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E-Tax is an Internet portal that is organised
around your needs, to perform your tax-related transactions with IRS. This is
to allow taxpayers to interact with IRS with greater ease and convenience as
part of our efforts to partner taxpayers in building Ogun state.
With E-Tax taxpayers can access a comprehensive
suite of transactional, enquiry and account management e-services for their
tax matters. In addition, individual taxpayers will also be able to access e-services
on behalf of organizations that have authorised them to do so.
Register for Individual Tax Identification Number
(TIN) Code Every adult resident in the state and indigenes living outside the
Ogun state are required to register to obtain the TIN code. Registration is
free and it requires less than two minutes to complete the form at the IRS E-Tax
portal. You will need to get ready the following information about yourself:
- Name
- Address
- Occupation
- Local Government
- Ward
- Town
- Date of Birth
- E-mail address
- Particulars of employer (if any paid employment)
- Phone number
- etc
Corporate
Registration
Just like individuals, every corporate body, government
institution and Non-Governmental Organisations (NGO’s) are expected to register
with the IRS to obtain a corporate TIN code. This is mandatory for all organisations,
as they are required by law to file the tax returns of their employees with
IRS on monthly basis.
- Name
- Head office Address
- Industry Sector
- Local Government
- Ward
- Town
- Name of Directors & principal officers
- E-mail address
- Contact person details
- RC Number (for companies)
On verification of the supplied information, IRS
will issue the TIN code to the organisation.
Individual taxpayers can log into E-Tax
with their personal Tax Identification
Number (TIN) Code .
Information as provided below is to assist you
to complete Income Tax Returns Form (Form A)
PART A
(i) Fill in your personal data correctly
(ii) Occupation. This implies the job you do to earn your living e.g. Civil
Servant, engineering, factory worker, farming etc.
PART B
1. State the nature of your trade, business, profession or vocation e.g. legal
practice, accounting, medicine, farming, barbing etc
2a. Indicate your annual basic salary
b. Indicate other income outside normal employment income.
c. Indicate all allowances accruable for the year from employment
3a. State dividends received in respect of investment in shares of Companies
b. State other dividends received
c. State gross amount of interest received in respect of deposits in banks
4. State pension /annuity received in respect of services rendered to employer
in the past or income from the estate of a deceased.
5. Rent: This relates to rent received by letting your property to tenants.
6. Income received in or brought into Nigeria-where such income is lodged into
domiciliary account it will be tax free.
7. Any other gains or profit not indicated above should be declared here, e.g.
Windfall such as bonanza lottery and pools winnings etc.
8. The aggregate income from all sources as indicated in 1 to 7 above.
PART C
As an employee, indicate specific allowances you are enjoying from your employment.
As self-employed individual indicate allowances you are entitled to as per expenses
you incurred on each item.
Please note that you will however, be granted allowance
as per the provision of the law.
PART D
Benefits in kind refer to other benefits apart from normal salary and allowances
provided by your employer for your personal benefit. You will please indicate
the amount which your employer incurred in providing each of the benefits i.e.
(i to ix).
PART E
Please refer to the link "Tax reliefs and Allowances"
TO ALL EMPLOYERS OPERATING THE P.A.Y.E SCHEME
IN OGUN STATE.
GUIDELINES
ON THE OPERATION OF P.A.Y.E SCHEME
Pending changes in tax policy as may be announced
by the federal Government, the P.A.Y.E guidelines for year 2004 are hereby presented
as follows:
2003 RETURNS
End of the year returns are important elements of employers
obligation to the tax authority. They are also information base for issuance
of Certificate of Pay and Tax Form 61(P) and Tax Clearance Certificate
ANNUAL P.A.Y.E RETURNS FOR 2003
By the end of February 2004, every employer is to render
to the relevant tax authority a return in respect of each employee showing the
total emolument of each employee, the relief granted (if any) and total tax
deducted from the employees emolument in the preceding year using the format
below.
s/n |
name |
Annual Basic Salary |
Annual Allowance |
Gross Pay |
Relief Granted |
Tax Paid |
Remarks |
| |
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TOTAL P.A.Y.E REMITTANCE FOR 2003
Every employer should complete the self explanatory STB
Form 55(P) in respect of 2003 P.A.Y.E remittances.
