TaxLawGHby MSL Business School
MSL Business SchoolGhana personal tax authority guide
Ghana personal income tax
The definitive guide to how Ghana taxes an individual's employment, business and investment income—covering residence, current rates, deductions, credits, instalments and annual filing.
Published and prepared by MSL Business School through TaxLawGH, its tax and fiscal policy education platform.
MSL Business School personal income tax at a glance
MSL Business School technical position
Personal income tax is determined annually across employment, business and investment income.
A resident individual's ordinary chargeable income is taxed at graduated rates from 0% to 35%. A non-resident individual's ordinary chargeable Ghana-source income is generally taxed at 25%.
The calculation is not simply a percentage of cash received. Each source is determined separately; exempt amounts and final withholding payments are excluded; allowable deductions and personal reliefs are applied under their own rules; then non-final withholding credits, provisional instalments and foreign tax credits reduce the tax payable.
Residence and scope
Residence determines whether Ghana starts with worldwide income or Ghana-source income.
An individual is resident for a year of assessment if any one of the statutory tests is met.
A Ghanaian citizen is resident unless the citizen has a permanent home outside Ghana and lives in that home for the whole year.
An individual is resident if present in Ghana for an aggregate of at least 183 days in any twelve-month period that begins or ends during the year.
An employee or official of the Government of Ghana posted abroad during the year is resident.
A citizen with a permanent home in Ghana remains resident when temporarily absent for no more than 365 continuous days.
Residence is not nationality alone: document permanent homes, travel days, employment and the complete facts. Where another country also treats the individual as resident, an applicable double tax agreement may contain tie-breaker rules.
Current individual rates
Resident individuals use the annual graduated table.
| Annual chargeable income band | Rate | Tax on band | Cumulative income | Cumulative tax |
|---|---|---|---|---|
| First GHS 5,880 | 0% | GHS 0 | GHS 5,880 | GHS 0 |
| Next GHS 1,320 | 5% | GHS 66 | GHS 7,200 | GHS 66 |
| Next GHS 1,560 | 10% | GHS 156 | GHS 8,760 | GHS 222 |
| Next GHS 38,000 | 17.5% | GHS 6,650 | GHS 46,760 | GHS 6,872 |
| Next GHS 192,000 | 25% | GHS 48,000 | GHS 238,760 | GHS 54,872 |
| Next GHS 366,240 | 30% | GHS 109,872 | GHS 605,000 | GHS 164,744 |
| Balance after the cumulative bands | 35% | 35% of the balance | Above GHS 605,000 | — |
MSL application rule: Act 1111 states the seven band widths shown above. Those widths cumulate to GHS 605,000 annually before the 35% band, while the Act's separately printed final threshold says GHS 600,000. This guide applies the enacted band widths sequentially and does not allocate the same income simultaneously to the 30% and 35% bands.
Non-resident individuals
The general rate is 25% of chargeable income. Specific payments can have separate final withholding rates, and an applicable double tax agreement can restrict Ghana's taxing right or reduce a source-country rate.
Three income sources
Determine each source separately before arriving at the annual position.
Salary, wages, leave pay, fees, commissions, gratuities, taxable allowances and benefits, and non-final bonus or overtime amounts derived from employment.
Service fees, trading receipts, business asset and liability gains, business-related gifts and other amounts effectively connected with the business.
Rent, interest, dividends, annuities, royalties, natural-resource payments, investment-asset gains and investment-related gifts, subject to exclusions and final withholding.
A payment on which tax is expressly final is excluded from ordinary assessable income. The final tax is not claimed again as an annual credit.
One return does not erase source boundaries: chargeable income from each source is first determined under the rules for that source. The annual computation then brings together the ordinary chargeable amounts that remain.
Deductions, reliefs and exclusions
Every reduction must have a statutory basis and supporting evidence.
- 01Business and investment expenses
Deduct expenses incurred wholly, exclusively and necessarily in producing the relevant business or investment income, subject to the specific limitation and denial rules.
- 02Capital allowance—not depreciation
Accounting depreciation is not deductible. A person who owns and uses a qualifying depreciable asset in producing business income claims capital allowance under the Third Schedule.
- 03Retirement-fund contributions
Apply the statutory treatment for qualifying mandatory and approved retirement contributions. The precise payroll deduction depends on the approved scheme and contribution structure.
- 04Home-mortgage interest
A qualifying resident individual may deduct mortgage interest paid on one residential premises during the individual's lifetime, subject to the statutory conditions and evidence.
- 05Worthwhile-cause contributions
A qualifying contribution or donation to a worthwhile cause may be deducted where the statutory conditions are satisfied.
- 06Personal reliefs
Resident individuals can claim the personal reliefs for which they qualify. Relief is not automatic merely because a personal circumstance exists; the claim and evidence must satisfy the law.
Private and capital expenditure: domestic or private outgoings, income tax, accounting depreciation, most capital expenditure, fines and penalties do not become deductible merely because they appear in business accounts.
MSL Business School worked calculation
How the annual personal income tax reconciliation works
Assume a resident individual has already determined GHS 120,000 of chargeable employment income, GHS 60,000 of chargeable business income and GHS 20,000 of chargeable investment income after source-specific exclusions, deductions and reliefs.
