Modified Taxation

Modified taxation seeks to rope in taxpayers from the informal sector into the tax net. The rationale is to promote voluntary compliance and expand the tax base.

No, it is a Personal Income Tax for operators in the informal sector.

To qualify, an individual must:

1. Be a resident of Ghana.
2. Earn income exclusively from business.
3. Earn income only from sources within Ghana.

• Ease of registering for the tax
• Ease of computing the tax.
• Ease of filing
• Ease of paying the tax.

The scheme is targeted at small businesses like you to contribute to the development of the nation as part of your civic responsibility

The implementation takes effect from 1st July 2025

Individuals must file a simplified tax return within four months after the assessment year ends in a form and manner determined by the Commissioner- General.

To register under modified taxation, individuals must provide:

1. National Identification Card (Ghanacard)
2. GhanaPost GPS Address (Digital Address)
3. Phone Number
4. Turnover (sales figure)
5. Business Registration/Permit Documents (if applicable)

There are three main categories:

Presumptive Tax Based on Turnover (PTT) – Tax payments based on a 3% flat rate of your annual turnover. Here, the turnover is more than GHC 20,000 but less than GHC 500,000.
Modified Cash Basis (MCB) – Tax payments using cash basis accounting with modifications. Here, the turnover is also more than GHC 20,000 but less than GHC 500,000 with minimum allowable deductions. We use the graduated rate to calculate the tax.

The turnover is sales amount for goods sold or services rendered. This can be daily, weekly, monthly, quarterly or annual sales.

You are expected to pay taxes on quarterly basis. However, daily, weekly, monthly and annual payments are allowed.

The GRA offers multiple payment options:
USSD Payments: A dedicated short code for mobile tax payments.
Mobile Money Payments: Offline payments via designated mobile money agents.
Bank Payments: Traditional bank deposits with reference numbers.

You are to keep daily sales records to facilitate fair assessment and compliance

Yes, we encourage those who belong to identifiable groups to do bulk registrations

The GRA provides multiple registration options for accessibility:

MTS Portal: An online platform integrated into the Core Domestic Tax Application for electronic registration.
Mobile App: A user-friendly app for registration via smartphones.
GRA Offices: In-person registration assistance at designated offices.
Mobile Registration Units: Deployed to communities for individuals with limited internet access.
Bulk Registration: Used in collaboration with agencies to register members in bulk.

The following individuals do not qualify for presumptive taxation:

1. Professionals with formal qualifications (e.g., accountants, lawyers, engineers).
2. Individuals engaged in businesses with high profit-to-turnover ratios, as prescribed by regulations.
3. Individuals operating more than one business.
4. Individuals with businesses that have multiple outlets.
5. Partners in a business partnership.
6. Individuals who voluntarily opt out of presumptive taxation.

These persons fall under the Modified Cash Basis.