Tax Administration Diagnostic Assessment Tool Pre-Assessment Module 6: TIMELY FILING OF TAX DECLARATIONS
Desired Outcome of POA 4 The desired outcome is: Taxpayers file their tax on time. Tax are the principal means by which a taxpayer s liability is established. There are monthly or quarterly or annual cycles for filing, which vary from tax to tax. Tax laws and administrative rules specify who is required to file and when, and what supporting documents are required. It is important that all who are required to file do so at the time when it is due. Failure to meet the filing requirement on time may result in penalties, interest or prosecution. Tax may be paper-based or in electronic form and may be filed by the themselves or their tax accountants/lawyers.
Promoting use of electronic filing for all core taxes Having a solid IT system that monitors and manages filing compliance Simplifying filing requirements, including prefilling of tax Good Practice in Filing of Tax Declarations Being proactive in reminding of approaching deadlines Using automated processes to identify who have failed to file on time Outreach programs to assist taxpayer groups and intermediaries Using profiling techniques based on behavior to predict effective actions to achieve on-time filing Timely follow up and enforcement action tailored to the circumstances and filing history of non-filers
Performance Indicator for P4-10: Filing of Tax Returns High Level Indicator P4-10: On-time filing rate [M2] P4-11: Use of electronic filing Number of CIT filed by the statutory due date in percent of expected by registered CIT Number of PIT filed by the statutory due date in percent of expected by registered PIT Number of VAT filed by the statutory due date in percent of expected by registered VAT Number of PAYE withholding filed by the statutory due date in percent of expected by registered employers Extent to which tax are filed electronically Dimensions
What is expected declaration? For TADAT purposes of measuring on-time filing rates, expected tax means the number of that the tax administration expects to receive from all registered that are required by law to file returns. Excluded from the measure are: * Unregistered * Non-mandatory tax from who have no legal obligation to file, e.g., who are below the filing threshold, or exempt category Dimensions
Scoring P4-10-1: On-time Filing Rate for CIT Returns Total number of CIT filed by the statutory due date in percent of the total number of CIT expected from registered CIT Number of CIT filed by the due date x 100 Number of CIT expected from registered CIT A Ratio is 90 percent and above for all - Ratio is at least 99 percent for all large B Ratio is 75 percent 90 percent for all - Ratio is at least 95 percent for all large C - Ratio is 50 percent and above up to 75 percent for all - Ratio is at least 90 percent for all large D The requirement for a C rating or higher are not met OR information insufficient
Scoring P4-10-2: On-time Filing Rate for PIT Returns Total number of PIT filed by the statutory due date in percent of the total number of PIT expected from registered PIT Number of PIT filed by the due date x 100 Number of PIT expected from registered PIT A Ratio is 90 percent and above B Ratio is 75 percent 90 percent C Ratio is 50 percent 75 percent D The requirement for a C rating or higher are not met or information insufficient
Scoring P4-10-3: On-time Filing Rate for VAT Returns Total number of VAT filed by the statutory due date in percent of the total number of VAT expected from registered VAT Number of VAT filed by the due date x 100 Number of VAT expected from registered VAT A Ratio is 90 percent and above for all Ratio is at least 99 percent for all large B Ratio is 75 percent 90 percent for all Ratio is at least 95 percent for all large C Ratio is 50 percent 75 percent for all Ratio is at least 90 percent for all large D The requirement for a C rating or higher are not met OR information insufficient
Scoring P4-10-4: On-time Filing Rate for PAYE Returns Total number of PAYE withholding filed by employers by the statutory due date in percent of the total number of PAYE expected from registered employers Number of PAYE withholding filed by the due date x 100 Number of PAYE withholding expected from registered employers A Ratio is 90 percent and above B Ratio is 75 percent 90 percent C Ratio is 50 percent 75 percent D The requirements for a C rating are not met OR information insufficient
Scoring P4-11: Use of Electronic Filing The extent to which tax are filed electronically A At least 85 percent of are filed electronically for each of the core taxes All large file electronically B At least 70 percent of are filed electronically for each of the core taxes At least 80 percent large file electronically C At least 50 percent of are filed electronically for at least two core taxes D The requirement for a C rating or higher are not met OR information insufficient
Checklist of Questions and Evidence for POA 4 Table 14 of the Field Guide