Important: a final withholding payment is not included in the GHS 200,000 and its tax is not deducted again as a credit. Only evidenced non-final withholding, PAYE, instalments and other allowable credits reduce the annual balance.
Withholding and tax credits
Classify tax deducted at source as final or non-final.
Employer withholding on ordinary employment income is credited against the employee's annual liability.
Tax withheld on account from a business or investment payment is claimed as a credit when the underlying income is returned.
The statutory deduction settles the tax on that payment. The payment is excluded from ordinary assessable income and no annual credit is claimed.
A resident with taxable foreign-source income may claim credit under the statutory limitation and evidence rules, subject to any applicable treaty.
Self-assessment and filing
Estimate, pay, reconcile and file online.
- 01Register correctly
Maintain the individual's taxpayer registration and relevant tax types. The Ghana Card PIN serves as the taxpayer identification number for eligible individuals.
- 02Submit a self-assessment estimate
An individual within self-assessment estimates the tax payable for the calendar-year basis period and revises the estimate when the expected liability materially changes.
- 03Pay four provisional instalments
Pay by the last day of March, June, September and December. These payments are credits against the final annual liability.
- 04Reconcile every source and credit
Determine employment, business and investment income separately; distinguish final payments; apply deductions and reliefs; and match PAYE, withholding and instalment evidence.
- 05File by 30 April
File the annual return and pay the outstanding balance within four months after 31 December through the Taxpayers' Portal, unless a statutory filing exclusion applies.
- 06Keep records
Retain income schedules, financial records, invoices, contracts, withholding evidence, payroll statements, relief documents, tax computations, returns and payment confirmations.
PAYE can be insufficient: an employee with business, investment, foreign or additional employment income may still need an annual return and additional tax payment even where the principal employer deducted PAYE correctly.
Frequently asked questions
Ghana personal income tax questions
What income is subject to personal income tax in Ghana?
Ordinary assessable income arises from employment, business and investment. Exempt amounts and final withholding payments are excluded, and allowable deductions are applied under the rules for each source.
What are the resident individual tax rates?
The current annual graduated rates are 0%, 5%, 10%, 17.5%, 25%, 30% and 35%. The 35% rate applies to chargeable income above GHS 605,000.
What is the non-resident individual rate?
The general rate is 25% of chargeable Ghana-source income. Specific payments and an applicable double tax agreement can produce a different result.
When is an individual tax-resident in Ghana?
Residence can arise under the citizen and permanent-home test, the 183-day presence test, a Government of Ghana foreign posting, or the temporary-absence rule for a citizen with a permanent home in Ghana.
Does PAYE settle every employee's annual tax?
No. An employee with additional employment, business, investment or taxable foreign-source income may have an annual filing and balance-payment obligation.
Are dividends and interest always added to annual income?
No. The treatment depends on whether the amount is exempt, subject to final withholding, or remains an ordinary assessable amount. The legal character of the payment must be established first.
Can an individual deduct business expenses?
Yes, where an expense is incurred wholly, exclusively and necessarily in producing business income and is not denied or limited by another rule. Private expenditure and accounting depreciation are not deductible.
When are provisional tax instalments due?
For a calendar-year individual within self-assessment, instalments are due by the last day of March, June, September and December.
When is the annual personal income tax return due?
The return for a calendar year is due within four months after year end—normally 30 April of the following year—unless a statutory filing exclusion applies.
Where is the return filed?
The current filing process is online through the Taxpayers' Portal. The taxpayer should retain the filed return, computation, credit evidence and payment confirmation.
MSL Business School legal reference map
Primary authority and operative framework
- Income Tax Act, 2015 (Act 896), as amendedImposition, chargeable income, employment, business and investment income, deductions, accounting, residence, source, foreign tax credits, payments and returns.
- First Schedule to Act 896Current resident graduated rates, the general non-resident individual rate and specific rates for designated payments.
- Third Schedule to Act 896Capital allowance rules for qualifying depreciable assets used in producing business income.
- Income Tax (Amendment) (No. 2) Act, 2023 (Act 1111)The current resident individual rate bands effective from 1 January 2024.
- Income Tax (Amendment) Act, 2018 (Act 973)The current general 25% non-resident individual rate.
- Income Tax Regulations, 2016 (L.I. 2244), as amendedDetailed implementation rules for employment, withholding, benefits, records and other prescribed matters.
- Revenue Administration Act, 2016 (Act 915), as amendedElectronic administration, returns, payment, records, assessments, interest, penalties, objections, refunds and enforcement.
Authority hierarchy: the legislation and any applicable double tax agreement control the result. Administrative guidance and the online filing system explain implementation but do not create a tax rate, deduction, exemption or relief.
Institutional publisher
TaxLawGH is MSL Business School's Ghana tax education platform.
This guide forms part of MSL Business School's public tax and fiscal policy education work. MSL publishes TaxLawGH to make Ghana's tax law accurate, understandable and useful to taxpayers, employers, practitioners, students and policy professionals.
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