Ghana imposes a 5% flat VAT rate on commercial rent and estate-developer sales and taxes non-life insurance (Act 1107)

What changed in detail

The Value Added Tax (Amendment) Act, 2023 (Act 1107) received assent on 29 December 2023. It amends the Value Added Tax Act, 2013 (Act 870). The Ghana Revenue Authority’s public notice of 31 January 2024 announced its implementation from 1 January 2024.

Flat rates. Section 1 inserts two subsections into section 3 of Act 870:

• a taxable person supplying immovable property for rental, other than accommodation in a dwelling or in a commercial rental establishment, accounts for VAT at a flat rate of five per cent of the value of the supply;
• an estate developer making a taxable supply of immovable property does the same.

Input tax cannot be deducted on either supply.

Non-life insurance. The First Schedule now exempts financial services “excluding non-life insurance”, so the Act removes the exemption for non-life insurance. A new input-tax rule covers indemnity payments under non-life insurance contracts. The GRA’s FAQ gives 1 July 2025 as the start of VAT on non-life insurance, for policies issued or renewed on or after that date. The Value Added Tax (Amendment) Act, 2025 (Act 1133), assented on 2 April 2025, later exempted motor vehicle insurance.

Withholding agents. New sections 47D and 47E make an appointed withholding agent that fails to withhold and remit VAT liable for the tax plus a penalty of 30% of the amount. The tax withheld is due by the 15th of the following month, and section 47E provides for its recovery from the payee.

Zero rates and exemptions:

• the zero rate for locally manufactured textiles and locally assembled vehicles is extended to 31 December 2025;
• locally manufactured sanitary towels are zero-rated;
• imports of electric vehicles for public transport are exempt.

What it means

Act 1107 is spent. The Value Added Tax Act, 2025 (Act 1151) repealed Act 870 and all of its amendments, Act 1107 included, from 1 January 2026. Act 1151 has a single 15% rate and no flat-rate schemes, so the 5% flat rate on commercial rent and estate-developer sales ended on 31 December 2025.

Act 1107 still matters for 2024–2025 periods. A GRA audit of a landlord or developer for those years applies the 5% flat rate with no input tax deduction, and a withholding agent that failed to withhold and remit VAT in those periods faces the 30% penalty under sections 47D and 47E. Non-life insurance is easy to misread: the exemption was removed in law from 1 January 2024, but the GRA applied VAT only to policies issued or renewed from 1 July 2025, and motor insurance is exempt. The zero rates now rest on Act 1151 rather than on Act 1107. According to the GRA, locally manufactured sanitary towels stay at 0%, and the zero rate for locally manufactured textiles now runs to 31 December 2028.