Question Tag: Voluntary registration

a) Although the Value Added Tax Act, 2013 (Act 870) as amended, allows for voluntary VAT registration, there are situations where an application for such registration may be declined.

Required: State the circumstances under which a voluntary VAT registration application might be declined by the Commissioner-General.

b) Maame Yeboah, a VAT-registered trader, set aside goods valued at GH¢12,000 for Nene Abayateye, who made a deposit of GH¢2,000. The agreement stipulated that the goods would be delivered once the remaining GH¢10,000 was paid. However, by mutual agreement, the contract was terminated before the full payment was made.

Required: Explain the VAT implications of these transactions.

c) Woara Manufacturing LTD, based in Techiman, produces roofing sheets. The company has recently registered for VAT but is uncertain about how to handle input VAT paid before their registration. The company seeks your advice on this matter.

Required: Provide guidance on the rules regarding the deductibility of input VAT that was incurred prior to a company’s VAT registration.

d) Naa Pioluo, a postpaid customer of Telecel Ghana LTD, received his billing for June 2024, amounting to GH¢638,250, which includes all applicable taxes and levies. Concerned about the charges for his telephone usage, he wishes to understand the tax breakdown within the total amount.

Required: Calculate the amounts for the following taxes included in the June 2024 bill: i) VAT ii) National Health Insurance Levy (NHIL). iii) Ghana Education Trust Fund Levy (GETL).  iv) COVID-19 Levy.  v) Communication Service Tax (CST).

e) A close relative of yours is into a profitable business in Ghana. The business has had a tax decision made on it by the Commissioner-General. Your relative has objected to the tax decision and the matter has been referred to the Technical and Objection Committee of the Ghana Revenue Authority (GRA) for a determination. Your relative has invited you on the matter to represent him before the Technical and Objection Committee.

Required: What steps will you follow to ensure proper representation and success in resolving the matter?