Employees whose annual total income are
not above N30, 000 need not file any return however pay 0.5% tax on such
total income.
Application for tax clearance certificate can
be made by employers, employees and self-employed individual. Application by
employee must be accompanied by:
(i) Duly completed Form DIP/TC/I
(ii) Certificate of Pay and Tax (Form 61P) for the three (3) preceding years
(iii) Original copy of relevant tax clearance certificate (TCC) earlier obtained.
(iv) Annual PAYE returns if not yet rendered.
Application by self-employed taxpayer should be accompanied by:
(i) Duly completed Form DIP/TC/I
(ii) Assessment notices for the three (3) preceding years
(iii) Assessment notice for the current year
(iv) Tax receipts evidencing the payment of amount in the assessment notices
(v) Original copy of the relevant tax clearance earlier obtained
All the district tax offices as well as the Central PAYE Section in the headquarters
are authorized to process the application for tax clearance certificate which
should reach the headquarter at least two weeks in advanced of collection.
Please note that unless the above requirements are met,
applications made will not be processed.
All employers are expected to forward to
our relevant tax office the nominal roll/details of their employees as at 1st
January not later than February, using the format below:
s/n |
Name |
Salary P.A |
Allowances |
Total Emolument |
| |
|
|
|
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Tax Forms (form ‘A’) in respect of number of employees
in the nominal roll submitted will be supplied free of charge to employees through
their employers. Employers should approach the relevant Tax Officers to collect
the Form ‘A’. Furthermore, employers should certify the correctiveness of the
salaries and allowances declared in the forms by their employees in order to
facilitate the granting of all legitimate claims.
Employees whose forms are not fully properly completed
may experience delay in the course of processing their assessment notices.
It should also be noted that failure to make a return or declaration of incorrect
or inaccurate return is a criminal offence punishable by payment of penalty
and or imprisonment.
Automated assessment/coding of employees based
on the completed forms are now being handled by the Directorate of Assessment
in the Headquarters at Oke-Mosan. Employers of labour are hereby enjoined to
forward the completed forms to the Directorate of Assessment through the relevant
tax office not later than 30th April 2004. Directorate of Assessment will process
the completed forms with dispatch and forward the assessment notices to the
employer through the relevant tax offices.
Please note that any form received after
30th June may not be processed and code ‘0’ denoting Nil Tax Relief
will be applied to such case as from 1st of July,2004.
The Board in line with the law permits self assessment
by taxpayer. Self assessment has to do with a situation where a tax payer files
his/her return with the computation of tax payable.
| |
1998 -2004 |
Personal Allowance |
20% of Earned Income + N5,000 |
Claims for Children |
N2,500 per child Maximum of 4 Children |
Dependant Relative |
N2, 000 per dependant subject to a maximum of
2 dependants |
Life Assurance Relief |
Amount paid (Life Assurance and Contribution to Approved
Pension Scheme) under Allowances |
All claims for children allowance shall continue to be
supported by photocopies of birth certificate and or receipts of school fees
paid
RENT ALLOWANCE
Where the employer pays directly to the employee the allowances is 100% of the
annual basic salary or N150,000 whichever is lower.
TRANSPORT ALLOWANCE
The maximum non taxable allowance with effect from 1st January 2001 is N20,000.00
per annum.
LEAVE ALLOWANCE
A maximum sum of 10% of annual basic salary of the taxpayer is allowed from
1/1/1999. Any amount in excess of this is therefore taxable.
MEAL SUBSIDY/ALLOWANCE
The upper limit of tax exemption for meal subsidy/allowance is N5, 000.00
per annum with effect form 1/1/1999.
UTILITY
ALLOWANCE
The maximum limit of tax exemption for utility allowance is N10,
000.00 per annum with effect from 1/1/1999.
ENTERTAINMENT ALLOWANCE
The upper limit of tax exemption on Entertainment Allowance is N6, 000.00
per annum with effect from 1/1/1999
NIGERIAN SOCIAL INSURANCE TRUST FUND (NSITF) ALLOWANCE
Nigerian Social Insurance Trust Fund (NSITF) allowance is 3.5% of Annual (Basic
Salary plus Housing Allowance plus Transport Allowance).
