PwC 2021 Budget - Government COVID -19 Support

26-03-2021

PwC 2021 Budget - Government COVID -19 Support

Background

In 2020, as part of Government’s Emergency Preparedness and Response Plan (EPRP I & II) and the Coronavirus Alleviation Programme (CAP), Government introduced some tax incentives in support of taxpayers amid the COVID-19 pandemic. One of these incentives was that any taxpayer who settled all outstanding tax liabilities on or before 30 June 2020 would be eligible for the remission of penalties on those tax liabilities.

In the 2021 Budget Statement read on Friday, 12 March 2021, Government indicated its intention to extend this measure. Paragraph 267 under COVID-19 Support of the Budget Statement reads:

“Extension of the waiver of interest as incentive for early payment of accumulated tax arrears: A waiver of penalty and interest on accumulated tax arrears up to December 2020 to reduce cash flow challenges for companies and individuals who arrange terms with GRA to pay up the principal by September 2021. Beneficiaries of these relieves will have to be registered with the Ghana Revenue Authority and must have fulfilled their first quarter tax obligations.”

 

What does this mean for taxpayers?

Taxpayers have the opportunity of receiving a waiver of penalties and interest on qualifying outstanding tax liabilities. In order to be eligible for this incentive (waiver of penalties and interest), registered taxpayers must (at a minimum) fulfill the following obligations:

  • File 2021 self assessment estimate and pay first quarter instalment tax by 31 March 2021;
  • File outstanding withholding tax returns and pay withholding taxes up to March 2021 by 15 April 2021;
  • File outstanding VAT and NHIL & GETFL returns and pay the associated liabilities up to March 2021 by 30 April 2021;
  • File outstanding PAYE returns and pay PAYE taxes up to March 2021 by 15 April 2021; and
  • File any outstanding tax return not mentioned above and make payment for any taxes due by March 2021.

Pending details that will be provided by the Ghana Revenue Authority,  PwC will encourage you to fulfill all your first quarter tax obligations so that you can be eligible for the tax amnesty mentioned in the 2021 Budget.  

For additional information, please refer to PwC's 2021 Budget Highlights: https://www.pwc.com/gh/en/publications/budget-highlights.html 

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