Deemed profit used in our assessment
The assessment taxed us on a percentage of turnover. Can we change that?
The situation
Where support is inadequate, the authority can assess on deemed profit as a percentage of turnover.
The law
- Income Tax Law practice: deemed profit assessments: Where support is inadequate the authority may assess tax on deemed profit as a percentage of turnover
- Income Tax Law: objections and appeals: Object within 60 days of assessment; the authority decides within 90 days; appeal to the Tax Appeals Committee within 30 days
What it means for you
If you can show actual costs with proper documents, object and ask for assessment on actual profit. If records are weak, focus on the margin used. For the future, keep records in Kuwait and ready for inspection.
What to do
- Compare deemed and actual profit.
- Gather cost evidence.
- Object within 60 days.
- Improve record keeping.
We can do this for youTax inspection, assessment, objection and appeal: KWD 1,200