THE TAXAIDER NEWSLETTER VOL 2, ISSUE 10 (OCTOBER 2020)

First Thoughts: Like the Phoenix; Like Nigeria.

I grew up reading a lot of fantasy story books and believed for a very long time in the existence of a lot of mythical creatures. I looked forward to encounters with fairies, centaurs, bush babies, unicorns, dinosaurs and mermaids among others. I was almost a teenager before I got to finally accept that I was never going to actually see any of these creatures and so had to settle for the encounters with them in these story books and movies. I read all the 7 Harry Potter Books by J.K. Rowling from my early teens and into my early twenties and of course watched every single one of the movie adaptations and this simply reinforced my fascination with the imaginary world.

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4 IMPORTANT STEPS TO ENSURE YOU AND YOUR ORGANISATION STAY TAX COMPLIANT IN 2021 – 2020 PAYE RETURNS FILING PROCESS

It’s hardly news that we are in the last few months of 2020 and just like you have visions and goals every year, you should adopt same for your tax obligations in 2021.

The first quarter of every year is a crucial period in the tax compliance space in Nigeria. The first quarter ushers in the PAYE and PIT returns filing process. In this piece we would review the PAYE returns filing process as this is what is required first before the PIT filing returns.

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Nigeria’s 2021 budget: What you need to know

Following the recent release of the 2021 budget by the President of the Federal Republic of Nigeria, there have been concerns over Nigeria’s debt stock as the nation plans to fund the 2021 budget deficit with N4.28 trillion new borrowings, a situation that has attracted huge backlash from the citizens. The proposed new borrowings represent about a third of the proposed budget. We explain further details on the proposed budget below while comparing it to the 2020 budget.

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What is your 2021 Tax Strategy – HOW TO STAY AHEAD OF THE PAYE FILING RETURNS PROCESS

Tax compliance: PAYE

In Nigeria today about 75% of potential taxpayers are not in the tax net, and about 65% of registered taxpayers are not fully compliant. This is a worrisome reality that needs to be critically addressed as the average level of tax compliance in Nigeria is put at about 10% based on our research findings.

A taxpayer must ensure that his/her taxes are paid and are also duly accounted for from time to time. This means taxes are paid as and when due and that relevant returns are submitted to the tax authorities in prescribed forms and formats. Going by the news emanating from many State Boards of Internal Revenue, the level of compliance with the requirements for filing of Personal Income Tax returns as prescribed by the Personal Income Tax Act (PITA) remains low across the country.

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