TAMALE TECHNICAL UNIVERSITY
FACULTY OF BUSINESS
DEPARTMENT OF ACCOUNTANCY
MASTER OF SCIENCE (MSc) IN ACCOUNTANCY
MSA 505: ADVANCED TAXATION
GROUP ASSIGNMENT
(GROUP OF BETWEEN 15 TO 20)
GROUP ASSIGNEMENT: In a group of fifteen (15) to twenty (20), pick the question assigned to your group
and present on word file by next week 8th March 2025. Subsequently, a PowerPoint presentation will be
schedule for in class presentation too.
Instruction on the word file: It should have a cover page that contains the names of students and student index
number / admission number. The response to the questions should start on a fresh page each and with the
question first before the solution on a fresh page too. The font size should be 12, font style is Times New Roman,
spacing should be 2 for cover page and 1.5 for main work, sentences should be justified, alignment should be
left align for starting of a paragraph, paragraphing should be block.
QUESTION ONE
(GROUP THREE)
Simon has been in employment at TaTU MSc Limited since 1st April 2018 as Financial Controller on a salary
scale of GHȼ24,000 × GHȼ12,000.00 – GHȼ120,000. His service conditions include the following:
i) Provision of a well-furnished bungalow in respect of which he pays GHȼ500 per month as rent by
way of deduction at source.
ii) Provision of a Land Cruiser Prado Vehicle with driver and fuel for both official and private purposes
iii) Social Security & National Insurance Trust contribution of 7%
His Returns submitted to Ghana Revenue Authority (GRA) on 8th January, 2025 in respect of 2024 Year of
Assessment show the following unconsolidated allowances and benefits:
i) Responsibility allowance of GHȼ800 per month for which the company pays him cash.
ii) Utilities allowance per annum, GHȼ7,200
iii) Risk allowance of 15% on basic salary and car maintenance allowance of GHȼ3,600 for the year.
iv)
Leave allowance of GHȼ2,400 per annum.
v) Watchman and a garden boy on salary of GHȼ350 and GHȼ400 per month respectively.
vi)
Medical allowance per year GHȼ4,800.
vii)
Meal’s allowance of GHȼ600 per month.
viii)
Two house helps on GHȼ380 wages each per month. The amount is paid to Simon in cash directly by
the company.
ix)
x)
xi)
Bonus of 30% of annual basic salary.
Monthly Overtime allowance of GHȼ1,000
Unaccountable Entertainment allowance of GHȼ6,000 a year.
Additional Information
i)
On 1st January, 2023 he was given a car loan of GHȼ50,000 to purchase a car for his wife at a simple
interest rate of 15.0% per annum. The institution gives similar facility to any other customer at the rate
of 28% but the statutory rate (Bank of Ghana Rate) is 25.0%. The loan is to be paid within the period
of 24 months.
ii) He is married with five (5) children, three (3) of whom are in SHS, the rest are working.
iii) He is also responsible for the upkeep of four (4) aged relatives of his.
iv)
He is currently pursuing a Master of Science degree in Accountancy at TaTU department of
Accountancy where he incurred GHȼ13,000 by way of educational expenses in 2024
v) His November and December, 2024 salary was paid on 4th January 2025. However, all allowances which
are unconsolidated were paid in full during 2024 except those tied to the basic salary.
Required:
For the 2024 Year of Assessment, calculate his:
1. Basic salary
2. Assessable income
3. Chargeable income
4. Tax liability
Suggested Solution
Name of Taxpayer: Simon
Year of Assessment: 2024
Basis Period: 1st January 2024 – 31st December 2024
Computation of Chargeable Income of Seth for the 2024 Year of Assessment
GHȼ
GHȼ
Basic Salary (W1)
77,000
Cash Allowances:
Responsibility Allowances (800*12)
9,600
Utility Allowance
7,200
Car Maintenance Allowance
3,600
Risks Allowance (15% x 77,000)
11,550
Leave Allowance
2,400
Medical Allowance
4,800
Meals Allowance (600*12)
7,200
House help Allowance (2*380*12)
9,120
Unaccountable Entertainment Allowance
6,000
61,470
Other Cash Allowances:
Overtime Payment (1,000*12)
12,000
Bonus (15%*77,000)
Indirect Cash Allowance:
SSF (7%*77,000)
Total Cash Emoluments
Non-Cash Benefits:
Car Element (=12.5%*167,410), Restricted to 18,000
Rent Element (W3)
Loan Benefit (W4)
Assessable Income from Employment
Less Reliefs:
Marriage
Child Education
Aged Dependent
Less Other Allowable Deductions:
Employer's Contribution (7%*93,000)
Employees' Contribution (5.5%*93,000)
Chargeable Income
Computation of Tax Liability
Year (2024)
Chargeable
Income
1. First
2. Next
3.Next
4.Next
5.Next
5,880
1,320
1,560
36,000
136,016
11,550
5,390
167,410
18,000
10,741
1,250
(1,200)
(1,800)
(2,000)
(6,510)
(5,115)
Rate %
Tax Payable
(GHȼ)
0
5
10
17.5
25
0
66
156
6,300
34,004
Computation of Tax Payable
Total Tax liability for the year
Add Withholding Bonus Tax
Total Tax Liability payable
Workings
(W1) Calculation of Basic Salary
Scale: GHȼ24,000 * GHȼ12,000 – GHȼ120,000
Period
GHȼ
1/04/2018 – 31/03/2019
24,000
1/04/2019 – 31/03/2020
36,000
1/04/2020 – 31/03/2021
48,000
1/04/2021 – 31/03/2022
60,000
1/04/2022 – 31/03/2023
72,000
1/04/2023 – 31/03/2024
84,000
40,526.00
577.50
39,948.50
23,550
29,991
197,401
(5,000)
(11,625)
180,776
Cumulative
Chargeable
Income
5,880
7,200
8,760
44,760
180,776
Cumulative
Tax Payable
0
66
222
6,522
40,526
1/04/2024 – 31/03/2025
1/04/2025 – 31/03/2026
1/04/2026 – 31/03/2027
96,000
108,000
120,000
Basis Period = 1st January, 2024 – 31st December, 2024
= (3/12 *84,000) + (9/12*96,000)
NB: 01/04/2023 – 31/03/2024 has 3 months of 2024 and 01/04/2024 – 31/03/2025 has 9 months of 2024 in it.
= 21,000 + 72,000
= GHȼ93,000
November and December Salaries paid on 4th January, 2025. Thus, subtract them from it
= 2/12*96,000 = GHȼ16,000
Applicable basic salary for computation = 93,000 – 16,000 = GHȼ77,000.
NB: You are taxed on only income received and on cash basis.
