how to file tax returns in nigeria

However, the limitation does not apply in the event of a fraud, wilful default, or neglect by the company.

For many companies, the distraction that such may cause to their business is enough to raise concerns. The return should contain income earned from every sources in the year preceding the year of assessment computed in line with the provision of PITA. LIRS - Lagos State Inland Revenue Service) Tax Returns Online with 100% Accuracy. Estimated tax returns must be filed within two months of the fiscal year. All other individuals are expected to file annual income tax returns in line with the provisions of Section of 41 of PITA.

For such offences and contravention, a penalty of N5, 000 (five thousand Naira) is applicable upon conviction. Evidence of remittance of the income tax liability (partly or in full). For old and existing companies, tax returns should be ﬁled within six (6) months from the end of the company’s accounting Company Income Tax in Nigeria. Please see www.deloitte.com/about for a detailed description of DTTL and its member firms. The FIRS has started writing to banks to appoint them as collection agents of taxpayers considered to be in default of tax payments. © 2019. Filing Annual Returns in Nigeria. The employer's annual return is due not later than 31st January of every year and covers the income and taxes paid in the preceding year. This is not good. There are varying rates of WHT ranging from 2.5% to 10% for companies and 5% to 10% for individuals depending on the transaction.

The company must file the following documents with the tax authority on an annual basis: PPT is payable on an actual year basis. Upon payment of the applicable fee, applicant will be issued an e-ticket as evidence of payment. The employer's annual return is due not later than 31st January of every year and covers the income and taxes paid in the preceding year. Annual Income Tax Returns by Employers and Employees has been saved, Annual Income Tax Returns by Employers and Employees has been removed, An Article Titled Annual Income Tax Returns by Employers and Employees already exists in Saved items, According to Section 41 of PITA, all taxable persons are required, without notice or demand, to file a return of their income in the prescribed form and containing specific information in relation to their income and taxes thereon with the tax authority of their State of residence. Further, for non-resident entities that create a PE in Nigeria, the tax authorities are focused on ensuring that they file full tax returns, including audited accounts, as opposed to filing on a deemed-profit basis. The Federal Inland Revenue Service permits companies to file their tax returns based on a self-assessment system where the company prepares its own annual returns and determines its tax liabilities.

It is paid to the federal government of Nigeria through the Federal Inland Revenue Service (FIRS). Late submission of PPT returns attracts an initial penalty of NGN 10,000 and NGN 2,000 for each day such failure continues, while late payment of tax attracts a penalty of 5% of the tax not paid. The accounts should be audited and signed by External Auditors who must be members of a recognized professional body.

Please enable JavaScript to view the site. A company may file an application for extension of filing tax returns for up to two months at the discretion of the FIRS. PERSONAL INCOME TAX This tax is payable by every taxpayer in Nigeria on the aggregate amount of his through the approved or collecting banks.

The simple inference that could be made from this scary revelation is that the level of tax compliance in the country is currently below 10%. For tax purposes, a person is a resident if he or she lives in Nigeria permanently, intends to take up residence or is in the country for more than 183 days over a 12-month period. The only category of individuals that are exempted from filing income tax returns are those whose only source of income in any year of assessment is employment in which they earn N30,000 (thirty thousand Naira) or less from that source. As the Nation battles with the reality of decreasing revenue from oil, due to the global oil price decline, it will be expedient that increased attention is focused on raising the level of tax compliance.

Applicant is expected to verify the details on it to ensure completeness and correctness. Company Income tax is calculated at the rate of between 20% – 30% subject to the applicable exceptions. Nigeria requires that VAT returns are filed on a monthly basis on Form 002. Small businesses in Nigeria a new companies with a revenue of 25million naira and below from the obligation to pay the Company Income Tax. This practice has been put on hold based on case law, which was decided against the FIRS and the banks. DTTL (also referred to as “Deloitte Global”) does not provide services to clients.

We are happy to discuss how we may help your business: –. There can however be exceptions from paying specific taxes that are generally applicable to other companies.