FAQs - Large Taxpayer
- Who is a large taxpayer?
- What should a person do where in respect of an income year he qualifies as a large taxpayer?
- What happens where, according to the records of the Director of Small and Medium Taxpayer Department, a person qualifies as a large taxpayer?
- Does a person cease to be a large taxpayer when his annual turnover falls below Rs 100 m?
- How does a large taxpayer submit his return?
- May a large taxpayer file for the same period both manual and electronic returns?
- How to proceed if a large taxpayer needs to be registered for VAT?
- Where should a large taxpayer apply for a Tax ruling?
- What are the main responsibilities of the Large Taxpayer Department?
A large taxpayer is a person whose annual gross income including exempt income for income tax purposes or the annual turnover of taxable supplies including exempt supplies for VAT purposes exceeds Rs 100 million. Large taxpayers do not include corporations holding a Category 1 Global Business Licence or a Category 2 Banking Licence.
He should immediately notify the Director of Large Taxpayer Department of that fact. In case he is also registered for VAT, he should also notify the Director of Large Taxpayer Department. He should then discharge all his obligations (including submission of returns and payment of tax) under the Income Tax and VAT enactments towards the Director of Large Taxpayer Department.
The Director of Small and Medium Taxpayer Department will transfer all accounts, returns, assessments and other documents in respect of that person, to the Director of Large Taxpayer Department who as from the date of the transfer will administer income tax/VAT in respect of that person.
No. Once a person is registered as a large taxpayer he will continue to be considered as a large taxpayer even if his annual turnover falls below Rs 100 m. He will only be deregistered as a large taxpayer upon cessation or liquidation of his business.
A large taxpayer is required by law to submit his returns and pay any tax due in accordance with his return electronically. However, under exceptional circumstances, the Director of Large Taxpayer Department may authorize him to submit manual returns and pay his tax by cheques.
No. A large taxpayer is under a legal obligation to furnish electronic returns.
The taxpayer should submit his application to the Large Taxpayer Department.
Application from a large taxpayer for a ruling as to the application of the Income Tax Act or VAT Act to any of his income or to any supplies made to him or made by him should be addressed to the Director, Large Taxpayer Department.
The Large Taxpayer Department has the following main responsibilities in relation to large taxpayers:
- To collect, assess and account for all taxes chargeable by virtue of the Income Tax Act and VAT Act.
- To carry out comprehensive audits covering all the taxes as opposed to separate tax audits done at different times by the different revenue departments.
- To develop an integrated system for the assessment, collection, enforcement and recovery of the taxes and for any repayment thereof, and
- To offset any amount of tax paid in excess by a large taxpayer in respect of any one tax against any amount of tax payable by that taxpayer in respect of the other tax.