DISABILITY
ALLOWANCE
Disability allowance of N3, 000.00 is granted to a disabled person to
a disabled person per annum if that person should be using special equipment
and the services of an attendant in the course of his employment. The amount
is to be limited to 10% of his earned income.
LIFE ASSURANCE AND CONTRIBUTION TO APPROVED PENSION
SCHEME
The restriction on approved claims in respect of premium paid has been removed.
It should be carefully noted that tax payers are expected to attach the photocopies
of their insurance certificate and receipts as proof of their claims while at
the tax office(s)
Interest on loan in respect of owner occupier
remains an allowable expense. However, documentary evidence is to be produced
to justify claim.
INTEREST ON LOAN EMPLOYED AS CAPITAL
Interest on loan employed as capital to acquire the income to be taxed is an
allowable expense.
Fringe Benefits are taxable whether they
are monetized or in kind
(a) Employer’s asset put in the employees’ use: 5% acquisition cost if known
or5%of the market value of the asset at the time of acquisition. If the asset
is a car, it is 5% of cost + maintenance cost.
(b) Where an employer rents or hires an asset which he puts into the use of
an employee, the employee will be charged with the difference between the amount
incurred by the employer and any amount refunded to the employer by the employee.
(c) Where an employer engages the services of steward, driver, washman, housemaid
etc; for the personal benefit of an employee, the remuneration paid to these
people is taxable in the hands of the employee that enjoys their services.
(d) Where free accommodation is provided by the employer to the employee, the
rateable value of the property will continue to be used in arriving at the Benefit-in-kind
of the employee for tax purpose.
10.1 The following benefits are exempted from tax.
(i) Meal in the employer’s canteen or non-transferable luncheon vouchers.
(ii) Uniforms, overall or protective clothing
(iii) Removal expenses.
(a) Official Emoluments of President and
Governor
(b) Official Emoluments of Vice President and deputy Governor.
(c) Diplomat Income
(d) Wound and Disability Pensions
(e) Gratuities paid to Private Sector Employees
(g) Pension paid to Public Servants.
(h) Compensation for loss of employment
(i) Income earned outside Nigeria and deposit in a domiciliary account in an
authorized bank.
(J) Income of Trade Union registration under Trade Union Act.
(k) Income of Local Government or Government Institution.
PERSONAL INCOME TAXES
The
law authoring the Tax is the Personal Income Tax Act No 104 of 1993
The
Personal Income Tax is a tax payable by all individuals and registered businesses
and partnership except those registered under Part A of Companies and Allied
Matters Act 1990. Thus every taxpayer in the state is liable to pay tax on the
aggregate amount of his income whether derived from within or outside the state/country,
the salaries, wages, fees, allowances, and other gains or benefits, given or
granted to an employee are chargeable to tax. The Employers of labour are deemed
to be agents of the tax authority for the purpose of remitting taxes deducted
from salaries due to employees.
Residency of a taxpayer determines the extent of
a taxpayer’s liability in Nigeria. A person’s place of residence
for this purpose is defined as a place available for his domestic use in Nigeria
on a relevant day, excluding hotels, and rest houses.
A person is deemed resident in Nigeria if he resides in Nigeria for 183 days
in any 12-month period. Expatriates holding residence permits are liable to
tax in Nigeria even if they reside in the country for less than 183 days in
any 12-month period. Once residence can be established, the relevant tax authority
of the territory is the tax authority in which the taxpayer has his place of
residence or principal place of business.
The following are however exempted from tax:
i. Medical or dental expenses incurred by the employee.
ii. Retirement gratuities and compensation for loss of office.
iii. The cost, any passage to or from Nigeria incurred by the employee.
iv. Interest on loans for developing an owner-occupied residential house.
v. Leave allowance, which is computed as 10% of annual basic salary subject
to a maximum of N7, 500 per annum
The table below is applicable with effect from
1st January 2001.
