Economist and Director of the Institute of Statistical, Social and Economic Research (ISSER), Professor Peter Quartey has encouraged businesses owners to keep proper records of their revenues to streamline their tax processes.
According to him, a poorly kept record book could prove costly for the business owner when the tax man comes around to inspect their books.
He mentioned that in order to keep ones business afloat especially within the pandemic, it was very necessary to strike a good balance between meeting the needs of customers and that of government – where taxation comes in.
“So taxes for instance, how do you pay your taxes in this environment? Luckily these days we’ve gone digitalization so it’s much easier to pay or file your tax online. But it depends on the revenue flow as well.
“Are you making the right amount of revenue that you could pay your taxes? If not, then you ought to get your accountant or whoever to show your books in a good manner.
“Keeping proper records is very critical in this period otherwise if you don’t have the records, the tax man will estimate your revenue for you and that can put some people or some businesses into trouble,” he said.
He mentioned that the problem businesses face with taxation is because of how they operate informally without regard to keeping appropriate records.
He advised that business owners seek help from experts to streamline their books.
“The challenge we all face is that we operate too informal, record keeping is very poor in many organisations. We run family businesses, everything is business as usual, and we buy something and don’t take receipts, we don’t charge withholding tax, so if you don’t adhere to the rules and regulations that is where you’ll have a problem.
“I believe there are tax experts or accounting personnel who can help you even on part time basis to help you streamline your books. Once your books are in order, if you’re making or incurring losses, there’s no way government will come and ask, or GRA will request that you pay tax on your losses,” he said.
He also cautioned businesses to take a closer look at their utilities expenses.
According to him, to avoid wasting money on unproductive ventures, it was important to ensure that utilities are used and managed efficiently to avoid accruing further costs that may burden the coffers of the company.
“And then with utilities; water, electricity supply as well as the price itself. You’ll have to factor all of it in your cost structure. If you don’t, you’d have to use all of these utilities efficiently and you ought to educate your staff.
“You’ll find staff going for break or lunch and they leave the air condition on, they leave the light on and go for an hour or two hours and come back. There has to be some cost even in the efficient use of resources, otherwise you’d end up paying more for things you don’t actually use or for things that you have not used effectively or efficiently,” he advised.
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