(W2) 15% of Bonus Tax
= 15% * 77,000
= GHȼ11,550
Withholding tax on 15% Bonus = 5% * 11,550 = GHȼ577.50
(W3) Rent Element
= (10% * 167,410) – (500 * 12)
= GHȼ10,741
(W4) Loan Benefit
Loan is from employer to employee, the duration is more than 12 months and the Amount, GHS50,000 is
greater than 3 months basic salary (23,100)
Formula = 1/4(B-A), where
B = 25% (Bank of Ghana rate) * 50,000 = 12,500
A = 15% (Simple interest rate) * 50,000 = 7,500
= ¼ (12,500 – 7,500)
= GHȼ1,250
QUESTION TWO
Mr VIRGILSON has been in employment at TaTU MBA Limited since 1st April 2017 as Financial Controller
on a salary scale of GHȼ24,000 × GHȼ12,000.00 – GHȼ120,000. His service conditions include the following:
iv) Provision of a well-furnished bungalow in respect of which he pays GHȼ500 per month as rent by
way of deduction at source.
v) Provision of a Land Cruiser Prado Vehicle with driver and fuel for both official and private purposes
vi) Social Security & National Insurance Trust contribution of 7%
His Returns submitted to Ghana Revenue Authority (GRA) on 8th January, 2024 in respect of 2023 Year of
Assessment show the following unconsolidated allowances and benefits:
i)
ii)
iii)
iv)
v)
vi)
vii)
viii)
ix)
x)
xi)
Responsibility allowance of GHȼ800 per month for which the company pays him cash.
Utilities allowance per annum, GHȼ7,200
Risk allowance of 15% on basic salary and car maintenance allowance of GHȼ3,600 for the year.
Leave allowance of GHȼ2,400 per annum.
Watchman and a garden boy on salary of GHȼ350 and GHȼ400 per month respectively.
Medical allowance per year GHȼ4,800.
Meal’s allowance of GHȼ600 per month.
Two house helps on GHȼ380 wages each per month. The amount is paid to Seth in cash directly by the
company.
Bonus of 30% of annual basic salary.
Monthly Overtime allowance of GHȼ1,000
Unaccountable Entertainment allowance of GHȼ6,000 a year.
Additional Information
vi)
On 1st January, 2022 he was given a car loan of GHȼ50,000 to purchase a car for his wife at a simple
interest rate of 15.0% per annum. The institution gives similar facility to any other customer at the rate
of 28% but the statutory rate (Bank of Ghana Rate) is 25.0%. The loan is to be paid within the period
of 24 months.
vii)
He is married with five (5) children, three (3) of whom are in SHS, the rest are working.
viii)
He is also responsible for the upkeep of four (4) aged relatives of his.
ix)
He is currently pursuing a Master of Science degree in Accountancy at TaTU department of
Accountancy where he incurred GHȼ13,000 by way of educational expenses in 2023
x) His December, 2023 salary was paid on 4th January 2024. However, all allowances which are
unconsolidated were paid in full during 2023 except those tied to the basic salary.
Required:
For the 2023 Year of Assessment, calculate his:
1. Basic salary
2. Assessable income
3. Chargeable income
4. Tax liability
Suggested Solution
Name of Taxpayer: MR VIRGILSON
Year of Assessment: 2023
Basis Period: 1st January 2023 – 31st December 2023
Computation of Chargeable Income of Seth for the 2023 Year of Assessment
GHȼ
GHȼ
Basic Salary (W1)
85,000
Cash Allowances:
Responsibility Allowances (800*12)
9,600
Utility Allowance
7,200
Car Maintenance Allowance
Risk Allowance (15% x 85,000)
Leave Allowance
Medical Allowance
Meals Allowance (600*12)
House help Allowance (2*380*12)
Unaccountable Entertainment Allowance
Other Cash Allowances:
Overtime Payment (1,000*12)
Bonus (15%*85,000)
Indirect Cash Allowance:
SSF (7%*85,000)
Total Cash Emoluments
Non-Cash Benefits:
Car Element (=12.5%*178,370), Restricted to 18,000
Rent Element (W3)
Loan Benefit (W4)
Assessable Income from Employment
Less Reliefs:
Marriage
Child Education
Aged Dependent
Less Other Allowable Deductions:
Employer's Contribution (7%*93,000)
Employees' Contribution (7%*93,000)
Chargeable Income
3,600
12,750
2,400
4,800
7,200
9,120
6,000
62,670
12,000
12,750
24,750
5,950
178,370
18,000
11,837
1,250
(1,200)
(1,800)
(2,000)
(6,510)
(6,510)
31,087
209,457
(5,000)
(13,020)
191,437
Computation of Tax Liability
NB: From January to April 30th, the 2022 Annual rates were still in used and 2023 Fiscal Year annual rates
took effect 1st May 2023. Therefore, January to April Income will be taxed using the 2022 annual rates and
the May to November will be taxed using the 2023 annual rates.
January to April is 4 months and May to November is 7 months.
January to April = 4/11 x 191,437 = 69,613.45 and May to November = 7/11 x 191,437 = 121,823.55
Year (2022)
Chargeable
Income
Rate %
Tax Payable
(GHȼ)
1. First
2. Next
3.Next
4.Next
5.Next
1,460
440
520
12,000
55,193.45
0
5
10
17.5
25
0
22
52
2,100
13,798.36
Cumulative Cumulative
Chargeable
Tax
Income
Payable
1,460
0
1,900
22
2,420
74
14,420
2,174
69,613.45 15,972.36
Year (2023)
Chargeable
Income
Rate %
Tax Payable
(GHȼ)
1. First
2. Next
3.Next
4.Next
5.Next
2,814
770
910
21,000
96,329.55
0
5
10
17.5
25
0
38.5
91
3,675
24,082.39
Total (15,972.36 + 27,887.89)
Add Withholding Bonus Tax
Total Tax Liability
Cumulative Cumulative
Chargeable
Tax
Income
Payable
2,814
0
3,584
38.5
4,494
130.5
25,494
3,805.5
105,087.6
27,887.89
43,860.25
637.50
43,222.75
Workings
(W1) Calculation of Basic Salary
Scale: GHȼ24,000 * GHȼ12,000 – GHȼ120,000
Period
GHȼ
1/04/2017 – 31/03/2018
24,000
1/04/2018 – 31/03/2019
36,000
1/04/2019 – 31/03/2020
48,000
1/04/2020 – 31/03/2021
60,000
1/04/2021 – 31/03/2022
72,000
1/04/2022 – 31/03/2023
84,000
1/04/2023 – 31/03/2024
96,000
1/04/2024 – 31/03/2025
108,000
1/04/2025 – 31/03/2026
120,000
Basis Period = 1st January, 2023 – 31st December, 2023
= (3/12 *84,000) + (9/12*96,000)
NB: 01/04/2022 – 31/03/2023 has 3 months of 2023 and 01/04/2023 – 31/03/2024 has 9 months of 2023 in it.
