College of Humanities University of Ghana Business School Department of Accounting ACCT 405 TAXATION Session 4 – Allowable and Disallowable in Taxation
Session Overview Lesson Objectives: By the end of this section you should be able to: • Describe the general principle for a deductible expenses in taxation • Categorize expenses in taxation • Identify expenses deductible from assessable income • Identify disallowable expenses Prof. M. Amidu, Dr. I. Bedi & Mr. A. Ali-Nakyea
Session Outline The key topics to be covered in this session are as follows: • Allowable expenses • Disallowable expenses • Repairs and Improvement • Financial Cost Prof. M. Amidu, Dr. I. Bedi & Mr. A. Ali-Nakyea
Reading List Ali-Nakyea A. (2014), Taxation in Ghana-Principles, Practice & Planning, Black Mask Ltd., 3 rd Edition. Chapter 6, (page 153-166) Agalega, E. (2017) Ghana Taxation: Comprehensive Guide on New Tax Laws, 2 nd Edition, SMK Graphicx, Koforidua, Ghana. Chapter 7, (page 265-271) Income Tax ACT, 2015 (ACT 896), Ghana Publishing Company Limited, (Assembly Press), Accra, Ghana, Section 7, 12, 13, 14 15 and 16 Prof. M. Amidu, Dr. I. Bedi & Mr. A. Ali-Nakyea
ALLOWABLE DEDUCTION Topic One Prof. M. Amidu, Dr. I. Bedi & Mr. A. Ali-Nakyea
Allowable Deduction For the purposes of ascertaining the income of a person for a basis period from any business, employment, or investment there shall be deduction All outgoings and expenses wholly, exclusively and necessarily incurred during that period by that person in the production of the income from the investment or business during the year. Prof. M. Amidu, Dr. I. Bedi & Mr. A. Ali-Nakyea
Allowable Deduction Section 9 of Act 896, provides that generally, for any deductions to be allowed; It must be outgoing or expenses wholly, exclusively and necessarily incurred during the basis period in question by that person whose income is being assessed and must have been incurred in the production of that income .
- Fall '19