The rates are as follows:
| Income to be Taxed |
Rate of Tax |
|
Percentage |
| For every Naira of the first |
N30, 000
|
5k per N |
5% |
| For every Naira of the first |
N30, 000
|
10k per N |
10% |
| For every Naira of the first |
N50,000
|
15 per N |
15% |
| For every Naira of the first |
N50,000
|
20k per N |
20% |
| For every Naira of the first |
N160,000
|
25K per N |
25% |
WITHHOLDING TAXES
The Personal Income Tax Decree No. 104 of 1993,
(as amended) subject certain activities and services to withholding tax. Where
during a transaction in any of the specified activities or services, a payment
is due from one person to another, the person making the payment is expected
to deduct tax at the applicable rate and remit same to the relevant tax authority.
This should be done not later than 30 days after the deduction. This provision
can be found in sections 68 to 72 of the These activities and services include
rent, construction, dividend, royalties, commission, professionals, technical
and consultancy fees.
It is an advance payment of tax (at 10%) to which individuals
and organizations are entitled to demand a withholding tax credit note.
Rent, dividend, interest etc, will continue
to be subjected to deduction at source based on applicable rates below: The
agents of government for deduction and remittance of withholding taxes include
Government Departments, Parastatals, Statutory bodies, Institutions and other
establishments approved for the operation of PAYE Scheme.
| Types of Payment |
Applicable Rate |
| Dividends, interest, rents, Directors fees, royalties |
10% |
| Directors, professional service, management services
and technical fees |
5% |
| Construction |
5% |
| Contract supplies |
5% |
Withholding tax of capital must be remitted thirty (30)
days from the day the tax is withheld
The rates of capital Allowances for Personal
Income Tax purpose are as follows:
|
Initial Allowance |
Annual Allowance |
| Building (Industrial and non-industrial mining |
15% |
10% |
| Mining |
95% |
- |
| Plant (Agricultural production) |
95% |
- |
| Plant (others) |
50% |
25% |
| Furniture & fittings |
25% |
20% |
| Motor Vehicle Others |
50% |
25% |
| Public Transportation |
95% |
- |
The law authoring the Tax
is the Capaital Gains Tax Act Chapter 42 LFN. 1990
All gains accruing to a taxpayer from the sale, lease or other transfer of proprietary
rights in a chargeable interest are subject to a capital gains tax of 10%. Such
chargeable assets may be corporeal or incorporeal and it does not matter that
such asset is not situated in the state/country. Where the taxpayer is a non-resident
company or individual, however, the tax will only be levied against the amount
received or brought into the state/country.
A 10% tax imposed
on Capital Gains arising from a sale, exchange or other disposition of properties
known as chargeable assets.
The current rate is 10% of Gains on disposal
of chargeable assets after deducting the following allowable expenses/expenditures
(a) Cost of acquisition of assets
(b) Cost enhancement of value of the assets and or cost of bringing the assts
to a saleable condition.
(c) Incidental costs such as advertisement, legal fees etc.
Please attach documentary evidence to support your claims.
POOLS
BETTING, LOTTERIES, GAMING AND CASINO TAXES
Development levy of N100 per annum will
continue to be paid by every taxable adult in the state in line with Ogun State
Development Levy Edict No. 6 of 1995 as amended and Federal Government guide
line on Harmonization of Revenues of labour should effect deduction in the month
of April and remit same by May, 2004.
The following are the other taxes collected by
the Board apart from the aforementioned.
TAXES |
TAX PAYERS |
OFFICE OF VISIT |
| Road Taxes |
Drivers and Vehicle Owners who are to pay the statutory
fees for registration of vehicle, plate number, renewal of vehicle licence,
Driver’s licence, etc
|
Motor Licensing Sections in Areas and District
Tax Offices across the state. |
| Haulage fees |
Quarry companies and individuals who are to pay
the statutory/prescribed fee. |
Headquarters, Oke-Mosan, Abeokuta |
| Stamp Duty |
Individuals who are to pay statutory/Prescribed
fees for contract agreement, land agreement, power of attorney etc |
Zonal Offices in Abeokuta, Ijebu Ode,Sagamu, Ota
and Ilaro |
| Other Revenue |
Pools promoters, pools agents, casino Operators
etc who are to pay the statutory/prescribed fees for registration, renewal
of licence, weekly taxes etc.
|
Other Revenue Section in the headquarters |
The Internal Revenue Service, Ogun State
collects taxes through Direct Bank Lodgment. All taxpayers should therefore,
pay directly to Board of Internal Revenue, Ogun State Government Account at
the designated banks within the jurisdiction of the Relevant Tax Office. Any
payment to an individual or agents is at the taxpayer’s risk. It is necessary
to stress that employers must remit PAYE deductions of employees within ten
(10) days of end every month.
