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Addis Ababa Revenue Bureau Issues New Tax Guidelines for the Previous Fiscal Year

TIKVAH Ethiopia · 4 hours ago · Read the Full Story on TIKVAH Ethiopia
Addis Ababa Revenue Bureau Issues New Tax Guidelines for the Previous Fiscal Year
AI SUMMARY

The Addis Ababa Revenue Bureau has introduced new tax implementation guidelines for the 2018 E.C. fiscal year, featuring strict cash transaction limits, a minimum alternative tax for declared losses, and specific reporting rules for real estate developers.

  • The Addis Ababa City Administration Revenue Bureau released the "Tax Return and Desk Audit Guideline" for the 2018 E.C. fiscal year.
  • Cash transactions are capped at 50,000 Birr per person, per day, and per transaction.
  • Expenses exceeding the 50,000 Birr cash limit cannot be deducted from financial records, and VAT input credit claims will be rejected.
  • Taxpayers receiving cash payments above 50,000 Birr will face an administrative penalty equivalent to the excess amount.
  • Taxpayers declaring no profit for the 2018 E.C. fiscal year are subject to a 2.5 percent Minimum Alternative Tax on total annual revenue under Proclamation No. 1395/2017.
  • Undeclared or unconvincing business losses will be adjusted based on average profit margins or market price analyses of similar businesses.
  • Businesses with multiple sectors must submit separate records, with the alternative tax applying specifically to loss-making sectors.
  • Taxpayers presenting a court ruling confirming liquidation or debt restructuring are exempt from the minimum tax.
  • Real estate developers receiving advance payments must report income based on construction completion percentage, while self-financed developers use the completed contract method.
  • Real estate developers can claim input VAT credit only after construction is complete and sales have commenced.
  • Real estate developers seeking VAT exemption on residential sales must refund any input VAT claimed prior to the new VAT proclamation.
Read the Full Story on TIKVAH Ethiopia
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