What are the requirements for becoming an approved organisation to which donors could qualify for a tax deduction under the provisions of Section 21(n) of the Income Tax Act?
The organisation must first be registered under the Charitable Trusts Act.
In considering the taxable status, the organisation’s constitution is perused to ensure that it meets the criteria set out in Section 17(5) of the Income Tax Act.
The features are:
The organisation needs to submit a formal written application to the Chief Executive Officer with the following documents:
In considering whether an organisation should be listed as an approved charitable organisation, the following factors are considered:
The decision by Chief Executive Officer will be based on the information provided.
What sort of repairs and maintenance expenses are businesses allowed to claim as a deduction for income tax purposes?
Businesses are only allowed to claim repairs and maintenance expenses incurred for:
On-going maintenance such as motor vehicle and air conditioner servicing are deductible.
Is our company allowed to claim legal fees incurred in relation to securing a business deal with another party?
Legal expenses that are allowable for income tax purposes are those incurred in the course of earning income (e.g. relating to preparation of business contracts, leases and for the purpose of debt recovery). Legal expenses of a capital nature are not allowable, such as relating to change in shareholding or sale and purchase of a business.
Can our company treat parking fees and fines as an allowable deduction for income tax purposes?
Your company may claim parking fees if it is incurred for business purpose as it is an expense or loss connected to the nature of the trade. You are not entitled to claim parking fines as they are a punishment for illegal behaviour, not in connection with the nature of a trade.
How long does it take now to process Income Tax & VAT returns for businesses?
It takes three to four weeks to process business Income Tax & VAT returns.
Are we still allowed by FRCA to claim for a tax refund if we lodge our return one year or more from end of year of assessment?
Yes, you are entitled to get a refund even if you lodge your return after one year has lapsed without being charged any late lodgement penalties. You will only be charged late lodgement penalties if it is a payable case.
As a general rule you must make a claim for refund within three (3) years from the end of year of assessment. If you make a claim after three (3) years has lapsed, the refund is forfeited and is referred to the Public Trustee.
Can my refunds be offset against my business’s tax liabilities?
Income Tax, VAT and other tax refunds are offset against any tax liabilities of a taxpayer. However, PAYE tax cannot be offset against any refunds.
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