Penalty and Interest are charged on late remittance
Where it is validly confirmed that a tax payer
genuinely over paid tax for a particular year of assessment, the Board in the
spirit of equity will issue tax credit note for the amount over paid to the
affected tax payer.
Any person who disputes an assessment made upon
him may apply to the Executive Chairman of Ogun State Board of Internal Revenue,
Oke- Mosan, Abeokuta by notice of objection in writing, to review and revise
the assessment made upon him. Such application shall
(i) State precisely the grounds of his objection to the assessment
(ii) be made within thirty days after the date of service of the notice of assessment.
Any individual who is not satisfied with the result of the review may appeal
to the Body of Appeal Commissioners.
OBJECTION AND APPEALS
Failure to deduct or Account for Deduction Failure to deduct
tax from emolument of employees or failure to remit tax deducted to the Ogun
State Board of Internal Revenue through the designated bank is an offence.
Penalty
(i) Payment of the correct amount of tax that should have been deducted or remitted.
(ii) Payment of additional 10% of the tax not deducted or remitted.
(iii) Payment of 21% or the prevailing bank interest on the amount not deducted
or remitted.
FAILURE TO RENDER TAX RETURNS
Failure to render tax returns as required by tax authority and in line with
the law is punishable on conviction.
Penalty
Payment of Five Thousand (N5,000.00) Naira or Six (6) months imprisonment.
FAILURE TO PAY TAX/TAX EVASION
It is a serious offence not to pay tax or to deliberately give false information
with a view to paying less tax.
Penalty
(i) The taxpayer will pay N1,000.00 fine and three times the amount of
tax that should have been paid or
(ii) Imprisonment for six month or
(iii) Payment of N1,000.00 fine and imprisonment for six month.
These are terms you will see in the Assessment Notice and
Income Tax Return Form (Form A)
(i) Relevant Tax Authority means
tax authority of the territory in which an individual is deemed to be resident.
(ii) Assessment Year: this means
a period of twelve (12) months commencing from 1st of January and ending on
31st December of each year.
(iii) Chargeable Income: Income,
gains or profits on which tax may be imposed
(iv) Assessable Income: This means
the amount of income from each source for a year assessment
(v) Total Assessable Income: This
means the aggregate amount of income from all sources. Any source which produced
loss will not be aggregated with the source which produced profit, unless under
special circumstance.
(vi) Total Income: This means
total assessable income from all sources after deducting losses and capital
allowances.
(vii) Taxable Income: This means
the amount of an individual total income less personal reliefs
(viii) Earned Income: This refers
to income which requires the exertion of physical or mental ener3:20 PM 9/4/2006
i.e. salary, Wages, Allowances, Business profits etc.
(ix) Unearned Income: This refers
to income that does not require the exertion of physical or mental energy i.e.
rent, interest, dividend etc. Please note that dividend is a final tax only
for a non-resident tax payer.
(x) Capital Allowance: This refers
to allowance given in lieu of depreciation in respect of assets used in producing
income to be taxed. See 14.0 for rates of initial and annual allowance.
(xi) Balancing Allowance: This
refers to allowance given to the advantage of tax payer to offset the amount
by which the tax Written Down Value exceeds the Disposal Value of Asset used
in producing income to be taxed.
(xii) Balancing Charge: This refers
to amount imposed by tax authority on the taxpayer to offset the amount by which
Disposal value exceeds the Tax Written Down Value (TWDV) of assets used in producing
income to be taxed.
(xiii) Basis of Assessment: Business
Profit, Rent, Interest, Dividend are being taxed on Preceding
Year Basic (PYB) that is, the aforementioned income for last
year will be taxed in the current year.
