Verified Facts
The tax rates in Ghana range from 5% to 25% for personal income tax, with a corporate tax rate of 25%, a Value-Added Tax (VAT) rate of 12.5%, and a capital gains tax rate of 15% for resident individuals, which is included in their income tax.
Tax laws change frequently. Always consult a qualified tax professional for advice specific to your situation. This is a general guide only.
Quick Facts
Tax System Overview
Ghana has a territorial tax system, where residents are taxed on their worldwide income, while non-residents are taxed only on their Ghana-sourced income. To be considered a tax resident in Ghana, an individual must have a permanent home in the country and be present for at least 183 days in a year, or have a permanent home in Ghana and be present for at least 122 days in a year for at least three consecutive years. The tax system in Ghana is administered by the Ghana Revenue Authority (GRA), which is responsible for collecting taxes, customs duties, and other levies.
The tax year in Ghana runs from January to December, and taxpayers are required to file their tax returns by April 30th of the following year. Taxpayers can file their returns electronically or manually, and they must also pay their taxes electronically or through authorized banks. The GRA has introduced various initiatives to simplify the tax filing process and encourage compliance, including the use of tax identification numbers and the introduction of a tax amnesty program for taxpayers who have not filed their returns in the past.
Personal Income Tax
| Income Bracket (GHS) | Tax Rate |
|---|---|
| 0 - 3,816 | 5% |
| 3,817 - 7,632 | 10% |
| 7,633 - 11,448 | 15% |
| 11,449 - 22,896 | 20% |
| 22,897 and above | 25% |
| Taxpayers in Ghana are entitled to various deductions and allowances, including a personal relief of GHS 1,200 per month, a dependent relative allowance of GHS 1,200 per month, and a mortgage interest relief of up to GHS 10,000 per year. Taxpayers are required to file their tax returns annually, and they must also pay their taxes in four equal installments by March 31st, June 30th, September 30th, and December 31st of each year. Failure to file tax returns or pay taxes on time can result in penalties and interest, including a late filing penalty of GHS 500 and a late payment penalty of 3% per month. |
Corporate & Business Tax
- The corporate tax rate in Ghana is 25% for both resident and non-resident companies.
- Small businesses with an annual turnover of less than GHS 200,000 are exempt from paying corporate tax, but they must still file their tax returns and pay Value-Added Tax (VAT).
- Companies operating in free zones are exempt from paying corporate tax for 10 years, but they must still pay a withholding tax of 8% on dividends and interest.
- Companies must register with the GRA within 30 days of commencing business, and they must also obtain a tax clearance certificate before they can operate in Ghana.
- Companies must file their tax returns annually, and they must also pay their taxes in four equal installments by March 31st, June 30th, September 30th, and December 31st of each year.
VAT / Sales Tax
- The standard VAT rate in Ghana is 12.5%, which applies to most goods and services.
- A reduced VAT rate of 3% applies to the supply of certain basic necessities, including food, water, and medicine.
- Exemptions from VAT include the supply of financial services, education, and healthcare.
- Tourist refund schemes are available for foreign tourists who purchase goods and services in Ghana, but they must meet certain conditions, including spending at least GHS 100 in a single transaction.
For Expats & Foreign Workers
- Tax residency rules apply to expats and foreign workers who are present in Ghana for at least 183 days in a year, or who have a permanent home in Ghana and are present for at least 122 days in a year for at least three consecutive years.
- Ghana has double taxation treaties with 11 countries, including the UK, USA, and Canada, which help to prevent double taxation and fiscal evasion.
- Expats and foreign workers are required to register with the GRA and obtain a tax identification number before they can work in Ghana.
- Expats and foreign workers are entitled to social security benefits, including a pension and healthcare, but they must contribute to the social security fund.
- Expats and foreign workers must comply with remittance rules, which require them to remit their taxes and social security contributions to the GRA.
- Expats and foreign workers who are employed by a foreign employer may be exempt from paying tax in Ghana, but they must meet certain conditions, including being present in Ghana for less than 183 days in a year.
Crypto & Investment Income
- Investment income, including dividends, interest, and rent, is subject to tax in Ghana, and taxpayers must declare their investment income on their tax returns.
- Cryptocurrency is not recognized as a legal tender in Ghana, but it is subject to tax, and taxpayers must declare their cryptocurrency income on their tax returns.
- Capital gains tax applies to the disposal of assets, including shares, property, and investments, and taxpayers must declare their capital gains on their tax returns.
- Taxpayers who earn foreign-sourced income must declare their income on their tax returns and pay tax on it, but they may be entitled to a foreign tax credit if they have paid tax on the income in another country.