Tax Does Not Have to be Taxing

Details

Economy

Thursday, 21 February 2013 02:30

By Donna-Marie McIntosh

Antigua St. John's - It's easy to bury your head in the sand when it comes to tax matters, but according to Randy Agrippa, from the Inland Revenue Department (IRD), there are better fiscally responsible ways to deal with the issue

Apparently, there are two inevitabilities in life: death and taxes. The taxman is not the Grim Reaper, but if you earn money, you are legally bound to tell the Inland Revenue how much you make. It is your responsibility to inform them; not theirs to inform you.

There are two categories: employed or self-employed. Agrippa explained that it is easy to differentiate which category you fall into.

Although there is no legal definition, the general rule of thumb is that if you are a business owner or a contractor who provides services to other businesses, you would be considered self-employed.

An individual is self-employed when s/he operates a business or profession as a sole proprietor, partner, independent contractor, or consultant.

If self-employed, you are responsible to register as an individual with the Inland Revenue Department and have a Tax Identification Number. You will be required to create and maintain records and send your payments to the Inland Revenue Department on a monthly basis using an F50 form. You will also be responsible for filing your annual income tax return using a F49 form, available at the Inland Revenue office.

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As an employer, you have the right to control and direct the people who perform the services, for example, their working hours. An employer is responsible for applying for a Tax Identification Number for their employees if they do not already possess one, as well as providing the relevant information to the tax office on behalf of their staff. To assist employers, the Commissioner of Inland Revenue has prepared Tax Deduction Tables.

The language the Inland Revenue uses can be described as Terms and Confusions rather than Terms and Conditions, but once you get to know the vocabulary, it is easier to understand.

Executing your own tax return is far from rocket science, as long as you keep records of all monies coming in and going out. Remember to keep all receipts.

Your payment of any personal income tax outstanding is due by March 31 for the previous year, and should be accompanied by the personal income tax return.

Agrippa advises that there are penalties for not filing, late filing, or late payment of your personal income tax.

Neglecting to pay your personal income tax can become rather costly, as a penalty of $500 is automatically applied if you fail to file a tax return by the due date.

A penalty of $1,000 is applied if you fail to maintain or retain records, and in the case of tax evasion, a penalty of 200% of the tax evaded is charged.

For further assistance, refer to the government website at www.antigua.gov.ag or visit the Inland Revenue Department.

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