Salary, commission, allowance, etc. are being taxed on Actual Basis, that is
aforementioned income are being taxed in the year in which they are earned i.e.
employees’ salaries and allowances.
(xiv) Best of Judgement Assessment:
This refers to assessment raised on taxpayer
(i) Where no return is filled at the expiration of the stipulated time
(ii) Where the return filed is unacceptable to the Board.
(xv) Additional Assessment: This
refers to assessment raised where it is discovered that tax paid less than what
he/she ought to pay. The assessment may cover a period of six (6) years.
(xvi) Amended Assessment: Where
there has been a successful objection to an Assessment,the Inspector of Taxes
must issue an Amended Assessment.
(xvii) Self-employed taxpayer must settle tax due within two (2) months after
service of notice of assessment if there is no objection to the assessment.
(xviii) The Board permits self-employed tax payers to make instalmental
payments of final and conclusive tax assessments. However such
request must be received in good time.
(xix) Notice of Refusal to Amend:
Where the Inspectors of taxes refuses to amend an Assessment after an objection
has been raised and the taxpayer disagrees with the Assessment, the taxpayer
should request for a Notice of Refusal to amend.
With this Notice, the taxpayer can proceed to the Body of Appeal Commissioners.
(xx) The law empowers tax authority to call for returns, books, documents and
information for assessment purpose.
(xxi) The law empowers tax authority to distrain/seize
properties of recalcitrant payers.
(xxii) Tax defaulters may be prosecuted in law
court with a view to recovering outstanding taxes.
(xxiii) The trial of defaulters may be publicized
through newspapers, radio and television
Mr. Francis Eleyodollar, an employee of Mighty
Power Plc, Ota resides in Ijoko-Ota. He earns N240, 000.00 as basic salary
and received a productivity bonus of N20,000.00 in 2003. He has the following
allowances: Housing - N175,000.00, Transport - N40,000.00, Utility
- N15,000.00, Entertainment N 10,000.00, Meal Subsidy - N5,000.00.
Mr. Eleyodollar uses the company car purchased at cost of N300,000 and
the company incurred maintenance cost of N60,000 on the car in 2003.
Mr. Eleyodollar’s poultry farm at Iyana-Iyesi Ota fetched him N60,000.00
in 2002, and this amount was accepted by the Tax Authority. In 2002, he also
received N10, 800 as net dividend from Yakoyo Breweries, Ota and N24,
000 as rent from tenants in his three-bed-room flat in Ijoko-Ota. Long Life
Insurance collects annual premium of N30, 000.00 from Mr. Eleyodollar
on a life assurance policy. Mr. Eleyodollar has (6) children and three (3) dependant
relatives. Complete tax payable by Mr. Eleyodollar in year 2003
SOLUTION
MR FRANCIS ELEYODOLLAR
Computation of tax payable for 2003 Year of Assessment
| Earned Income |
N |
N |
| Salary |
|
240,000 |
| Productivity Bonus |
|
20,000 |
Housing (N175,000 - N150,000) |
|
25,000 |
Transport (N40,000 - N20,000) |
|
20,000 |
Utility (N15,000 - N10,000) |
|
5,000 |
Entertainment (N10,000 - N6,000) |
|
4,000 |
Meal Subsidy (N5,000 - N5,000) |
|
-- |
BIK (5/100 x N300,000) + N60,000 |
|
75,000 |
| Poultry Farm (Business Profit) |
|
60,000 |
| Earned Income |
|
449,000 |
| Add: Unearned Income |
|
|
Dividend Gross |
|
|
(10,800 /90%) |
12,000 |
|
Rent |
24,000 |
|
| Total Unearned Income |
|
36,000 |
| Total Income |
|
485,000 |
|
|
|
| Deduct: Personal Reliefs & allowance |
|
|
Personal Relief |
|
|
(20% of 449,000 x 5,000) |
94,800 |
|
Children Allowance (2500x4 See 7.0) |
10,000 |
|
Children Allowance (2500 x4) |
|
|
Dependant Relative |
|
|
Allowance (2000 x2) |
4,000 |
|
| Life Assurance Relief |
30,000 |
138,800 |
| Taxable Income |
|
346,200 |
Tax payable on Taxable Income of N346,
200 based on current rates is at follows: |
|
|
N |
| The first 30,000 at 5% |
|
1,500 |
| Next 30,000 at 10% |
|
3,000 |
| Next 50,000 at 15% |
|
7,500 |
| Next at 50,000 at 20% |
|
10,000 |
N186, 200 at 25% |
|
46,550 |
|
|
68,550 |
Less withholding tax on dividend deducted at source
(10% of N12, 000) |
|
1,200 |
| Net Tax Liability |
|
67,350 |
| |
|
|
Notes:
* The Relevant Tax Authority is Internal Revenue Service, Ota (see Question
and Worked Example)
* Salary, Bonus and Allowance were assessed on Actual Basis - (see Question
and Worked Example)
* Rent and Dividend were assessed on Preceding year Basic(PYB) - (see Question
and Worked Example)
* Earned Income is associated with those earnings which result from Personal
Effort
* Unearned Income is associated with Investments.
