Filing of Annual Returns and Compliance in Ghana: A Guide for Companies

In the realm of business, adherence to regulatory requirements is paramount for every company. Staying compliant with various regulatory bodies within the operating environment is not only a legal obligation but also crucial for maintaining a smooth and legitimate operation. Among these regulatory measures, the concept of "Renewal of Registration" or "Annual Returns" holds significant importance. While the terminology may differ depending on the governing body, the essence remains the same–the periodic reporting of a company's current status to the respective regulators.

In the vibrant business landscape of Ghana, nearly all regulatory agencies have their distinct processes for companies to renew their registration. Some demand annual renewals, while others may extend the renewal period to every two or five years following the initial registration. Maintaining meticulous records of renewal deadlines for each agency is prudent to ensure continued compliance.

This article delves into three key agencies that require Annual Returns Filing, shedding light on the significance of this process and the specific requirements for each. These agencies are the Registrar General's Department (RGD), responsible for business registration renewals; the Ghana Immigration Service (GIS), overseeing the status of expatriates working in a firm; and the Ghana Revenue Authority (GRA), handling tax-related updates.

Filing at the Registrar General's Department

Annual Returns serve as a vital means of reporting a company's current state to the regulatory authorities, effectively signifying the renewal of registration. It is a mandatory filing that must be completed every year. Understanding the intricate filing process for each agency is crucial, as it involves reporting any changes that have occurred over the given period, such as alterations in business name, activities, shareholders, directors, auditors, and the address of the principal place of business.

For a Sole Proprietorship business, filing Annual Returns is a yearly requirement, including the year of incorporation. This type of filing is relatively straightforward as it does not necessitate audited accounts. On the other hand, Companies Limited by Shares or Companies Limited by Guarantee must adhere to the Companies Act 992 of 2019, which specifies that annual returns must be filed 36 days after the approval and signing of financial statements by the directors. Additionally, Limited Liability Companies are required to file their first returns after 18 months of incorporation, subsequently filing annually for each operational year.

External Companies, also known as Branch/Liaison Offices, incorporated by a "Parent Company" registered outside Ghana's jurisdiction, are required to file returns alongside the Audited Financial Statements of the parent company.

When filing Annual Returns at the Registrar General's Department (RGD), companies must choose the appropriate form corresponding to their business type: Form 1A for Sole Proprietorship, the Form of Annual Return for Companies Limited by Shares/Companies Limited by Guarantee, and the Form of Annual Return for Unlimited Liability Companies. External Companies only need to submit the Audited Accounts of the Parent Company.

Understanding the applicable fees and penalties for late filing is equally crucial. For instance, Sole Proprietorship incurs a fee of GH¢60, while Companies Limited by Shares/Companies Limited by Guarantee and Unlimited Liability Companies face a GH¢90 fee. External Companies are subject to a fee of US$250. Late filing penalties are as follows: GH¢400.00 for Companies Limited by Shares/Companies Limited by Guarantee and Unlimited Liability Companies, and US$750.00 for External Companies.

Filing at the Ghana Immigration Service (GIS)

Moving on to the Ghana Immigration Service (GIS), their requirement for filing Annual Returns revolves around providing updated information on the total number of expatriates working in a company. The filing process entails completing a form with detailed information on each expatriate, including their employment status, residence permits, dependents, and duration of stay in the country. Unlike other agencies, GIS does not charge statutory fees for filing returns. However, late filing incurs a penalty of GH¢1,000 for each month of default.

Filing at Ghana Revenue Authority (GRA)

The Ghana Revenue Authority (GRA) also mandates Annual Returns filing every year. This involves completing the GRA returns form and submitting it alongside Audited Accounts signed by a certified Auditor. The deadline for filing at GRA is 30th April of the subsequent year. Failure to file on time results in penalties, including GH¢500 upon default and an additional GH¢10 for each day of default.

To avoid confusion, it is essential to recognize the distinction among these three agencies and the specific type of Annual Returns required by each, as well as the corresponding filing deadlines. Fulfilling these requirements diligently is crucial to evade any potential penalty payments.

Documents Required for Filing Annual Returns

Documents required for filing Annual Returns at both RGD and GRA include the Audited Financial Accounts of the company. It is important to note that even if a company did not operate during a specific period; it is still liable for Annual Returns filing. In such cases, the company should prepare a "Statement of Affairs" instead of Audited Accounts, certified by a qualified Auditor.

Interestingly, companies filing Annual Returns do not receive a new certificate; rather, they receive a receipt of payment or a copy of the filed documents as proof of compliance.

Deadlines for Filing of Returns

For Registrar General's Department, the deadline for Annual Returns submission is the 30th of April of the subsequent year of operation. Ghana Immigration Service requires companies to file their returns on or before 14th January of the subsequent year, while the Ghana Revenue Authority's deadline is 30th April of the subsequent year.

Penalty for Late Filing

Failure to file Annual Returns or late filing incurs penalty payments. The penalties for late filing are as follows: GH¢400.00 for Companies Limited by Shares/Companies Limited by Guarantee and Unlimited Liability Companies, US$750.00 for External Companies, and GH¢1,000 for each month of default for the Ghana Immigration Service. GRA imposes a penalty of GH¢500 upon default and GH¢10 for each day of default.

Conclusion

In conclusion, maintaining compliance with the various regulatory bodies is a crucial aspect of running a company. Understanding the intricacies of Annual Returns filing with different agencies, adhering to specific requirements, and meeting deadlines are vital components of responsible corporate governance. By following these guidelines diligently, businesses can ensure a smooth and penalty-free operation in Ghana's dynamic business landscape.

Remember, navigating the complexities of Annual Returns is not just a legal responsibility, but also a strategic move towards sustainable growth and success.