Dead men get taxed

For the past nine years the Ministry of Finance has caused a 48-year-old widow nothing but grief.

Windhoek-based primary school teacher Helvis Emvula lost her husband, a State employee, in 2003 and thanks to the Government Institutions Pension Fund (GIPF) she received the death benefit pension ever since.

In 2007, however, Emvula was shocked to the core by a statement from the Ministry of Finance’s Inland Revenue department, claiming she owed them approximately N$20 000.

After a frantic search for answers, which she says led to ‘unclear explanations’ from both the Finance Ministry and her employer, the Ministry of Education, she was eventually advised - the suddenly inflated tax debt resulted from the GIPF money she receives.

“They decided I am in a higher tax category because of my income and pension grant, and so determined that I wasn’t taxed enough,” she says. Emvula was told that when her salary and the pension are added at the end of each financial year, it placed her on a higher income notch.

To date she owes Inland Revenue over N$100 000. This amount, she says, is due to accrued interest that has been accumulating since 2007, despite her efforts to settle it.

“I am totally confused and shocked. I was already traumatised and negatively affected by the death of my husband,” a disheartened Emvula told Namibian Sun.

She finds it ironic that her husband’s pension contribution, imagined as a means to keep his family out of poverty and within reach of a decent life, has now proved to be the complete opposite.

“Even if I die today my children will not get that pension because I owe the Government,” she lamented.
“To add insult to injury, my late husband is still getting an income tax return form from the Ministry of Finance. They should take his name out of the system - it’s even more frustrating when I receive such letters,” she says.

Emvula is not alone.

Her colleague, who spoke on condition of anonymity, lost her husband in 1998.

She is in the same boat as Emvula.

The widow currently owes Inland Revenue over N$50 000 in back taxes.

Due to a court order issued in 2011, the teacher had her furniture repossessed - only getting it back after managing to make arrangements with a government lawyer.

She, too, is still receiving letters addressed to her late husband from the Ministry of Finance, calling for payment of taxes.

“I skip some months without settling my debts because I simply don’t have enough money. I have two children in school and am paying for both out of my own pocket. I don’t even go to the Post Office anymore to collect my mail,” she says.

“I had to have an emotional conversation with one of my daughters who was deeply affected by all this, especially when they had our furniture taken away,” she says.

Explaining in general, GIPF communications officer Nelao Haimbodi says that despite popular belief that pension is or should be tax-free, income tax is deducted from pensioners who get more than N$40 000 per year, according to Inland Revenue’s tax table.

“Every year by April, the GIPF sends out tax certificates to annuitants,” she told Namibian Sun.

“If an annuitant owes tax, he or she can make an arrangement with Inland Revenue on how much can be deducted monthly from their pension to settle the outstanding debt. Inland Revenue will present them or the GIPF with a letter instructing us to deduct the outstanding tax from the member’s pension monthly until the amount is settled.

“Or, if the annuitant has more than two incomes Inland Revenue can instruct GIPF to deduct tax on a non-taxable amount. In cases like these, Inland Revenue must inform their clients that a notice has been forwarded to the GIPF to deduct extra tax to recover the outstanding amount,” Haimbodi says.

Rational as that reply may be, the two teachers say they can’t help but feel seriously done in. They say they were never made aware of the rising interest until it was much too late. This, they say, has set them up for an impossible task.