My Blog - Page 12 of 25

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.

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.

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.

FAAC 2020 AUGUST DISBURSEMENT – WHAT IS THE WAY FORWARD

According to the latest Federation Account Allocation Committee (FAAC) Disbursement Report, released by the National Bureau Statistics (NBS), the sum of N676.41bn was disbursed to the three tiers of government in August 2020 from the revenue generated in July 2020. Compared to the amount disbursed in the previous month (July 2020) this brings about a 2.83% decrease.

THE TAXAIDER NEWSLETTER VOL 2, ISSUE 9 (SEPTEMBER 2020)

First Thoughts: The Underdog Story

The idea of politics fascinates me to no end. While I wouldn’t necessarily call myself partisan, I am honest enough to say I do a lot of watching on the side lines. I am not a registered member of any political party in Nigeria, but I have always tried to be a good citizen and cast my votes a couple of times since the first time I voted in 2007. I had missed the 2003 elections by whiskers as I was yet to hit the voter eligibility age of 18 at the time. Elections, both in Nigeria and outside Nigeria have continued to thrill me even till date. For instance, I can hardly wait for the U.S.A Presidential Elections in November.

Constant increase in the inflation rate – Nigeria’s CPI August 2020 Report

The latest CPI and Inflation Report released by the National Bureau of Statistics has revealed that inflation increased by 13.22% (Year-on-Year) in August 2020. This is 0.40% points higher than the rate recorded in July 2020 (12.82%).

It’s is not so surprising that the consumer price index (CPI) in Nigeria rose to its highest in over 3 years in the previous month (August 2020). The increase in the price of food is said to be the major reason in this hike.

TAT’s Decisions on VAT on Real Property Leases – Some Clarifications

As you are aware, on Tuesday, 10^th September 2020, the Tax Appeal Tribunal sitting in Lagos State, Nigeria (TAT) delivered Judgement in Appeal No. TAT/LZ/VAT/029/2019: Ess-Ay Holdings Limited v. Federal Inland Revenue Service (FIRS) (available at: https://taxaide.com.ng/wp-content/uploads/2020/09/Judgement-Ess-ay-Holdings-Ltd-v.-FIRS.pdf)

Issues to be determined:

Whether rental income from real property is subject to Value Added Tax (VAT) under Nigeria’s VAT Act, 1993 (as last amended in 2007)?;
Whether the provisions of the FIRS Information Circular No. 9701 dated 1^st January 1997 which exempted only rents from residential properties (and not commercial properties) is valid?

FINANCIAL AND TAX MANAGEMENT FOR START-UPS IN NIGERIA

In this piece, I shall be walking you through the importance of financial and tax management for start-ups in Nigeria. In recent times, Nigeria has risen to be one of the leading business locations in Africa; most significantly for start-up businesses.

Business in Nigeria is a wonderful experience when your business venture succeeds, however before success there could be great challenges and difficulties that a new business or startup must face, one of which is usually financial and tax management.

THE BLESSINGS OF FAAC DISTRIBUTIONS AND THE CHALLENGES IT POSES FINANCIALLY TO THE STATE GOVERNMENTS.

According to the latest Federation Account Allocation Committee (FAAC) Disbursement Report, released by the National Bureau Statistics (NBS), the sum of N606.20bn was disbursed in May 2020 bringing a decrease of about 22% compared to the N780.93bn from the previous month (April 2020).

The drastic decline in the revenue generated in May 2020, compared to the previous month – April 2020, is an issue of great concern and reinforces the great importance of exploiting new sectors of the economy both on the Federal and State Government levels. No need for the long story of oil not being as lucrative as it was in the past years. I assume we are all aware of this by now.

THE TAXAIDER NEWSLETTER VOL 2, ISSUE 8 (AUGUST 2020)

First Thoughts: Post-Lockdown Musings

I have often heard some people say they usually get their inspiration to write from rather uncomfortable situations and experiences. I say, ‘well done to them’. I guess I need to learn how they manage to do this. So, I’ve been in traffic for the last three hours and guys, I can’t seem to get any inspiration from this experience and putting down my ‘First Thoughts’ for today’s Newsletter has been quite a challenge. I have been looking from my laptop to the window repeatedly as we move at snail speed. Once or twice, I have been tempted to step out of the car to stretch my legs but hey, this is Lagos, and this is the Third Mainland Bridge! Anything can happen! Hopefully, I would get home before I am done with this piece.