DSM CPA Reviews Center C4 - Advanced Taxation CPA, David D Kiwia

C4: ADVANCED TAXATION

Contents
Part.1. Income Taxation Rules Applicable to Particular Types of Persons/Business
Part.2. Taxation of Specialized Industries
Part.3. International Taxation
Part.4. Value Added Tax
Part.5. Tax Administration
Part.6. Tax Reforms

Part.1. INCOME TAXATION RULES APPLICABLE TO PARTICULAR TYPES OF

PERSONS/BUSINESS
7.1.1. Corporate Business Income
Learners will be able to:
a) Compute corporate business income for tax purposes.
b) Explain the general and specific rules of deductions.
c) Describe the realization of business assets
d) d Describe depreciation allowances according to the 3rd schedule.
7.1.2. Taxation of Trusts
Learners will be able to:
a) Explain the meaning of trust, unit trusts and trustees
b) Discuss the taxation principles of trust and its members

7.1.3. Taxation of partnership

Learners will be able to:
a) Explain the meaning of Partnership
b) Explain taxation principles of partnership business
7.1.4. Corporate Investment Income
Learners will be able to:
a. Explain the meaning of Investment and its differences from business
b. Describe inclusions /component of investment income
c. Describe exclusions /income not Included in Investment income
d. Explain allowable and non-allowable deductions of investment income
e. Establish chargeable Investment Income
7.1.5. Tax Accounting for Long Term Contracts

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DSM CPA Reviews Center C4 - Advanced Taxation CPA, David D Kiwia

Learners will be able to:

a) Describes the accounting for revenue and expenses under long-term contracts
b) Explain the rules for accounting long term contracts transactions for income tax
purposes
c) Explain the treatment of unrelieved loss under long- term contract

Part.2. TAXATION OF SPECIALIZED INDUSTRIES

7.2.1. Taxation of Insurance Business
Learners will be able to:
a) Describe special rules related with computation of taxable of a person running General
Insurance Business
b) Describes special rules related with computation of taxable of a person running Life
Insurance Business

7.2.2. Taxation of Retirement Funds

Learners will be able to:
a) Explain the meaning and types of retirement funds
b) Describe general principles on taxability of retirement funds
c) Describes taxation rules of approved retirement funds in the year they cease to be
approved
d) Explain taxation rules relating to transfer of funds among retirement benefits
7.2.3. Taxation of Charitable Businesses
Learners will be able to:
a) Explain the meaning of charitable or religious organization
b) Describes taxation principles of charitable or religious organization
c) Explain taxation rules when charitable Organisation or Religious Organization Ceases
to be Charitable
7.2.4. Taxation of Clubs and Trade Associations
Learners will be able to:
a) Explain the meaning of a club and trade association.
b) Describes taxation principles of clubs and trade associations.
7.2.5. Taxation of Petroleum Operations
Learners will be able to:
a) Explain the meaning of petroleum and petroleum operations

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Kiwia, David D. CPA-T, BAF, MFA-OG PhD- Accounting (IP) . kiwiadavid09@gmail.com 0716 734 577
DSM CPA Reviews Center C4 - Advanced Taxation CPA, David D Kiwia

b) Describe general principles on taxability of petroleum operations

c) Explain calculation rules of depreciation allowances for petroleum operations.
d) Describe taxation rules for midstream and downstream activities

7.2.6. Taxation of Mining Operations

Learners will be able to:
a) Explain the meaning of mining and mining operations
b) Describe general principles on taxability of mining operations
c) Explain calculation of rules of depreciation allowances for mining operations.
d) Describe taxation rules for processing, smelting and refining business

Part.3. INTERNATIONAL TAXATION

7.3.1. Taxation of Permanent Establishments (PEs)
Learners will be able to:
a) Discuss the rationale for permanent establishment rules in income taxation
b) Discuss the meaning of Permanent Establishments
c) Differentiate between domestic and foreign permanent establishment
d) Calculate the income attributable to Permanent Establishment
e) Calculate the repatriated income of a domestic permanent establishment
f) Calculate tax liabilities of permanent establishments
7.3.2. Taxation of Controlled Foreign Corporations and Trusts
Learners will be able to:
a) Discuss the meaning and rationale behind taxation rules for controlled foreign trusts
and corporations
b) Describe the principles of taxation of controlled foreign trusts and corporations and its
members
7.3.3. International Double Taxation of Income
Learners will be able to:
a) Explain the meaning and effects of international double taxation of income and forms
of double taxation of income (juridical vs economic)
b) Explain causes of juridical double taxation of income,
c) Explain the approaches for double taxation relief and the nature and purpose of bilateral
double taxation treaties
d) Explain main Model Tax Conventions on Double Tax Agreement

