Social security contributions
The social security contribution scheme is structured into three tiers. The first two require mandatory contributions; however, the last one is voluntary.
Under the first two tiers, the employee is required to contribute 5.5% while the employer contributes 13%. Of the total contribution of 18.5%, 13.5% is contributed to the first tier and 5% to the second tier schemes. These contributions are deductible for tax purposes and are tax free for both the employer and the employee.
Under the third tier, there are no restrictions on the contributions made to the fund. However, contributions made by an employer and employee of up to 16.5% are exempt from tax on both the employer and the employee to the extent of their respective contributions to an approved fund manager. All contributions in excess of 16.5% are taxable on the employee or employer or both.
Expatriates, unless exempt, are required to contribute to the mandatory social security schemes. However, expatriate employees of contractors and sub-contractors (of the upstream petroleum industry) are not required to participate in any insurance, compensation, or other employee or social benefit programmes established in Ghana.
Capital gains tax (CGT)
CGT is payable by every person on any capital gains accruing or derived from the realisation of assets and liabilities. Where the chargeable income of an individual includes a gain from the realisation of an investment asset not charged elsewhere, the individual may elect that the gain from the realisation of the investment asset, less any loss from the realisation of that asset, is taxed at the rate of 15% and the remainder of the chargeable income of the individual be taxed at the graduated scale rates.
Value-added tax (VAT)
Other than exempt goods and services, VAT of 12.5% is charged on the following:
- Every supply of goods and services made in Ghana.
- Every importation of goods.
The supply of tangible goods by VAT-registered wholesalers and retailers is subject to VAT at the flat rate of 3%. An exemption applies for the supply of any form of power, heat, refrigeration, or ventilation. Input VAT incurred by these suppliers is not deductible.
National Health Insurance Levy (NHIL) and Ghana Education Trust Fund Levy (GETFL)
Unless otherwise exempted, NHIL of 2.5% and GETFL of 2.5% are charged on the following:
- Every supply of goods and services provided in Ghana.
- Every importation of goods.
- Supply of imported service.
Inheritance, estate, and gift taxes
Inheritance, estate, and gift taxes are not expressly and separately provided for under the tax laws of Ghana.
It is worth noting that a gift received by an individual is included in the assessable income of the individual and taxed at the applicable tax rate of 25% (for non-resident) or the highest marginal rate of 35% (for resident). There is, however, an option to elect and apply a 15% tax on gifts received by an individual if that gift is not in respect of business or employment.
Please see the Other taxes section in the Corporate tax summary for more information.