Deductions & Allowances
Deductions & Allowances
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Business & Self-Employed
As a general rule, deductions are allowed for any expense wholly and exclusively incurred for the purpose of the trade, business, profession, employment or vocation of the taxpayer.
Expenses which are personal and capital in nature are not allowable for taxation purposes when determining a taxpayer’s final chargeable income.
Examples of allowable deductions:
- Repairs & maintenance of fixed assets of the business that is not capital in nature.
- Legal fees incurred in relation to the recovery of debts.
- Parking meter fees rather than parking fines.
- Utility bills for the business premises (e.g. electricity, telephone & water).
- Entertainment expenses for the purpose of business.
- Accounting fees paid to registered tax agents.
- Insurance premiums paid as cover for company assets.
- Bad debts written off where the taxpayer has exhausted all avenues in recovering the debts.
The following deductions and allowances as stated below are effective from April 2020
- Tax depreciation allowable depreciation write off incentive up to $10,000
- Cash donation to approved Organization/Charities /also include contribution to COVID 19 fund.
- Accelerated depreciation 100% write off
- Losses on disposal of assets for tax purposes.
- 150% tax deduction allowed or earned on interest paid or earned on corporate bonds.
- Tax deduction for reduction of commercial rent under COVID-19
- Tax deduction for salary and wages paid for quarantined/isolated employees under covid -19 (attach details).
- 150% allowed for extra FNPF paid to employees exceeding 5% and up to 10%.
- Tax deduction on loan for medical purpose
- 150%Tax deduction for donation to sports fund- the donation must be registered with Fiji National sports commission.
- 150%Tax deduction allowed to hotel and resorts that hire local artists such as craftsman, dancers and musician.
For example, the business expenses for a taxi proprietor would include:
- Repair and maintenance of taxis registered under the business name.
- Fuel and oil.
- Wheel tax and fitness.
- Base fees.
- Bank interest if taxi is under mortgage,
- Depreciation of the motor vehicle that is used as a taxi.
This Section deals with the processing of business returns of income that are required to be lodged by businesses in accordance with the requirements of the Income Tax Act. Taxpayers covered here are resident and non-residents deriving income in Fiji including sole traders, trusts, partnerships and estates.
What services are provided by Technical Section?
The main functions of the Section are as follows:
- To process returns of income for sole traders, partnerships, estates and trusts.
- To handle referrals to other units within FRCS.
- To deal with all FRCS business units.
- To direct referrals to Audit & Compliance, Legal and Information Technology sections.
- To attend to general enquiries.
- Refund approval for business taxpayers