INTRODUCTION

The Federal Inland Revenue Service (or ‘The Service’) in its Public Notice (PN) of August 14, 2019 directed all companies, particularly those in the Fast-Moving Consumer Goods (FMCGs) Sector to deduct at source, Withholding Tax (WHT) and Value Added Tax (VAT) from compensations due to their distributors and customers.

These compensations referred to by the Service are marketing schemes and business promotion strategies deployed by companies to penetrate the market, promote their brands, build customer loyalty and ultimately grow revenue. As rightly noted by the Service in the Public Notice, these compensations are awarded to agents, dealers, distributors, retailers and can be in the form of cash payment, credit notes or even goods-in-trade. The critical points of this issue include:

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There is no doubt that COVID-19 hit all economies globally really hard. From the drastic decline in business activities to some organisations shutting down operations, the impact of the pandemic can hardly be ignored. To curb the rate at which the disease is rapidly spreading a number of countries have restricted movement with some implementing outright lockdowns.

I once heard that there are two things that are certain in this life; death and taxes. However, to mitigate the effects of the global pandemic, the governments of many countries have implemented monetary and fiscal measures; Nigeria is one of such countries and a number of palliative measures have been put in place, one of which is the proposed Emergency Economic Stimulus Bill 2020. Please read our thoughts on this Bill here in case you missed it. As it stands taxpayers still have to comply with their tax obligations either as it relates to tax filings or remittances.

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There is no doubt that COVID-19 hit all economies globally really hard. From the drastic decline in business activities to some organisations shutting down operations, the impact of the pandemic can hardly be ignored. To curb the rate at which the disease is rapidly spreading a number of countries have restricted movement with some implementing outright lockdowns.

I once heard that there are two things that are certain in this life; death and taxes. However, to mitigate the effects of the global pandemic, the governments of many countries have implemented monetary and fiscal measures; Nigeria is one of such countries and a number of palliative measures have been put in place, one of which is the proposed Emergency Economic Stimulus Bill 2020. Please read our thoughts on this Bill here in case you missed it. As it stands taxpayers still have to comply with their tax obligations either as it relates to tax filings or remittances.

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It is worthy of note that the hearty cheers and warmth the beginning of a new year brought already seem like a distant memory today. I remember all the new year memes, challenges and posts that were met with fun, laughter and so much enthusiasm. 2020 was our year! It had so much in store. However, like a horror movie, the year seemed to unravel as the weeks went by, starting from the heat waves, the Australian wildfire, Volcanic eruptions and the most devastating of all, the Human Corona Virus (COVID-19) pandemic sweeping through countries with the force of a wildfire and hurricane combined. I am pretty sure we as a people will survive these times and I truly hope that a cure for the COVID-19 is in sight. I’ll like to advice everyone to stay safe, take proper preventive measures and stay at home.

In other news, the ongoing price war between Saudi Arabia and Russia if not curtailed could seriously impact the world economy. Its impact on Nigeria’s economy could be devastating with the possibility of another recession looming.

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For the first time in a while, I am writing this editorial from somewhere besides my office desk. I am writing from my reading table at home and this is not because I am on a holiday or just feeling lazy but because Miss Rona has confined me and so many others all over the world to our homes. I first heard the term ‘Miss Rona’ few days ago as is being euphemized in some quarters and for a second, I wondered why it wasn’t called ‘Mr Rona’ or ‘Sir Rona’.
In my amazing intern, Oladayo Olukowi’s words, the Corona Virus pandemic is currently sweeping the planet like a wildfire and a hurricane combined and it is scary to say the least. As at 6.55pm Nigerian time today, 26th March, 2020, there are 510,645 total cases and 23,079 total deaths reported worldwide. There have been 122,245 recoveries, however. Whichever way we choose to look at it, the world has been truly humbled by this reality. No one seems to have the answers and we are all united globally in our strong desire to surmount this challenge.

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Background:

COVID-19 has proven to be more than a disease or global pandemic, it is proving to be the harbinger of an economic crisis of global proportion. Many businesses are being shut or slowed-down and industrial production and retail sales have suffered historical drops. True to its nature, man is fighting back; from controlling the disease, to curing the sick and trying to develop vaccinations against it. In responding to the economic downturns, some countries have designed both fiscal and monetary palliatives in the nature of laws or executive orders. Nigeria is one of such countries; its House of Representatives on Tuesday, March 24, 2020 passed a Bill to cushion the economic effect of the global pandemic. It is styled as  “A Bill for an Act to provide for Relief on Corporate Tax Liability, Suspension of Import Duty on Selected Goods and Deferral of Residential Mortgage Obligations to the Federal Mortgage Bank of Nigeria for affixed term to protect jobs and alleviate financial burden on citizens in response to the economic downturn occasioned by the outbreak of COVID-19 disease” (the “Bill”). Our summary of the Bill is set out below.

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The Annual Individual PIT Filing Returns season is upon us and the due date which falls on March 30, 2020 is fast approaching. This in line with Section 41 of the Personal Income Tax Act, 2011, Cap P8 LFN 2004 as amended, Which states that a taxable person shall, without notice or demand, file a return of the income in the prescribed form and containing the prescribed information with the tax authority of the State in which they reside, within ninety (90) days from the commencement of every year.

This detailed piece will keep you informed and guide you on the steps to ensure you stay compliant and avoid the stiff penalties.

1. What is PIT Filing Returns?
   PIT Returns details all income earned by taxable persons in the preceding calendar year to the Relevant Tax Authority(ies) (“RTA(s)”) of the state in which the taxable person resides. For the 2020 PIT Filing Season the income earned in the calendar year January 1, 2019 to December 31, 2019 is to be filed with the RTA(s).
   
2. Is Filing your PIT Returns the same as Paying your PIT?
   No, it is not. Filing your PIT Returns involves providing your RTA with all relevant information on your 2019 income, and especially providing all information on the tax reliefs, deductions, exemptions and credits that you are entitled to, including PIT you might have paid.
   
3. When is the deadline for Filing the 2019 PIT Returns?
   Monday, March 30, 2020. This is in line with Section 41(3) of PITA, which states that the taxable person shall file with the RTA within ninety (90) days from the commencement of every year of assessment.

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