Insurance firms that fail to collect or file the right amount of taxes withheld on the VAT on Non-Life Insurance premiums will be punished and compelled to pay penalties, the Ghana Revenue Authority (GRA) has warned.
According to the GRA, compliance mechanisms have been put in place to ensure that the necessary revenue is accrued.
Chief Revenue Officer of Policy and Programmes at the GRA, Sugar Adokunu in an interview on the AM Show on Joynews disclosed that all penalties in the VAT laws will be borne by companies that flout the law.
The 15 percent VAT on Non-Life Insurance commenced on July 1, as part of measures by the GRA to boost revenue.
“There is a penalty in the VAT laws which will apply and the insurance company will be made to pay. There is another additional GH₵10 per day penalty that will be charged, so it is all part of the law”, he said.
The 15 percent VAT on Non-Life is part of revenue measures including the 5 percent VAT on rental properties for the second half of the year to boost domestic revenue.
VAT on Non-Life Insurance refers to the 15% Value Added Tax applied to premiums paid on general insurance policies such as fire, marine, travel, burglary, property, personal accident, liability, and workmen’s compensation insurance. These policies offer protection against risks other than death or permanent disability and are classified as taxable supplies under the VAT Act, 2013 (Act 870), as amended.
VAT on Non-Life Insurance policies in Ghana is charged at a rate of 15% with Insurance providers responsible for applying this VAT on applicable premiums and remitting it to the Ghana Revenue Authority (GRA).
Motor insurance, however, remains exempt under the VAT (Amendment) Act 2023, (Act 1107) due to its compulsory nature and the need to ensure affordability and accessibility for vehicle owners.
DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.
DISCLAIMER: The Views, Comments, Opinions, Contributions and Statements made by Readers and Contributors on this platform do not necessarily represent the views or policy of Multimedia Group Limited.
