Ghana introduces real-time VAT collection for digital services — MyJoyOnline
In Ghana, the Ghana Revenue Authority (GRA) has introduced a real-time VAT collection mechanism for cross-border digital services. The RTVAT system applies to transactions in which payment is made using a payment instrument issued in Ghana to a non-resident seller providing a service electronically, MyJoyOnline reports.
The GRA emphasized that RTVAT is not a new tax, but a mechanism for the prompt collection of VAT already payable on such transactions. The customer pays an amount inclusive of VAT, after which the tax component is automatically separated and transferred to the GRA. Customers are to be notified of the VAT deduction via SMS.
Services covered by the mechanism
The rules apply to online subscriptions and streaming services, including Netflix, HBO, Apple TV and Amazon Prime, Microsoft Azure and Google Cloud services, online games, digital marketplaces, advertising and other digital services. Three conditions must be met simultaneously for RTVAT to apply: the payment instrument must be issued in Ghana, the seller must be a non-resident, and the service must be provided electronically.
More current news is available on the UA.News Telegram channel Telegram.
The rate is 15% VAT and a combined 5% levy for GETFund and NHIL, bringing the total to 20%. If the non-resident is already registered as a VAT payer, the buyer should not pay the tax to the seller again. The supplier must state the price excluding VAT and notify customers that the tax will be collected at the time of payment.
Obligations of suppliers and payment institutions
All non-residents supplying taxable digital services to consumers in Ghana must register as VAT payers regardless of their transaction volume. Real-time collection does not exempt them from the obligation to file periodic VAT returns.
Banks, payment service providers, electronic money issuers, third-party payment providers and other licensed institutions processing relevant transactions must integrate with the RTVAT platform and transfer the tax to the GRA. According to the authority, around 167 non-resident e-commerce companies are registered in the country, mobilizing an average of 43 million Ghanaian cedis per month and generating an estimated 515 million cedis in VAT annually.
