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GRA Interest Penalty for late filing of Tax Returns

Mar 08, 2012 Letters

 

Dear Editor,
I wish to express an opinion on the explanation given by the Guyana Revenue Authority in the Stabroek News on Sunday February 05, 2012, for charging an Interest Penalty of two percent under Section 60( 1) of the Income Tax Act. Under this Section the penalty can only be applicable if at the time of the assessment the tax is due and payable.
In the case of this bauxite worker, the Taxpayer has already paid the taxes due in Advance, therefore, in simple arithmetic a creditor cannot charge interest if there is no principal amount outstanding. The provisions of Section 99(1) of the Income Tax Act and Section 6(B)(1) of the Financial Administration and Audit Act, states, ” penalties and interest will be charged on the tax remaining unpaid at the due date. The Total Revenue Integrated Processing System ( TRIPS) is not deducting the Taxes paid before the due date at the  time of computing the Assessment. As a result the outstanding interest is calculated  incorrectly.
The primary obligation to the Guyana Revenue Authority would have been completed when the Employer, The Guyana Bauxite Company, confirmed that the Income Taxes have been deducted from the worker’s income ( salary ) and remitted to the Guyana Revenue Authority in Advance for the Year of Assessment.
By completion and submission of the Employer’s Return Form 2A and 2B before February 28, in any year, is satisfactory confirmation by the Employer that the worker has fulfilled his obligation to the G.R.A. These forms gives the worker’s name and address, TIN number, total income and tax deducted and remitted to the GRA. If there are any errors, the GRA has to notify the Employer.
The completion and filing the Individual Income Tax Form is a secondary responsibility of the bauxite worker and is subject to when the Employer completes and gives the worker the I.R.D. 7B2 Form.
The interpretation of the Penalty clause by GRA makes all employed persons, sugar workers, bauxite workers, magistrates, judges, civil servants, sales clerks etc, liable to this fine. The Guyana Bar Association views on this matter would be welcomed.
Khalil Ahmed

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