Domestic Tax Revenue

Domestic Tax Revenue Division
The Domestic Tax Revenue Division (DTRD) is a division of the Ghana Revenue Authority under the Ministry of Finance. It is a Public Service Organization charged with domestic tax administration. As a division of the Ghana Revenue Authority, it is very strategic in the achievement of national goals. It is headed by a Commissioner who is responsible for the day to day running of the division and subject to the direction of the Commissioner General and the Ghana Revenue Authority Board on matters of policy. FUNCTIONS The core functions of the Service are: 1. 2. 3. 4. To identify all tax payers. Assess the taxpayer to taxes & levies. Collect the taxes and levies. Pay all amounts collected into the consolidated fund.

RESPONSIBLITIES OF DOMESTIC TAX REVENUE DIVISION The division is responsible, under various legislations, for the collection of the following taxes & levies:
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Income Tax ± Corporate Tax, personal Income Tax, and Pay As You Earn (PAYE) Value Added Tax Gift Tax Capital Gains Tax Domestic Excise Duty Stamp Duty Royalties National Health Insurance Levy (NHIL) GetFund Levy Communications Levy National Stabilization Levy.

Domestic taxes are administered by the Domestic Tax Revenue Division (DTRD) of the Ghana Revenue Authority. It is the merger of the operational wings of the erstwhile Value Added Tax Service and the Internal Revenue Service. Some of the domestic taxes being administered by the DTRD include:

INCOME TAX Corporate Tax: This is the tax paid by companies on their profits in the year.232 Rate (%) Free 5 10 17. The current Personal Income Tax rates took effect from June 2010 Pay As You Earn (PAYE): The PAYE contributions are withholdings from salaries of employees in order to satisfy their income tax responsibilities.574.008 1.60 Cumulative Chargeable Income (GH¢) 1.186 Rate (%) NIL 5 10 17.55 .5 Tax (GH¢) NIL 1 6 207. The tax rate is 25%.6 Exceeding 16.968 16.248 1.490.200 25% MONTHLY TAX RATES Chargeable Income (GH¢) First 84 Next 20 Next 60 Next 1.350 Cumulative Tax (GH¢) NIL 1 7 214.5 Tax (GH¢) NIL 12 72 2.55 Cumulative Chargeable Income (GH¢) 84 104 164 1. The PAYE is computed with the Personal Income Tax rates. (See box below) ANNUAL TAX RATES ± EFFECTIVE JUNE 2010 Chargeable Income (GH¢) First 1. Personal Income Tax: Self-employed persons are required to pay Income tax at graduated rates in four equal installments.008 Next 240 Next 720 Next 14.200 Cumulative Tax (GH¢) NIL 12 84 2.

The total value of taxable gift(s) must exceed GH¢50. buildings. business operators in the informal sector are grouped according to business type e. Assets on which tax is imposed include land. trotros. y y y y 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. but on documents brought into being for the purposes of recording transactions. The sticker must be pasted on the front windscreen Monitoring is done with the assistance of the Police Service TAX STAMP This is a tax collected from small-scale self-employed persons in the informal sector on quarterly basis. business assets including goodwill and shares of a resident company.00. etc. It is therefore a tax on documents or specific instruments which have legal effect. STAMP DUTY Stamp duty is administered under the Stamp Duty Act. butchers etc.00 in a year of assessment. RENT TAX This is the tax paid by rent income earners on the gross amount earned in a year of assessment.Exceeding 1350 25% Vehicle Income Tax (VIT): This is a tax collected from commercial vehicle operators on quarterly basis. GIFT TAX This is a tax payable by a recipient on the total value of taxable gifts received in a year of assessment. taxis. shares. The rate of tax is 8% on the gross rent income. tour buses. bonds and securities. money (including foreign currency). dressmakers. Assets on which tax is imposed include land. business and business assets. MINERAL ROYALTIES . buildings. The Stamp Duty is not a tax on transactions. The business types are further grouped by class/size to arrive at equitable rates to be paid according to both type and size.g.g. The rate of tax is 5%. chop bar owners. susu collectors. 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. Under the Tax Stamp System. It is a final tax. 2005 (Act 689). The rate of tax is 15%.

COMMUNICATIONS SERVICE TAX (CST) The Communications Service Tax (CST) is a tax levied on charges for the use of communications services that are provided by communications service operators. A zero (0) rate is also applied to all exports. who in turn pay all CST collected on a monthly basis. The NHIL is collected by registered businesses in the same way as VAT is collected. . VAT Value Added Tax (VAT) is a broad-based tax imposed on the expenditure of consumers when they purchase goods and services. It is designed for traders operating in the retail sector. registered retailers of taxable goods shall charge VAT/NHIL at a marginal rate of 3% on the value of each taxable item sold. The current standard rate of the tax is 12½ percent. It is collected by businesses which are registered to charge the tax in stages on the ³value added´ from the manufacturing to retail level The businesses then account for the tax so collected at the end of every month. Under the VFRS. All goods and services are subject to the levy unless they are otherwise exempted. The levy is charged at a rate of 2½ on the VAT exclusive selling price of goods supplied or service rendered. NATIONAL HEALTH INSURANCE LEVY (NHIL) The National Health Insurance Levy (NHIL) is a levy imposed on goods and services supplied in or imported into the country. VAT Flat Rate Scheme (VFRS) This is a special method for collecting and accounting for VAT/NHIL. The rate is 5%. It is paid by consumers to the communications service providers.This is a tax imposed on persons for the extraction of natural resources on or under the surface of the earth.

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