Title
Tax Administration in Somaliland
Course Module – Chapter 3
Deadline: 16 July
Learning Outcomes
• Understand IRD’s structure and
responsibilities
• Explain tax registration and payment
procedures
• Operate tax systems (manual & electronic)
• Use the Somaliland Tax Portal
• Recognize the value of tax compliance
Institutional Framework
• Ministry of Finance (MoFD) Units:
• - Inland Revenue Department (IRD)
• - Customs Department
• All operations handled by MoFD (no separate
authority)
• IRD Structure includes Revenue, Sales Tax,
Clearance, Statistics, R&D
Revenue Forecasting & Clearance
• Forecasting based on past tax data
• Supports budget planning and requires good
methodology
• Tax Clearance proves compliance:
• - Needed for contracts, licensing, legal
documents
Taxpayer Registration
• Registers individuals/entities and issues TIN
• Requirements: ID/Passport, trade license,
company docs
• TADAT: Unique TINs, database integrity,
duplicate screening
Taxpayer Services & Returns
• Education promotes voluntary compliance
• Simplification, transparency, and online tools
• Returns must report income and valid
deductions
• Penalties: Section 17 (failure), 2% late return
(Section 30)
Income Types & Assessments
• Types of income: Business, Employment,
Rental
• Self-assessment: taxpayer calculates & pays
• Government assessment: Administrative or
BoJ method
Benefits of E-Filing and E-Payment Systems
E-Filing
- Returns can be filed at any time (day or night) –
very convenient
- Improves customer satisfaction
- Fast refunds for taxpayers
- Assures privacy and security
- Online help and user guides available
E-Payments
- 24/7 payment convenience
- Safe and secure payment options
- Lower payment costs (no check fees)
- Increased customer satisfaction
- Speeds up revenue collection
Challenges in Implementing E-Filing and E-
Payment Systems
Need for reliable and accessible internet service
Cooperation from financial institutions
A technologically aware public (IT-oriented)
Adequate funding for infrastructure setup in tax
offices
Conclusion
• Covers tax system from registration to dispute
resolution
• Promotes transparency, modernization, and
fairness
• Emphasizes legal protection for government
and taxpayers
Tax compliance and penalties
Tax compliance means the following tax law to
our country include
_Register with a tax authority if required
_filling accurate tax on time with a monthly or
quarterly
_paying the correct amount of tax by due date
Penalties Tax include
_ fines and penalties
. Fixed fines for late filling or payment
. Interest charged on daily or monthly
on un paid tax
_Additonal assessment
. If you undereport or over claim
deductions the tax authority can reasses
you and demand more tax plus penalties
Tax tribunal and (dispute resolution in tax )
Tax dispute and resolution is a broader process
of reolving disagreement between the tax payers
and tax authority this can include
. Negotiation
. Alternative dispute resolution
. Tribunal or court
Main aims is to find fair soltion and avoid costy
time conuming litigation.
