Hardship relief board
We do not like paying taxes. We do not
feel good when we see that so much has been deducted from our pay or
when so much is added as tax on goods we purchase.
We simply have no choice but to pay whatever is calculated as tax.
Unfortunately, this is one of two things that we as human beings have
to do while we are alive.
We will continue to pay tax for as long as we live and that will end
on the day we die. There are of course very good reasons why
Governments impose taxes.
You can make a long list of things that the Government does with the
money we pay as tax and includes provision of education facilities,
hospitals, roads, salaries for public servants, etc.
If you are running a small business and are registered with the
Investment Promotion Authority, you will be required to have a tax
file number.
The IRC will issue you the relevant forms to complete details of your
business on the form.
In doing so, your business would now be within the tax net and the IRC
would issue you assessment notices based on the returns you have
lodged for your business.
The notice will tell you how much tax your business should pay for the
profits it has made for a particular year.
If you have made allowance for tax and have cash in the bank, then you
would have no problem.
You should write out a cheque for the amount of tax your business is
liable to pay for that year of income.
What happens if you are not able to pay all or the full amount of tax
on the income your business has made for that year?
To avoid the possibility of the IRC garnisheeing your bank accounts,
you can write to the Commissioner General with a proposal for
instalment payments.
The Commissioner General has a discretion whether to accept your
proposal or not. In most cases, such proposals for instalment payments
would be accepted.
The situation is slightly different in a situation where you are a
sole trader or are in receipt of income from other sources such as
dividends or royalties.
For example: You have an outstanding tax liability but you are in no
position to make any arrangements for instalment payments. You do not
have any means or very little, if any, to pay off your tax liability.
You are faced with extreme or serious financial hardships. What do you
do?
It is possible that you may be released either wholly or in part from
your tax liability. In
other words, you can be freed from paying your taxes. The only
authority to do that is the Hardship Relief Board.
The Hardship Relief Board comprises of the Commissioner General, the
Commissioners of Customs and Taxation and the Secretary for Finance or
their nominees.
You have to show to the satisfaction of the Board that you are in a
situation where the imposition of the full amount of tax on you may
cause you financial hardship and for the Board to release you from the
whole or any part of the tax.
As long as you are able to show that you just cannot pay your tax
liability, the Board should release you from your tax liability. It
will take a lot of convincing to do that.
If the taxpayer has died and you are the beneficiary of the deceased
person’s estate, then you can also have recourse to this relief. The
Board can release the trustee of the estate of the deceased taxpayer.
If your tax liability is less than K1,000, you can write directly to
the Commissioner General to release you from that liability.
Again, you have to show him why it is that you cannot pay of that
liability. He is not required to refer tax liability of amounts less
than K1,000 to the Board.
by MARK OPUR
