Introduction:
The recent revenue drive arising from fall in oil prices and the need to diversify Nigeria’s revenue away from oil to non-oil sources, such as taxation, has led to increase in the frequency of tax audits and investigations conducted by both the Federal Inland Revenue Service (FIRS) and the State(s) Boards of Internal Revenue (SBIR).
The Federal Inland Revenue Service (FIRS) in 2018 recorded a total tax collection of N5.320triIIion with N2.852triIIion from non-oil revenue and N212.792biIIion from 2278 audit cases. It also claims a huge reduction in audit cycle and has hinted of its intention to surpass the collection figure in 2019. The ambitious collection targets coupled with the claimed data on registered and unregistered companies not contributing to the Country’s tax collection, signals an intending intensified effort directed at achieving the set targets. No doubt, achieving the set targets would require broadening the scope of tax coverage, continued compliance drive by taxpayers, more aggressive and timely tax audits and investigations, and lots of emphasis on entities not currently contributing to the Country’s tax collection.
This briefing note aims to broaden taxpayers’ understanding of tax audit and investigation processes, while also providing useful insights towards efficient audit and investigation management process that provides the best possible outcome.
