THE INCOME TAX LEGISLATION APPLIES TO NON-RESIDENTS RECEVING ANY INCOME FROM 1 FEBRUARY AND TO COMPANIES WHOSE FISCAL YEAR COMMENCES AFTER 1 FEBRUARY - E.G., 1 APRIL, 1 JULY, A SEPTEMBER 2008 AND 1 JANUARY 2009. FOR INDIVIDUALS, IT APPLIES FROM 1 JULY 2008.

DON'T FORGET TO OBTAIN A TAXPAYER IDENTIFICATION NUMBER (TIN) BEFORE 1 JULY 2008 BOTH EMPLOYEES AND EMPLOYERS (IF YOU DON'T ALREADY HAVE A CT TIN).

We have recently added a Guide to Tongan Income Tax to the website. You will find it under the heading Whats New - Publications, Forms and Guidelines. This document contains the Act and Regulations and Administration Act and Regulations and a detailed explanation of each section and/or Regulation. It is intended for advisors and others who wish to work out the meaning of a section. In addition we will shortly be publishing both in soft and hard copy a shorter version intended to be a quick reference guide for those wishing to know their income tax obligations. It can also be used a training manual.

NEW PAYE SCALES APPLY FROM 1 JULY 2008. Click here to view the upgraded PAYEWorksheets12-12-08.xls. There are now 3 worksheets with the new improved PAYE scales with instructions. The instructions have been improved to help employers and payroll clerks know what amounts to include in which worksheet.

The first WORKSHEET is for employees whose annual salary and wages which does not change during the income year. If there is any change in any particular pay period other than an increase in salary use worksheet 3. For increases in salary see worksheet 2. A change could be because of overtime, bonus, acting allowance. Employees on hourly rate or casual use owrksheet 3.

The second worksheet enables employers to work out the tax that should apply when there is a change in the pay of the employee during the year for example when there is a pay increase/increment or when an employee starts work with the employer during the year and also when an employee starts to receive to a constant benefit during the year.

The third WORKSHEET applies where an employee is employed on a daily basis or receives a one off payment for that pay period - for example when they receive overtime payments, a bonus or an allowance which they have not provided receipts showing how it related to their work. 

The new Income Tax forms for individuals in business and companies are now available on the website - go to Inland Revneue and Forms.

Note the individual return is due by 31st October with payment of tax (if any). The Company return is due within 4 months after the end of the company's financial year e.g., if the company year end is June it is due on 31st October; if it is December it is due 30th April.

Payment is due at the same time as the return. Late lodgment and late payment penalties apply if the return and payment are not received by the due date.

Also for those persons with carried forward losses please insert the amount of the carried forward loss from your 2008 assessment under item 11 on the return form.

The Privy Council has recently exempted from Consumption Tax imports by public international organisations, foreign Governments and non-profit organisations acquired for the purposes of providing charitable activities. For more information click here - CT exemption for imports by certain groups

Note an organisation has to be approved as a non profit organisation and applications should be made to the Commissioner of Revenue. A public ruling and a checklist will be issued shortly.

For further information please call 23444 and ask for Michael, Kelvin or Praveen for English or Pongipongi or Feleti for Tongan advice.