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Kiwia, David D. CPA-T, BAF, MFA-OG PhD- Accounting (IP) . kiwiadavid09@gmail.com 0716 734 577
DSM CPA Reviews Center C4 - Advanced Taxation CPA, David D Kiwia

e) Explain the general approach to interpretation of a DTA

f) Outline the standard chapters and articles of a model DTA
g) Explain the Stages in the life of a double tax treaty and procedures for incorporation of
the treaty into domestic law
h) Explain the relationship between tax treaties to domestic law and discuss the concept
of treaty overrides
i) Explain limitations on the use of double tax treaties by tax authorities
j) Describe methods of eliminating Double Taxation (deduction method, exemption
method, credit method)
7.3.4. International Tax Planning and Avoidance
Learners will be able to:
a) Explain international tax planning and the need for international tax planning
b) Describe tax planning and avoidance techniques employed by multinational firms
c) Describe general anti-avoidance provisions and specific anti-avoidance provisions
(anti-thin capitalization, anti- treaty shopping, CFCs rules, transfer pricing etc.)
d) Describe judicial anti-avoidance doctrines (Business purpose rule, substance over form
principle, sham transaction, step transaction doctrine etc)

7.3.5. Transfer Pricing

Learners will be able to:
a) Discuss the meaning of transfer pricing
b) Discuss the rationale for introduction of transfer pricing regulations in Tanzania
c) Describe the provisions of the Tanzania Transfer Pricing Regulations
d) Describe recommended transfer pricing methods (comparable uncontrolled price;
resale price; cost plus; profit split; transactional net margin; other methods of transfer
pricing.)
e) Explain the basic comparability factors in the process of TP benchmarking
f) Explain and illustrate Functional analysis
g) Explain the provisions relating to Advance Pricing Agreement
h) Explain the provisions relating to Safe Harbours’
i) Outline the basic documentation requirements for transfer pricing benchmarking
j) Describe specific transactions
– Intra-group service
– Intangible property

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Kiwia, David D. CPA-T, BAF, MFA-OG PhD- Accounting (IP) . kiwiadavid09@gmail.com 0716 734 577
DSM CPA Reviews Center C4 - Advanced Taxation CPA, David D Kiwia

7.3.6. Thin Capitalization

Learners will be able to:
a) Explain the meaning of the term ‘’thin capitalisation’’
b) Describes the reasons why entities may choose to be thinly capitalised.
c) Explain various approaches to prevent thin capitalisation
d) Describes thin capitalisation rules in Tanzania
7.3.7. Tax havens
Learners will be able to:
a) Explain the meaning and features and uses of tax havens
b) Explain main types of tax havens
c) Describe forms of tax avoidance in tax havens
d) Describe incentives for a country to become a tax haven
e) Explain the cost of tax havens to LDCs
f) Describe the OECD Committee on Fiscal Affairs (CFA) harmful tax competition report

Part.4. VALUE ADDED TAX

7.4.1. Partial Input Tax Credit
Learners will be able to:
a) Describe partial input tax credit
b) Explain annual input tax adjustments c. Describe other VAT adjustments
7.4.2. VAT on Specialized Transactions and Entities
Learners will be able to:
a) Describe VAT implication on sale of an economic activity as a going concern
b) Describe Value Added Tax on Insurance business
7.4.3. VAT Refunds
Learners will be able to:
a) Describe the circumstances for VAT refunds
b) Explain the requirements for effecting VAT refunds
c) Explain procedures for VAT refunds
d) Describe VAT refunds procedures to diplomats and international bodies
7.4.4. Administrative Provisions for VAT
Learners will be able to:
a) Describe returns and notices under VAT
b) Describe documents, Records and accounts to be kept for VAT purposes

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Kiwia, David D. CPA-T, BAF, MFA-OG PhD- Accounting (IP) . kiwiadavid09@gmail.com 0716 734 577
DSM CPA Reviews Center C4 - Advanced Taxation CPA, David D Kiwia

c) Describe the consequences of not meeting the filing and payment

d) State the VAT offences from non-compliance.
e) Describe the electronic fiscal devices system, its benefits and the possible revenue risks
involved

Part.5. TAX ADMINISTRATION

7.5.1. Self-Assessment for Entities
Learners will be able to:
a) Explain the Self-Assessment System and the process for making self-assessment
b) Explain Tax payable on the assessment and due date for payment
c) Explain the procedures for payment of Income tax by quarterly instalments
d) Calculate Interest for Under Estimating Tax Payable and failure to pay tax
7.5.2. Settlement of Tax Disputes
Learners will be able to:
a) Explain causes of tax disputes and measures to avoid tax disputes
b) Explain Handling of Tax objections in Tanzania
c) Explain Tax Revenue Appeals system in Tanzania

Part.6. TAX REFORMS

7.6.1. Recent Reforms of major tax laws (Income Tax, Tax Administration and VAT) in
the Tanzanian Taxation System
Learners will be able to:
a) Discuss tax reforms made within the last 12 months

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Kiwia, David D. CPA-T, BAF, MFA-OG PhD- Accounting (IP) . kiwiadavid09@gmail.com 0716 734 577