= 21,000 + 72,000
= GHȼ93,000
December Salaries paid on 4th January, 2024. Thus, subtract it from
= 1/12*96,000 = GHȼ8,000
Applicable basic salary for computation = 93,000 – 8,000 = GHȼ85,000.
NB: You are taxed on only income received and on cash basis.
(W2) 15% of Bonus Tax
= 15% * 85,000
= GHȼ12,750
Withholding tax on 15% Bonus = 5% * 12,750 = GHȼ637.50
(W3) Rent Element
= (10% * 178,370) – (500 * 12)
= GHȼ11,837
(W4) Loan Benefit
Amount, GHS50,000 is greater than 3 months basic salary (23,250)
Formula = 1/4(B-A), where
B = 25% (Bank of Ghana rate) * 50,000 = 12,500
A = 15% (Simple interest rate) * 50,000 = 7,500
= ¼ (12,500 – 7,500)
= GHȼ1,250
NB: Annual Rates used for the solution
Year (2023)
Chargeable
Rate %
Income
Tax Payable
(GHȼ)
1. First
2. Next
3.Next
4.Next
5.Next
6. Next
7. Exceeding
4,824
1,320
1,560
36,000
196,740
359,556
600,000
0
5
10
17.5
25
30
35
0
66
156
6,300
49,185
107,866.80
210,000
Year (2022)
Chargeable
Income
Rate %
Tax Payable
(GHȼ)
1. First
2. Next
3.Next
4.Next
5.Next
6. Exceeding
4,380
1,320
1,560
36,000
196,740
240,000
0
5
10
17.5
25
30
0
66
156
6,300
49,185
72,000
QUESTION THREE
Cumulative Cumulative
Chargeable
Tax
Income
Payable
4,824
0
6,144
66
7,704
222
43,704
6,522
240,444
55,707
600,000
163,573.80
Cumulative Cumulative
Chargeable
Tax
Income
Payable
4,380
0
5,700
66
7,260
222
43,260
6,522
240,000
55,707
(GROUP ONE)
a) The Pastoral Council of the National Cathedral Church has approached you as a tax consultant for tax
advice on the operation of the Church, including allowances paid to the Pastors and other Reverend
Ministers. You are informed that the income of the Church is from donations, offertories and tithes from
its congregants which are used towards charitable causes in the community and the upkeep of the
Church. The church recently purchased 3 VIP buses to raise more money to support the church’s finance
since the small income from the church’s store located on the premises of the church is not bringing in
enough money. You are also informed that the Church was registered as a company limited by guarantee
under the Companies Act, 2019 (Act 992).
Required:
You are required to write a memorandum (since you also double as a member of the Pastoral Council)
to the Chairman of the Pastoral Council of the Church to explain the Income Tax implications of the
income of the Church and the allowances paid to the Pastors and other Reverend Ministers. Please note
that your advice should be based on the provisions of the tax laws of Ghana.
b) Miss Rosaline, the proprietress of ROSA Restaurant at East Gumani invested part of her profits in 182
– day Treasury Bills in May 2023. The rate of interest was 28% and the amount she invested was
GHȼ10,000.00. In July 2023, she was cash strapped and decided to withdraw the money. The bank
charged a rediscounted fee of GHȼ300.00. Prior to the investment, she consulted VEMAX Consult Ltd
for an advice on the appropriate investment option. She was charged a consultancy fee of GHȼ500. She
charged these amounts as expenses in her income statement. Are these expenses allowable? Give reasons
Suggested Solution
a)
Income of the Church
Section 97 of Act 896 provides a follow: “Section 97 – Approval of charitable organisation
Section 97 (1) The Commissioner General may approve an entity as a charitable organisation for the purpose
of this Act, Thus the C.G shall approve
Section 97 (2) The Commissioner-General shall, before approving an entity under subsection (1), ensure the
that, thus before approval
a) The entity is established to operate as
i. Charitable institution which is of a public nature;
ii. A religious institution which is of a public nature; or
iii. A body of persons formed for the purpose of promoting social activities or sporting activities
of public in nature
b) The entity has a written constitution that prohibits that entity from
i. Engaging in a party-political activity, supporting a political party or using its platform to
engage in party politics;
ii. Any function other than those specified in paragraph (a); and
iii. Conferring a private benefit, other than in pursuit of a function of the entity specified in
paragraph (a)
Section 97 (3) The Commissioner-General may for good cause or for the contravention of a requirement
specified in subsection (2), revoke an approval granted under subsection (1).
Section 97 (4) The income accruing to or derived by a charitable organization is exempt from tax
Section 97 (5) Subsection (4) does not apply to the business income of the charitable organisation
Since the church was incorporated as a company limited by guarantee, it is presumed (by its object) that it was
not carrying on business for the purpose of making profits. That notwithstanding, the income accruing to or
derived by the Church would be exempt from corporate tax, except income accruing to or derived from a
business as provided for under Section 97 of Act 896, thus is:
a) The church functions as a religious or charitable institution of a public character;
b) The church has been issued by the Commissioner-General with an approval currently in force
stating that it is an exempt organisation; and
c) None of the church’s income or assets confers or may confer, a private benefit, or other than in
pursuit of the church’s religious or charitable function.
However, the church income from the setup of the store and the operation of the busses are taxable since the
income derived from business are business income in accordance with section 97
Allowances paid to the Pastors and other Reverend Ministers
Allowances paid to the Pastors and other Reverend Ministers qualify to be taxed under section 4 of the
Income Tax Act, 2016 (Act 896) because the allowances are gains from employment.
b)
The expenses incurred are not allowable, it is an excluded expenditure because it was incurred in deriving an
exempt income (interest on treasury bills). Act 896 states that, interest paid by a resident financial institution or
to an individual on Government of Ghana bond is exempt from income tax. Excluded expenditure means
expenditure to the extent incurred by a person in deriving exempt amounts or final withholding payments.
QUESTION FOUR
(GROUP EIGHT)
a) The income of an individual from an employment for a year of assessment is the gains and profits of
that individual from the employment for the year or a part of the year, but not every payment made to
an employee is necessarily made to him as a profit from his employment.
