A GUIDE TO TAX STAMP

1.

INTRODUCTION

Charge To income Tax The Internal Revenue Act, 2000(Act. 592) charges any person who earns income from employment, business and investment to pay tax on a yearly basis. This enables the State to provide for social services, infrastructure, education and other services for the benefit of all Ghanaians. The Year of Assessment is 1st January-31st December of the same year. 2.0 WHAT IS THE TAX STAMP? The Tax Stamp system was introduced by the Internal Revenue (Amendment) Regulations, 2004. The system came into effect on Tuesday the 1st of February, 2005. It allows for easy identification of small-scale self-employed persons in the informal sector e.g. persons operating in kiosks, on table tops, identifiable groups such as hairdressers, dressmakers and tailors, butchers, market traders, chop bar and cooked food sellers, artisans such as masons carpenters, welders, mechanics e.t.c

3.0 WHO MUST BUY THE TAX STAMP? Under the Tax Stamp System, business operators in the informal sector are grouped according to the business type and volume. The tax is paid quarterly in advance i.e. 15th January, 15th April, 15th July and 15th October.

3.1 HOW ARE THE TRADERS CLASSIFIED? Traders are classified according to the size and Volume of business activities as follows:
Class of Person Type 2 Sub-Class of Persons DRESSMAKER/ TAILOR Category A- Large Kiosk B Medium C -Small Rate GH 15 10 5

Type 3

SUSU COLLECTORS Category A- Cities B- Urban C- Rural CHOP BAR OWNERS/ COOKED FOOD SELLERS Category A- Large Kiosk B- Medium C - Small D - Table Top

15 10 5

Type 4

15 10 5 3

Type 5

Type 6

BUTCHERS Category A- Large Kiosk B Medium C Small D Table Top HAIRDRESSERS & BEAUTICIANS/ BARBERS Category A- LargeKiosk B-Medium C- Small GARAGE OWNERS Category A -Cities B -Urban C Rural

15 10 5 3

15 10 5

Type 7

15 10 50

Type 8

DIAMOND/GOLD WINNERS&BUYERS Category A- Licensee B -Sub Agent

15 10

40 footer kiosk

container/large 15 10

20 footer container/ medium kiosk operators Small kiosk /container operators / market stalls and itinerant traders Table Top operators/ hawkers

4.0 AS A SMALL SCALE SELF-EMPLOYED UNDER THE TAX STAMP REGIME WHAT ARE MY OBLIGATIONS? As an operator in the informal sector affected by the Tax Stamp system you have two obligations: 4.1 You must buy the Tax Stamp on or before 15th January, 15th April, 15th
July

and 15th October of each year. The Tax Stamps are available at the IRS District Office in your District. 4.2 You must display the Tax Stamp at a conspicuous place on the premises of your business. You may also choose any way to display the Tax Stamp as long as it is easily visible at the place of your business. 4.3 HOW DO I DISPLAY THE TAX STAMP AS A HAWKER/TABLE TOP OPERATOR? In the case of hawkers/table top operators, it is recommended that the Tax Stamp be kept in a plastic sheath and carried on your person at all times for inspection at any time.

5.0 WHAT DOES A TAX STAMP LOOK LIKE? The shape of a Tax Stamp is circular. The features include the name of the taxpayer, the amount paid, the period in respect of which the payment is made and other particulars. It is also security marked. 6.0 AM I OBLIGED TO BUY A TAX STAMP? Yes, every small-scale self - employed person is required to buy the Tax Stamp. Any small-scale self-employed person who fails to pay tax or fails to produce Tax Stamp for inspection commits an offence and is liable on summary conviction to a fine not less than GH200 and not more than GH 500 7.0 WHAT RELATION IS THERE BETWEEN A TAX STAMP AND THE INCOME TAX I FINALLY NEED TO PAY? Tax payers are to note that payment of the Tax Stamp is on account. It is not a final tax. Tax payers are to file their returns at the end of each calendar year but not later than 30th April of the following year. 8.0 WHAT BENEFITS ACCRUE TO ME WHEN I BUY THE TAX

STAMP? - You have the peace of mind to pursue your business activity uninterrupted. -You are known to the Tax Authority and can therefore apply for Tax Reliefs. -You can easily obtain a Tax Clearance Certificate when the need arises.

9.0Therefore, keep all your receipts and tax stamps and add to your application to the tax office. These notes are for guidance only and reflect the tax laws at the time of writing

For further assistance on tax stamp, Please contact: IRS Head Office, Starlets 91 road, (Opposite Ohene Djan Sports Stadium) P.O. Box 2202, Accra ,Ghana Tel: +233-(0)21 675701-10 Fax: +233 (0)21-664938 Email: info@irs.gov.gh website: www.irs.gov.gh Toll free: 0800-21010 IRS- Your Partner in National Development