Landlords Accused Of Not Paying Property Returns

By Stephen Kwabena Effah
Friday, 27 April 2007

A Deputy Commissioner of the Internal Revenue Service (IRS), John E.K Sotenga, has expressed concern about non compliance of returns on properties and rent incomes by some landlords.

He indicated that only 60 per cent of landlords pay tax on their properties and rent incomes in the country, adding, "self-compliance level is low. Quite a number of land lords are not coming."

Speaking at the third Revenue Week of the IRS on Wednesday, Mr.Sotenga said returns on properties and rent forms about five per cent of income taxes collected by the IRS.

Under the IRS Act 592 (2000), any person who earns income from rent is expected to furnish the IRS Commissioner with a return on the gross income the end of the year of assessment.

The seminar which was attended by directors, business executives, professional bodies, tax practitioners, accountants, auditors and pay masters, was aimed at making them understand their rights as tax payers and also the various penalties applicable to non compliance with tax laws.

Failure to pay returns within three months, he said attracts a 10 per cent penalty of the amount due and after three months, it attracts 20 per cent of the amount due.

He therefore appealed to land and property owners to comply with that aspect of the law which, he noted, many people are not aware of.

He said the IRS regularly carries out rent survey to improve property and rent tax in the country.

The Deputy Commissioner conceded that a number of Ghanaians are not conscious of section 108 of the IRS Act 592 which requires gifts to be taxed, saying that gifts received are supposed to be declared to the IRS for appropriate taxation.

He said because it is difficult to establish a mechanism to check non- compliance, many people are avoiding it but noted that it is along the line found as an individual submit returns on capital gains.

The Commissioner of IRS, Maj. Daniel S.Ablorh-Quarcoo (Rtd), advised tax administrators to share always accurate information with the IRS and co-operate with the service officials.

He observed that, often times, tax payers do not provide enough information to the IRS for appropriate taxation and therefore advised them against such acts.