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- 5 Marks
Question
Abah Enterprise is a small business but intends to bid for government contracts. It has a very small cash flow, with turnover unable to be registered under the compulsory registration arrangement for Value Added Tax. The proprietor of Abah Enterprise feels that if the enterprise is not registered for Value Added Tax, it will be difficult to be able to bid for government contracts.
Required:
Under what condition can Abah Enterprise apply to Ghana Revenue Authority for Value Added Tax Registration without meeting the threshold registration requirements under section 6 of the Value Added Tax Act 2013 (Act 870)?
(5 marks)
Answer
Abah Enterprise can apply for VAT registration without meeting the threshold if the following conditions are met:
Fixed Place of Abode or Business: The business must have a permanent and identifiable place of operation.
Reasonable Grounds for Belief: There should be reasonable grounds to believe that the business may soon meet the VAT registration threshold.
Proper Accounting Records: The business must maintain proper accounting records related to its operations.
Regular and Reliable Tax Returns: The business must submit regular and reliable tax returns as required by the Ghana Revenue Authority.
Fit and Proper Person: The proprietor must be deemed a fit and proper person to be registered for VAT.
(5 points @ 1 mark each = 5 marks)
- Tags: Small Business, Tax Administration, Threshold, VAT Registration
- Level: Level 2
- Topic: Value-Added Tax (VAT), Customs, and Excise Duties
- Series: MAY 2020
- Uploader: Cheoli