Required:
You are required to state the exclusions or exemptions from employment income
b) Mahama Iddrisu has been a field officer of the Maataa Ltd for several years up to 31st May, 2023 when
he resigned. At the time of his resignation, he was on a salary of GHȼ36,000 per annum and field
allowance of GHȼ1,000 per month. He contributed 5.5% of his salary to the social security scheme. On
1st June, 2023, he took up appointment as an Accountant of Def3Def3 Limited on a basic salary of
GHȼ48,000 per annum. His other entitlements at Def3Def3 Limited were agreed as follows:
Accountable imprest GHȼ1,200 per month
Security allowance GHȼ1,300 per month
House help allowance GHȼ600 per month
Inconvenience allowance GHȼ500 per month
Mahama Iddrisu was provided with a double cabin pick-up with a driver and fuel at Def3Def3. He was
also provided with a furnished accommodation. He contributes 5.5% of his salary to the social security
scheme. Mahama has two wives and six children but lives with a house help. Two of the children are at
kindergarten while the other four are at Junior High Schools in Accra. He has full responsibility over
his family and his aged mother. He remits the mother GH4,000 monthly.
Required:
Determined his chargeable Income and tax liability for the 2023 year of assessment
Suggested Solution
a)
✓
✓
✓
✓
✓
✓
✓
✓
an exempt under section 7 of Act 896
a final withholding payment
a discharge or reimbursement of an expense incurred by an individual on behalf of the employer
a discharge or reimbursement of the dental, medical or health insurance expenses of an individual
where the benefit is available to each full-time employee on equal terms
a payment providing passage of the individual (Passage Cost) – 3 elements. It does not include
dependents. Employees should be:
• Non-Resident at the time of appointment,
• Recruited from outside, and
• Employed solely for the employer
Provision of accommodation on site (timber, mining, petroleum, building, construction and farming)
A payment made to employees on a non-discriminatory basis
Redundancy pays
b)
Mahama Iddrisu
Computation of Tax Liability for the 2023 Year of Assessment
01 / 01 / 2023 - 31 / 12 / 2023
GHȼ
GHȼ
GHȼ
Maataa Ltd
Basic Salary {(36,000/12) *5}
15,000.00
Cash Allowances and Benefits:
Field Allowances (1,000 * 5)
5,000.00
Total Cash Emolument / AI
20,000.00
Def3Def3 Limited
Basic Salary {(48,000/12) *7}
28,000.00
Cash Allowance and Benefits:
Security allowance (1,300*7)
9,100.00
Inconvenience allowance (500*7)
3,500.00
House Help allowance (600*7)
4,200.00
16,800.00
Total Cash Emolument
44,800.00
Benefits in Kind:
Car Element (12.5%*44,800)
5,600
Rent element (10%*44,800)
4,480
10,080.00
Assessable Income
54,880.00
74,880.00
Deductions:
Employee’s contribution:
SSF (5.5%*15,000)
825.00
SSF (5.5%*28,000)
1,540.00
Marriage relief
1,200.00
Child Education Relief (600*3)
1,800.00
Aged dependent relief
1,000.00
CHARGEABLE INCOME
(6,365.00)
68,515.00
Computation of Tax liability
NB: From January to April 30th, the 2022 Annual rates were still in used and 2023 Fiscal Year annual rates
took effect 1st May 2023. Therefore, January to April Income will be taxed using the 2022 annual rates and
the May to November will be taxed using the 2023 annual rates.
January to April is 4 months and May to December is 8 months.
January to April = 4/12 x 68,515 = 22,838.33 and May to November = 8/12 x 68,515 = 45,676.67
NB: Annual Rates used for the solution
Year (2022)
1. First
2. Next
3.Next
4.Next
5.Next
Year (2023)
1. First
2. Next
Chargeable
Income
Rate %
Tax Payable
(GHȼ)
1,460
440
520
12,000
8,418.33
0
5
10
17.5
25
0
22
52
2,100
2,104.58
Chargeable
Income
Rate %
Tax Payable
(GHȼ)
3,216
880
0
5
0
44
Cumulative Cumulative
Chargeable
Tax
Income
Payable
1,460
0
1,900
22
2,420
74
14,420
2,174
22,838.33
4,278.58
Cumulative Cumulative
Chargeable
Tax
Income
Payable
3,216
0
4,096
44
3.Next
4.Next
5.Next
1,040
24,000
16,540.67
10
17.5
25
104
4,200
4,135.17
5,136
29,136
45,676.67
148
4,348
8,483.17
Tax Liability Computation
Total (4,278.58 + 8,483.17)
12,761.75
Therefore, tax liability for the 2023 year of assessment is GHS12,761.75
QUESTION FIVE
(GROUP TWO)
GILZINA Company Limited, a manufacturing company located in Koforidua started business on 1st January
2023 preparing accounts to 31st December. Below is an extract of the company’s Income Statement for the year
ended 31st December 2023 (all the amounts are in Ghana cedis):
Turnover
4,250,000.00
Cost of sales
3,050,000.00
Gross Profit
1,200,000.00
Discount received on Treasury bills (Gross)
65,000.00
Dividend (net of withholding Tax)
15,000.00
1,280,000.00
Less Expenses:
Salaries and wages
400,000.00
Repairs
125,000.00
Rents and rates
60,000.00
Utilities
40,000.00
Vehicle maintenance
100,000.00
Entertainment
10,000.00
Legal Expenses
50,000.00
Bad debts
10,000.00
Advertising
75,000.00
Depreciation
35,000.00
905,000.00
Profit before tax
375,000.00
Provision for corporate tax
96,250.00
Net Profit
278,750.00
Notes to the Accounts:
a) The following fixed assets were bought during the year:
Asset
Date of Purchase
Cost (in GHȼ)
Furniture & Fittings
02/01/2023
7,500.00
Computers
09/01/2023
15,000.00
Motor Van
01/07/2023
28,000.00
Single cabin Toyota Hilux (1 ton)
19/03/2023
30,000.00
b) Legal expenses:
i. Suit for collection of the company’s debts - GHȼ30,000.00
ii. Defending the Managing Director for violating Foreign Exchange Act, 2006, (Act 723) as
amended - GHȼ20,000
c) Repairs were as follows: Burglar proof for the building - GHȼ30,000; extension of office building GHȼ50,000, and repairs of a motor vehicle - GHȼ15,000 which had a written down value of
GHȼ40,600 at the time of the repairs.
d) Entertainment: GHȼ5,500.00 was spent on the birthday celebration of the Managing Director’s first
daughter, who is the operations manageress of the company. The balance was spent on customers.
e) Advertisement was made up as follows:
iii. Permanent neon sign - GHȼ40,000.00
iv.
Recruitment advertisement in the Daily Graphic - GHȼ25,000.00
v. Advertisement tax - GHȼ10,000.00
f) Vehicle maintenance is made up of:
vi.
