, for the land or buildings to be the subject of security for tax as specified in the notice.
• If a person on whom a notice has been served as above fails to make payment of the whole of the amount of the tax specified in the notice within thirty days of the date of service of the notice, the Commissioner-General may, by notice in writing, referred to as a “notice of direction”, direct the Chief Registrar that the land or buildings of that person, to the extent of the interest of that person in the land or buildings, be the subject of security for unpaid tax in the amount specified in the notice.
• Where a notice of direction is served on the Chief Registrar, the Chief Registrar shall, without fee, register the direction as if it were an instrument or mortgage over, or charge on, the land or buildings and the registration shall, subject to any prior mortgage or charge, operate in all respects as a legal mortgage over or charge on the land or building to secure the amount of the unpaid tax.
• Upon receipt of the whole of the amount of tax secured under the landed property for tax unpaid, the Commissioner-General shall serve notice on the Chief Registrar cancelling the notice of direction and the Chief Registrar shall, without fee, record the cancellation at which time the direction shall cease to have effect.
  

Where a person, referred to as the “tax debtor”, has not paid tax which is due, the Commissioner-General may, by notice in writing, require any other person:

• Owing or who may owe money to the tax debtor,
• Holding or who may subsequently hold money for, or on account of, the tax debtor,
• Holding or who may subsequently hold money on account of a third person for payment to the tax debtor, or
• Having authority from a third person to pay money to the tax debtor, to pay the money to the Commissioner-General on the date set out in the notice, up to the amount of tax due.
• The Commissioner-General may only issue a notice as indicated above with respect to tax which is due but not currently payable where the Commissioner-General reasonably believes that the tax debtor will not pay the tax by the date on which it becomes payable.
• The date specified in the notice given above shall not be a date before the money becomes due to the tax debtor, or is held on behalf of the tax debtor.
• At the same time that notice is served as above, the Commissioner-General shall also serve a copy of the notice on the tax debtor.
• Where a person served with a notice as above is unable to comply with the notice by reason of lack of moneys owing to or held for the tax debtor, that person shall, as soon as is practicable and in any event not later than the payment date specified in the notice, notify the Commissioner-General accordingly in writing setting out the reasons for the inability to comply.
• Where a notice is served on the Commissioner-General from the person owing the tax payer, the Commissioner-General may, by notice in writing,
• Accept the notification and cancel or amend the notice issued or
• Reject the notification.
• A person dissatisfied with a decision above may only challenge the decision under the objection and appeal procedure.
• A person making a payment pursuant to a notice from the Commissioner is deemed to have been acting under the authority of the tax debtor and of all other persons concerned and is hereby indemnified in respect of the payment against all proceedings, civil or criminal, and all processes, judicial or extra-judicial, notwithstanding any provisions to the contrary in any written law, contract, or agreement.             (Any 5 points)
  

There are two main types of taxes: direct taxes and indirect taxes. A tax cut increases disposable income, and leads to added consumption spending. Income will increase by a multiple of the decrease in taxes.
Taxation has been an important policy field throughout history and will stay a crucial aspect in future politics since it creates the basis for the state to work.
The following are some goals of taxation;

• The primary function of a tax system is to raise revenue for the government for its public expenditure. So the first goal in the development strategy as regards taxation policy is to ensure that this function is discharged adequately
• Taxes are used to reduce inequalities through a policy of redistribution of income and wealth. Higher rates of income taxes, capital transfer taxes and wealth taxes are some means adopted for achieving these ends.
• For social proposes such as discouraging certain activities which are considered undesirable. The excise taxes on liquor and tobacco, the special excise duties on luxury goods, betting and Gaming Levy are examples of such taxes, which apart from being lucrative revenue sources have also goals.
• Tax factors that affect development and growth.
• Taxes affect growth in two ways. First, by influencing the aggregate supply of the main factors of production by raising or lowering their net (after tax) returns; and
  Second, by influencing the efficiency of resource utilisation factor (total productivity).

• Effects on Production
  Public debts are raised to finance productive enterprises of various kinds, e.g., steel works, cement, multipurpose projects, construction of ships, railway lines and highways, heavy electrical and engineering works, mining, oil refining,
• Effects on Consumption
  When people subscribe to government loans, they generally have to curtail consumption. Since investment of funds raised by borrowing raises the level of employment and as a result raises the level of consumption.
• Effects on Distribution of wealth
  Public loans transfer money from rich to government. The fiscal operations of the government are to benefit the poor primarily. The incomes of the poor increase directly through increased employment or it benefit them in directly through the enlargement of social services.
• Effects on the Level of Income and Employment
  In modern times, public borrowing is resorted to in order to raise funds for financing agriculture, industry, mining, transportation, communication, etc. It increases employment opportunities, the level of income and standard of living.

