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Pay Back New India Assurance $1M, Court Orders Customs Services

Pay Back New India Assurance $1M, Court Orders Customs Services
October 11
22:41 2018

The Court of Appeal has overturned a ruling by the Tax Court and ordered Fiji Rev­enue and Customs Services (FRCS) to refund New India Assurance Company Lim­ited a tax of more than $1 million.

Justice Almeida Guner­atne, Justice Eric Basnayake and Justice Farzana Jameel ordered that $1,112,261.85 be returned by FRCS.

The Tax Court had ear­lier ruled on whether local branch profit remittance tax is an additional tax on branch profits paid or cred­ited for remittance.

The branch profile remit­tance additional normal tax is payable when the profits earned by the branch is sent to the parent company.

The court of appeal ruled that when a branch reinvests profits in term deposits in Fiji that is not a remittance.

“When profits are made in Fiji, those profits, after tax should be free for any other use. Only if the profits are either paid or credited for remittance does it become subject to the 15 per cent ad­ditional tax.”

In the case of New India Assurance Company Limit­ed, the Fiji Court of Appeal found that no profits were paid or credited for remit­tance to their head office.

In addition, FRCS has also been ordered to pay New India Assurance Company Limited $5000 in court costs.

Edited by Naisa Koroi

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