Purchases of new engine - GHȼ15,000.00
vii.
Fuel and servicing - GHȼ85,000.00
Required
Compute the chargeable income and Tax liability of GILZINA Company Limited for 2023 Year of
Assessment.
Suggested Solution
Gilzina Company Limited
Computation of Chargeable Income for 2023 Year of Assessment
Basis Period: 01 / 01/ 2023
-
31 /12 / 2023
GHȼ
Net Profit as per accounts
Add Back:
GHȼ
375,000
Depreciation
35,000
Legal fees
20,000
Vehicle Maintenance Excess Repairs
12,970
Repairs:
Burglar-Proof
30,000
Office Building
50,000
Entertainment
10,000
Advertising – Permanent neon Sign
40,000
197,970
572,970
Less
Dividend Income
(15,000)
Assessable Income
557,970
Less Capital Allowance
(41,541)
CHARGEABLE INCOME
516,429
Tax liability =
18.75% x GHȼ516,429
=
GHȼ96,830.44
WORKINGS
CAPITAL ALLOWANCE COMPUTATION
Year Basis Period
2023 1/1/2023-31/12/23
Cost
Excess Repairs
WDV c/f CA
Capital Allowance
WDV c/d
Class 1
40%
15,000
15,000
(6,000)
9,000
Class 2
30%
58,000
12,970
70,970
(21,291)
49,679
Class 3
20%
7,500
7,500
(2,250)
5,250
Class 4 A
10%
40,000
40,000
(4,000)
36,000
Class 4 B Total
10%
80,000
80,000
(8,000)
41,541
72,000
Excess Repairs Calculations
Year Basis Period
2023 01/01/2023 – 31/12/2023
Cost
Capital Allowance
WDV before Repairs
Excess Repairs
Class 1
40%
15,000
(6,000)
9,000
-
Class 2
30%
58,000
(17,400)
40,600
12,970
Class 3
20%
7,500
(2,250)
5,250
-
Class 4 A
10%
40,000
(4,000)
36,000
-
Class 4 B
10%
80,000
(8,000)
72,000
-
WDV before repairs
40,600
5%
2,030
Repairs
15,000
Excess Capitalised
12,970
QUESTION SIX
(GROUP FOUR)
Gilbert Nsoyine has been employed as the Chief Accountant of ORAL Ltd for several years. His basic salary
per month as at 1st January 2024 was GHȼ20,000.
He is entitled to the following monthly allowances:
GHȼ
Responsibility Allowance
8,000
House help Allowance
5,000
Accountable Imprest
6,000
Inconvenience allowance
2,500
Children’s Education Allowance
1,000
Risk Allowance
1,200
Additional Information:
(a) He received a bonus of 40% of annual basic salary at the end of the year.
(b) He received an overtime payment of GHȼ15,000 during the year.
(c) He is provided with a company vehicle with fuel for his official and private use.
(d) The employer also provides him with a well-furnished accommodation in respect of which GHȼ500 per
month is deducted at source as rent.
(e) He contributes 5.5% of his basic salary to social security and another 10% to a provident fund approved
by the Regulator. His employer also contributes 10% of his basic salary to the provident fund.
(f) He is married with four (4) children who are attending Government registered Senior High Schools in
different parts of Ghana.
(g) During the year, the employer provided educational support to Gilbert Nsoyine by paying the school
fees of his four children, totalling GHȼ4,800.
(h) He has a full responsibility over his father aged 54 and his mother aged 61. He remits to parents
GHȼ5,000 each per month.
(i) He engaged in part-time teaching at University of Ghana and was paid a total of GHȼ15,000 net of tax
in 2024 year of assessment.
(j) He earned interest of GHȼ10,500 on his investment in Government Treasury Bills and savings with
Access bank Ltd.
(k) In August 2024, he was promoted to the Finance Director position with a basic salary of GHȼ26,000 per
month. His other allowances and benefits remained the same throughout the year 2024.
Required
Calculate his tax liability for 2024 Year of Assessment
COMPUTATION OF TAX LIABILITY FOR THE 2024 YEAR OF ASSESSMENT
Basis period: 1/01/2024 – 31/12/2024
GHȼ
Basic salary (20,000 x 7) + (26,000 x 5)
GHȼ
270,000.00
Cash Allowances and Benefits:
Responsibility Allowance (8,000 x 12)
96,000.00
House Help Allowance (5,000 x 12)
60,000.00
Inconvenience Allowance (2,500 x 12)
30,000.00
Children’s Education (1,000 x 12)
12,000.00
Risk Allowance (1,200 x 12)
14,400.00
Overtime
15,000.00
Excess Bonus (108,000 – 40,500)
67,500.00
Educational Support
4,800.00
Total Cash Emolument
299,700.00
569,700.00
Benefits in Kind:
Vehicle element (10% x 569,700)
56,970.00
Restricted to (1,250 x 12)
15,000.00
Rent Element (10% x 569,970)
56,970.00
Source deduction (500 x 12)
(6,000.00)
50,970.00
Assessable Income
635,670.00
Allowable Deductions:
Marriage Relief
Child Education
1,200.00
(600 x 3)
Aged Dependent
1,800.00
1,000.00
Employee’s Contribution:
SSF
65,970.00
(5.5% x 270,000.00)
13,500.00
Provident Fund (6.5% x 270,000.00)
17,550.00
Chargeable Income
35,050.00
600,620.00
CHARGEABLE INCOME
Rate (%)
Tax Amt
CCI
CTA
First
4,824
0
0.00
4,824.00
0.00
Next
1,320
5
66.00
6,144.00
66.00
Next
1,560
10
156.00
7,704.00
222.00
Next
36,000
17.5
6,300.00
43,704.00
6,522.00
Next
196,740
25
49,185.00
240,444.00
55,707.00
Next
359,556
30
107,866.80
600,000.00
163,573.80
Exceeding
620
35
217
600,620.00
163,790.80
163,790.80
Tax on Bonus
2,025.00
Tax liability payable
165,815.80
QUESTION SEVEN
Gilbert Nsoyine has been employed as the Chief Accountant of OPAL Ltd for several years. His basic salary
per month as at 1st January 2024 was GHȼ24,000.
He is entitled to the following monthly allowances:
GHȼ
Responsibility Allowance
8,000
House help Allowance
5,000
Accountable Imprest
6,000
Inconvenience allowance
2,500
Children’s Education Allowance
1,000
Risk Allowance
1,200
Unaccountable entertainment imprest
1,500
Additional Information:
(a) He received a bonus of 30% of annual basic salary at the end of the year.
(b) He received an overtime payment of GHȼ15,000 during the year.