A supply is said to have taken place on the earliest of the occurrence of any one of the following events:

• The goods are removed from the taxable person’s premises;
• Where the goods are made available to the person to whom they are supplied;
• Receipt of payment is made;
• Tax invoice is issued.

i) The firm should write off the sales as bad debts in its books,
Inform the Commissioner-General in writing supporting the report with official liquidation
The firm, on the basis of the above, can put in a claim for the input tax on the bad debt as an adjustment in line with section 46 of the VAT ACT 2013, Act 870

ii) The taxable value according to section 43(4) under this situation would be based on the total amount of the installments. The tax will be calculated on the full value at the time of supply and not when the installment is paid. The price shall exclude the interest or finance charges.

iii) Regulation 17 of the VAT Regulation 1998 states that “where goods are supplied on sale or return, the tax point shall be the earliest of
a. The date when the purchaser chooses to keep the goods; or
b. The issue of a tax invoice by the seller, or
c. The receipt of payment by the seller, other than a deposit; or
d. The expiry of the period within which the customer may return the goods; or
e. Twelve months after the date of dispatch by the seller

iv) The customers should first obtain a copy of their relief letter/documents. Reliefs per section 38 of the VAT Act and the Third Schedule allow Vat registered manufacturers for raw materials at importation. The case however seems to suggest local purchases, and thus the Manufacturing company cannot claim relieve from such purchases. The company would thus have to claim the VAT, from Jude Power.                       (2.5 marks for point (i)-(iv) = 10 marks)

• Premium received relating to 2015 in the year 2014 has been deducted from the gross premium.
• Interest on commercial papers has been assumed to be gross, hence withholding tax deducted in arriving at the net tax payable.
• It is assumed that the insurance company has a stake in the company paying dividend of 25% hence
• no withholding tax but dividend added to income in line with section 44 of Act 2000 Act 592.
• It could also be assumed that the dividend should suffer a final withholding tax hence should not be added in the determination of assessable income.
• Tax charged on investment as business income is negative
  

Effective Rate of Tax of the UK income:

Exchange Rate =£1 =4.50
800*4.50 = 3,600
4000*4.50 =18,000

A comparison of the UK effective rate with the Ghana effective rate shows that the Ghana rate is lower.
With the Ghana rate being lower than that of UK, the UK income has to be taxed at the average rate of Ghana tax as follows;
Tax on Total Income                                                           = 8,752.50
Less Foreign tax credit granted (18.88% of 18,000)    = 3,398.40
.                                                                                              = 5,354.10

1. France
2. Belgium
3. Italy
4. South Africa
5. Germany
6. Switzerland
7. Netherlands
8. Denmark
9. United Kingdom                                                (Any 8 for 4 marks)

This consists of the transaction value, i.e. the price actually paid or payable for the imported goods
In addition, it may include the following:
i) Commission and brokerage except buying commissions.
ii) the cost of containers
iii) the cost of package whether for labour materials.
iv) materials, components, parts and similar items incorporated in the imported goods.
v) engineering, development, artwork, design work, plans and sketches undertaken elsewhere other than in the country of importation and necessary for the production of the imported goods.
vi) Royalties and license Fee
vii) The cost of transport of the imported goods to the part of place of importation.
viii) Loading unloading and handling charges with the transport of the imported goods to the part of place of importation.
x) the cost of insurance

1. The business must be registered for VAT that is he/she must be a registered VAT trader
2. The business must have submitted returns for all months for which it has been in operations.
3. The business must complete and submit a prescribed VAT claim form for the refund of the VAT paid to the VAT Service
4. The business must be engaged in the export of 25% or more of the output
5. Total export proceeds should have been repatriated by importer’s bank to exporter’s authorized dealer banks in Ghana
6. The VAT paid should qualify as deductible input VAT
7. The input VAT paid should exceed the output VAT paid
8. Possession of all original tax (vat) invoices
9. Where the credit remains outstanding for a continuous period of three months or more

PROVISIONAL ASSESSMENT:
It is an assessment that emanates from the office of the Commissioner-General which indicates a persons’ tax liability based on Commissioner General’s best judgement. It indicates the chargeable income and the tax charged. It also indicates the manner of objection.
SELF-ASSESSMENT:
This is a mode of assessment where the onus of determining the tax liability and the payment of the tax thereby is on the taxpayer. The taxpayer is expected to furnish the Commissioner with an estimate of the chargeable income and the tax liability at the commencement of his basis period.

(i) Under provisional assessment, there is usually a delay in the issuance and service of the notice of assessment. But self-Assessment avoids delay since the assessment is made by the taxpayer.
(ii) Under self assessment, there is trust between the taxpayer and the tax administrator
(iii) There is high frequency of objection under provisional assessment but self assessment minimizes the rate of objection since the taxpayer is involved in the determination of the tax liability.
(iv) There is a high cost of collection under provisional assessment but self-assessment reduces collection cost to the Revenue since the assessment is made by the taxpayer.
(v) Under provisional assessment, officers are much occupied in the issue of notices and have little time to attend to other matters. But self-assessment saves time for the Revenue Officers that can be used in reviewing cases of greater revenue potential.
(iv) Self assessment tends to make taxpayers more conscious of their tax obligations since they are involved in the process.
(vii) Promotes tax compliance and good citizenship

UNDER ESTIMATING ESTIMATED TAX PAYABLE
Chargeable Income (based on Returns)                                  = 1,800,000,000
Estimated Chargeable Income (Self Assessment)                  = 1,200,000,000
Estimated Chargeable Income                   = 66.67% of the Actual Income
i.e. (1,200,000,000/1,800,000,000) x100

PENALTY
90% of Tax payable based on Actual Income = 405, 0000,000 (90% of 450,000,000)
Estimated Tax (Self Assessment)   = 300,000,000
Difference = 105,000,000
Penalty = 30% of 105, 000,000 = 31,500,000

• It indicates the quality of the accounts to the examiner, whether proper books have been kept and therefore acceptable.
• It is required on a tax return certifying that all information to the Commissioner-General is complete and accurate and can be provided as evidence that can be tendered in court.