(c) He is provided with a company vehicle with fuel for his official and private use.
(d) The employer also provides him with a well-furnished accommodation in respect of which GHȼ500 per
month is deducted at source as rent.
(e) He contributes 5.5% of his basic salary to social security and another 10% to a provident fund approved
by the Regulator. His employer also contributes 10% of his basic salary to the provident fund.
(f) He is married with four (4) children who are attending Government registered Senior High Schools in
different parts of Ghana.
(g) During the year, the employer provided educational support to Gilbert Nsoyine by paying the school
fees of his four children, totalling GHȼ4,800.
(h) He has a full responsibility over his father aged 64 and his mother aged 65. He remits to parents
GHȼ5,000 each per month.
(i) He engaged in part-time teaching at University of Cape Coast and was paid a total of GHȼ15,000 net of
tax in 2024 year of assessment.
(j) He earned interest of GHȼ10,500 on his investment in Government Treasury Bills and savings with
Access bank Ltd.
(k) In August 2024, he was promoted to the Finance Director position with a basic salary of GHȼ28,000 per
month. His other allowances and benefits remained the same throughout the year 2024.
Required
Calculate his tax liability for 2024 Year of Assessment
Suggested Solution
COMPUTATION OF TAX LIABILITY FOR THE 2024 YEAR OF ASSESSMENT
Basis Period: 1/01/2024 – 31/12/2024
GHȼ
Basic salary (24,000 x 7) + (28,000 x 5)
GHȼ
308,000.00
Cash Allowances and Benefits:
Responsibility Allowance (8,000 x 12)
96,000.00
House Help Allowance (5,000 x 12)
60,000.00
Inconvenience Allowance (2,500 x 12)
30,000.00
Children’s Education (1,000 x 12)
12,000.00
Risk Allowance (1,200 x 12)
14,400.00
Overtime
15,000.00
Excess Bonus (108,000 – 40,500)
67,500.00
Educational Support
4,800.00
Total Cash Emolument
299,700.00
607,700.00
Benefits in Kind:
Vehicle element (10% x 607,700)
60,770.00
Restricted to (1,250 x 12)
15,000.00
Rent Element (10% x 607,700)
60,770.00
Source deduction (500 x 12)
(6,000.00)
54,770.00
Assessable Income
69,770.00
677,470.00
Allowable Deductions:
Marriage Relief:
Child Education
1,200.00
(600 x 3)
1,800.00
Aged Dependent
2,000.00
Employee’s Contribution:
SSF
(5.5% x 308,000.00)
16,940.00
Provident Fund (6.5% x 308,000.00)
20,020.00
Chargeable Income
41,960.00
635,510.00
CHARGEABLE INCOME
Rate (%)
Tax Amt
CCI
CTA
First
4,824
0
0.00
4,824.00
0.00
Next
1,320
5
66.00
6,144.00
66.00
Next
1,560
10
156.00
7,704.00
222.00
Next
36,000
17.5
6,300.00
43,704.00
6,522.00
Next
196,740
25
49,185.00
240,444.00
55,707.00
Next
359,556
30
107,866.80
600,000.00
163,573.80
Exceeding
35,510
35
12,428.5
640,510.00
176,002.30
176,002.30
Tax on Bonus
2,025.00
Tax liability payable
173,977.30
QUESTION EIGHT
(GROUP FIVE)
a) ZITA & WISDOM Company Limited produces tomato paste under the 24-Hour Economy policy of the
Government of Ghana. It commenced operations on 1st April 2021 preparing its financial statements to
31st December each year.
The company acquired the following assets for the business on 1st March 2021:
Quantity
Description
Total Amount GHȼ
10
Computers & Accessories
1,200,000
1
Factory Building
1,800,000
2
Plant and Machinery
2,400,000
5
Office Cabinets
120,000
3
Air Conditioners
160,000
1
Toyota Corolla Saloon Car
120,000
1
Standing Fan
6,000
8
Office Furniture
260,000
The company acquired the following additional assets for the business on 1st July 2022.
One (1) Standing Fan valued at GHȼ7,000
One (1) Toyota Fortuner (2021 Model) Car Valued at GHȼ140,000.
Two (2) Air Conditioners valued at GHȼ60,000
(i)
(ii)
(iii)
The following assets were disposed off for cash in June 2023:
(i)
(ii)
The Ten (10) Computers and Accessories
The Two (2) standing Fans
GHȼ
400,000
5,400
The Company acquired the following assets for the business on 1st November 2023:
GHȼ
1 Toyota Corolla Saloon Car
110,000
2 Photocopiers
6,000
1 Long Trailer Vehicle
2,400,000
One of the company’s saloon cars was involved in an accident in January 2023. The Company received
GHȼ60,500 from LP Insurance Company Ltd as compensation in the same year of assessment.
In 2024, one (1) plant and machinery was exchange for a Trademark value at GHȼ1,500,000 which will be used
by the company for fifteen (15) years with effect from 2024. Additionally, an improvement cost of GHȼ700,000
in respect of the other plant and machinery was incurred in 2024.
Required
Compute the Capital Allowances for all relevant years of assessment.
Suggested Solution
CAPITAL ALLOWANCE CALCULATION
2021
1/1/21-31/12/21
Computers
CLASS 1
CLASS 2
CLASS 3
CLASS 4
CLASS 5
40%
30%
20%
10%
15 Years
1,200,000
Factory Bui
1,800,000
Plant & Mach.
2,400,000
Office Cabinet
120,000
Air conditioners
160,00
Toyota-Saloon car
2022
6,000
Office furniture
260,000
1,200,000
2,475,000
546,000
1,800,000
CA (275/365) (361,643.84) (559,417.81) (82,273.97)
(135,616.44)
WDV c/d
838,356.16
1,915,582.19 463,726.03
1,664,383.56
838,356.16
1,915,582.19 463,726.03
1,664,383.56
(1,138,952.05)
1/1/22-31/12/22
WDV b/d
Additions
75,000
838,356.16
2023
75,000
Standing Fan
TOTAL
TOTAL
67,000
1,990,582.19 530,726.03
1,664,383.56
CA
(335,342.47) (597,174.66) (106,145.21) (180,000)
WDV c/d
503,013.70
1,318,407.53 357,580.82
1,484,383.56
WDV c/d
503,013.70
1,318,407.53 357,580.82
1,484,383.56
Disposals
(400,000)
(60,500)
(5,400)
2,475,000
6,000
1/1/22-31/12/22
Additions
Total
103,013.70
3,732,907.53 358,180.82
-
1,484,383.56
(1,218,662.33)
CA
Additional CA
(1,119,872.26) (71,636.16)
(180,000)
(1,412,713.90)
61,808.22
2,613,035.27 286,544.66
1,304,383.56
(61,808.22)
(61,808.22)
WDV c/d
2024
(41,205.48)
(1,474,522.12)
0.00
2,613,035.27 286,544.66
1,304,383.56
0.00
2,613,035.27 286,544.66
1,304,383.56
1/1/24-31/12/24
WDV b/d
Additions
1,500,000
Disposals
(1,500,000)
Totals
0.00
1,113,035.27 286,544.66
1,304,383.56 1,500,000
CA
0.00
(333,910.58) (57,308.93)
(180,000)
WDV c/d
0.00
779,124.69
1,124,383.56 1,400,000
Excess of 5% Rep & Impro
661,043.77
Additional Capital
198,313.13
229,235.73
Total CA for 2024
WDV c/d
100,000
(671,219.51)
(198,313.13)
(869,532.64)
0.00
1,241,855,33 229,235.73
1,124,383.56 1,400,000
b) You are required to explain how the following persons would be taxed by MYTURN Construction Ltd,
a construction company working on the Tamale - Yendi Road under Act 896.
i. Casual Workers
ii. Temporary Workers
iii. Project consultants (not in the employment of the company)
Suggested Solution
Casual Workers
Where a person makes payment to a casual worker, that payment shall be treated as income earned by that
casual worker, and the person shall withhold tax from the gross income paid to that casual worker at the rate of
five percent (5%). The tax withheld shall be treated as a final tax. A casual worker has the meaning assigned in
section 78 of the Labour Act, 2003 (Act 651) and Practice Note on Gains or Profits from Employment.
Temporary Workers
Where a person makes payment to a temporary worker as defined under section 78 of the Labour Act, 2003
(Act 651), that payment shall be treated as income earned by that temporary worker, and the person shall
withhold tax from that income in accordance with section 114 of the Act 896 and the First Schedule to the Act
896.
Project Consultants
Supply of service means the furnishing of labour, time, or effort not involving the delivery of a specific end
product other than reports, which are merely incidental to the required performance; and includes consulting,
professional and technical services but does not include employment agreements or collective bargaining
agreements. Therefore, it will attract withholding tax of 7.5%.
QUESTION NINE
(GROUP SEVEN)
a) Asak-boyine and Gilson, who are cousins, have been in partnership for several years trading in secondhand clothing. Their accounts are prepared to 31st December each year.
Their partnership agreement is varied each year according to the prevailing economic circumstances.
Details of the 2023 agreement are as follows:
Asak-boyine
Gilson
Profit sharing ratio
3
2
GHȼ
GHȼ
Salaries
per month
2,000
1,800
Transport allowance
per month
600
400
Rent allowance
per month
1,200
800
House help allowance
per month
500
400
These were charged in the accounts in arriving at a net profit of GHȼ48,000. The following expenses
were also charged in the accounts: GHȼ
(a) Administration
3,500
(b) Miscellaneous
1,300
(c) Donations
1,000
(d) Medical
4,200
(e) Depreciation
1,100
Breakdown is as follows:
a) Administration
GHȼ
b) Miscellaneous
GHȼ
Penalty for late filling
1,100
Cleaning expenses
900
Withholding tax paid
1,500
Data for Internet
400
Distribution costs
900
1,300
3,500
c) Donations
GHȼ
d) Medical
GHȼ
Alma-Mater
500
Partners
1,200
Assemblies of God
500
Children
3,000
1,000
4,200
Asak-boyine and Gilson are both married and have a child each at Accra Academy Senior High School. The
cost of assets used in the business as at 1st January, 2023 were as follows:
GHȼ
Saloon Car
79,000
Furniture and Fixtures
8,000
A saloon car was purchase in April, 2023 values at GHȼ55,000.
Required:
Compute the chargeable income and tax liabilities of the partners for the year 2023
Suggested Solution
A) COMPUTATION OF PROFIT
Profit per account
Add Back:
Depreciation
1,100.00
Donation
1,000.00
Administration
2,600.00
Medical
4,200.00
Less Capital Allowance
Adjusted Profit
48,000.00
8,900.00
56,900.00
(40,600.00)
16,300.00
COMPUTATION OF CHARGEABLE INCOME
Y / A – 2023
BP – 1/1/23 – 31/12/2023
Asak-Boyine
Profit / Loss
9,780.00
Salary
24,000.00
Transport
7,200.00
Rent
14,400.00
Houseboy
6,000.00
61,380.00
Less Reliefs / deductions:
Marriage
1,200.00
Children Education
600.00
1,800.00
Chargeable Income
59,580.00
Computation of Capital Allowance
Class 2
Cost
75,000.00
Addition
55,000.00
Class 3
8,000.00
-
Gilson
6,520.00
21,600.00
4,800.00
9,600.00
4,800.00
47,320.00
1,200.00
600.00
1,800.00
45,520.00
Total
Capital Allowance
WDV c/d
130,000.00
39,000.00
91,000.00
8,000.00
1,600.00
6,400.00
40,600.00
Tax Liability of Asak-Boyine
First
Next
Next
Next
Next
4,824
1,320
1,560
36,000
15,876
0
5
10
17.5
25
0
66
156
6,300
3,969
4,824
6,144
7,704
43,704
59,580
0
66
222
6,522
10,491
4,824
6,144
7,704
43,704
45,520
0
66
222
6,522
6,976
Therefore, Asak-Boyine tax liability is GHS10,491.00
Tax liability of Gilson
First
Next
Next
Next
Next
4,824
1,320
1,560
36,000
1,816
0
5
10
17.5
25
0
66
156
6,300
454
Therefore, Gilson tax liability is GHS6,976
b) Taxation of gains from the realization of assets and liabilities is an important element of any income tax
system.
Required:
What constitutes realization in light of section 38 of Act 896?
Suggested Solution
b) Under Section 38 of Act 896 realization of an asset occurs, in the case of:
A person parting with ownership of the asset, including when the asset is sold, exchanged, transferred,
distributed, cancelled, redeemed, destroyed, lost, expired or surrendered;
An asset of a person who ceases to exist, including by reason of the death of an individual;
An asset other than trading stock or a depreciable asset, where the sum of consideration received from owning
the asset exceeds the cost of the asset;
An asset that is a debt claim owned by a person other than a financial institution, the person reasonably believes
the debt claim will not be satisfied, the person has taken all reasonable steps in pursuing the debt claim and the
person writes the debt off as bad;
Trading stock, a depreciable asset, a capital asset of a business or investment asset, immediately before the
person begins to employ the asset in such a way that it ceases to be an asset of any of those types; etc
Resident person becoming a non-resident person;
Where the underlying ownership of an entity changes by more than 50% at any time within a period of three
(3) years, the assets and liabilities of that entity immediately before the change is deemed to be realized.
QUESTION TEN
(GROUP SIX)
On March 1, 2021, ADAGYINE Company Ltd. hire Mr. Felix (Non-Resident), a Jamaican amputee, as a mining
engineer on a salary scale of GHȼ240,000 x GHȼ5,000 - GHȼ300,000. Felix has never visited Ghana before.
His sole purpose for being in Ghana is to work for Adagyine Company Ltd. Given the length of the employment,
Felix travelled to Ghana with his wife and their three beautiful children, Asak, Rosa and Gilly. As part of the
employment requirements, Adagyine Company Ltd incurred GHȼ98,000 as Mr. Felix’s and his family’s air
ticket, visa, and medical costs. Twenty-five (25%) of the total sum is the cost of Felix’s travel, with the
remaining portion going toward the family’s expenses. The total amount of GHȼ98,000 was reimbursed on 1st
July, 2023.
His service conditions include the following allowances:
a) 7.5% of his basic salary as duty rent allowance
b) 15% of his basic salary as responsibility allowance
c) 2.5% of his basic salary as risk allowance
d) Unaccountable entertainment allowances of GHȼ4,000 per annum
e) Bonus of 28% of his basic salary
f) Garden boy allowances of GHȼ500 per quarter paid directly to Felix
g) Two maidservants each on wages of GHȼ4,200 per annum. The amount is paid to the maid servants
directly by the company
h) The company provided him with a soft furnished accommodation for which GHȼ800 is deducted from
source every month
i) He was provided with driver, vehicle with fuel for both official and private use
j) He contributed 5.5% of his salary towards the social security funds and the employer contributes 13%
k) He was appointed a director of Esi Ltd and was paid a total of GHȼ50,700 net of 20% withholding tax
in 2023 year of assessment as director’s emolument
l) He earned dividend of GHȼ19,500 (net) on his investment in VEMAX Ltd.
m) He also engaged in trading activities which earned him an agreed chargeable income with the GRA of
GHȼ48,000 in year of assessment. He paid GHȼ6,000 tax to the GRA on his trading activities for the
2023 year of assessment
n) His employers deducted a tax of GHȼ28,000 from his salary and paid to the GRA for 2023 year of
assessment
o) He received a loan of GHȼ10,000 at a rate of 10% payable within 18 months, effective 1st July, 2023.
Assume that the statutory rate is 20% p.a.
p) He donated GHȼ9,000 to Ghana Black Stars during the 2023 AFCON
q) GHȼ2,000 monthly deduction is made at source for his mortgage interest
r) Special retirement package of which he contributes 5% of his basic salary, which the company pays
14% of his basic salary. The special retirement scheme has been approved by the National Pensions
Regulatory Authority (NPRA).
s) He has two wives and six children. Two of the children are offering BSc. Accounting at University of
Ghana, while the other four are in approved basic schools in Ghana. He has full responsibility over his
family and his aged mother and father. He remits GHȼ2,000.00 to each of his parents, every month.
t) His salary for December, 2023 was paid in January, 2024.
Use the appropriate Personal Income Tax Schedule for chargeable income of resident individual, however, the
chargeable income of non-resident individuals is generally taxed at a flat rate of 25%.
Required
i.
Compute Mr. Felix’s Chargeable Income for 2023 Year of Assessment
ii.
Determine his tax liability for the year
iii.
Determine his net tax payable
Suggested Solution
Mr. Felix
Computation of Chargeable Income for the 2023 Year of Assessment
GHȼ
GHȼ
GHȼ
Basic Salary
222,916.66
Add Cash Benefits and Allowances:
Rent Allowance (7.5% x 222,916.66)
16,718.75
Responsibility Allowance (15% x 222,916.66)
33,437.50
Risk Allowance (2.5% x 222,916.66)
5,572.92
Unaccountable Entertainment Allowance
4,000.00
Bonus (13% x 222,916.66)
28,979.17
Passage Cost
73,500.00
Garden Boy Allowances (500 x 4)
2,000.00
Excess -Retirement Contribution (2.5% x 222,916.66)
5,572.92
Maidservant Allowances (4,200 x 2)
8,400.00
178,181.26
Total Cash Emolument
401,097.92
Add Benefits in Kind:
Rent element (10% x 401,097.92) – (800 x 12)
30,509.79
Car element (10% x 401,097.92)
40,509.79
Restricted to (1,250 x 12)
15,000.00
Loan Benefits
125.00
45,634.79
Total Assessable Income from Employment
446,732.71
Less reliefs and Deductions:
SSF Employee (5.5% x 222,916.66)
12,260.42
Special Provident (5% x 222,916.66)
11,145.83
Mortgage Interest (2,000 x 12)
24,000.00
Donation
9,000.00
Marriage Relief
1,200.00
Child Education (600 x 3)
1,800.00
Aged Dependent (2 x 1,000)
2,000.00
Disability Relief (25% x 446,732.71)
111,683.18
173,089.43
Chargeable Income from Employment
273,643.28
Add Other Incomes
Directors Emoluments
63,375.00
Business Income
48,000.00
Total Chargeable Income
385,018.28
First
4,824
0
0
4,824
0
Next
Next
Next
Next
Next
1,320
1,560
36,000
196,740
144,574.28
5
10
17.5
25
30
Tax liability from PAYE
Less Payment on Account:
Director emolument
Withholding tax on Business
Withholding Tax on PAYE
Taxable to the GRA
66
156
6,300
49,185
43,372.28
6,144
7,704
43,704
240,444
385,018.28
GHȼ
GHȼ
99,079.28
12,675
6,000
28,000
66
222
6,522
55,707
99,079.28
46,675
52,404.28
workings
Y / A – 2023
Basis Period: 1/1/2023 – 31/12/2023
YA
Basis Period
Amount GHȼ
2022
1/03/2021 – 28/02/2022
240,000.00
2023
1/03/2022 – 28/02/2023
245,000.00
2/12 x 245,000 = 40,833.33
2024
1/03/2023 – 28/02/2024
250,000.00
10/12 x 250,000 = 208,333.33
Basic salary for 2023 (1/1/2023 – 31/12/2023)
249,166.66
Basic salary for December = 1/12 x 255,000 = 21,250
Consolidated Basic salary for 2023 YA = 249,166.66 – 21,250 = 222,916.66
Loan Benefits
A
= 10 % x 10,000 = 1,000
B
= 20% x 10,000 = 2,000
C = ¼ (B – A) = ¼ (2,000 – 1,000) = 125.00