* Withholding tax on Dividend is not a final tax for a resident, hence the reason
for grossing it up and thereafter deducting the amount suffered at source from
final tax liability.
* It is necessary for self-employed tax payers to submit profit and loss account,
balance sheet and or audited accounts.
* This will give room for granting of capital allowances, balancing allowance
and other expenses.
* It is pertinent to note that decisions as to whether the expense is WHOLLY,
EXCLUSIVELY, NECESSARILY AND REASONABLY incurred in the production of income
to be taxed.
* Though N60, 000 declared as profit from Mr. Eleyodollar’s Poultry Farm
was accepted by the Tax Authority, in some cases, there may be need to disallow
some expenses and compute adjusted profit.
With effect from January, 2004 the production
of current tax clearance certificate (T.C.C.) will be a precondition for admission
of pupils/students into primary schools, secondary schools and tertiary institutions.
That is, pupils/students who failed to produce the T.C.C. of parents/sponsors
will henceforth not be allowed to stay in the classrooms. Furthermore, the provision
of the tax law which makes the production of tax clearance certificate a precondition
for the underlisted transactions is still in force.
(a) Application for Government Loan
(b) Registration of Motor Vehicle
(c) Application for Firearms Licence
(d) Application for Foreign Exchange
(e) Application for Certificate of Occupancy
(f) Application for award of Contract by governments or its agencies or registered
companies
(g) Application for Trade Licence
(h) Application for Agent Licence
(i) Application for Pools Agent Licence
(j) Application for Distributorship
(k) Allocation of Market Stall
(l) Registration of Limited Liability Company
(m) Appointment or Election into public office
(n) Confirmation of appointment by Government as chairman or member of Public
Board, Institution, Commission, Company or any other similar position made by
the government.
(o) Application for registration as a Contractor
(p) Application for plot of land.
Any Ministry or Department or Agency of Government or a Commercial Bank with
a person has any dealing with respect to any of the aforementioned transactions
is hereby enjoined to demand from the person a current Tax Clearance Certificate.
Every taxpayer in Ogun State has:
(i) the right to pay what is fair and just
(ii) the right to object to an assessment that is excessive
(iii) the right to fair hearing and treatment.
(iv) the right to appeal to the Body of Appeal Commissioners to revise an assessment.
(v) the right sue the Board of Internal Revenue (BIR) to Revenue Court where
he/she does not agree with the Body of Appeal Commissioners.
(vi) the right to sue BIR to the Supreme Court on point of law.
Every taxpayer in Ogun State is obliged
(i) to pay taxes, levies and fees regularly
(ii) to be a good citizen and law abiding
(iii) to support the state Government to succeed
(iv) to ensure that government properties are not destroyed
The banks approved for Direct Bank Lodgement
Scheme (DBLS) are
(1) Bond Bank
(2) Guaranty Trust Bank
(3) Wema Bank
(4) National Bank
(5) Gateway Bank
(6) Lafenwa Community Bank
(7) Equatorial Trust Bank
(8) United Bank for Africa (UBA)
However, where none of the aforementioned banks is available in your locality,
you should please make enquiry at our local offices nearest to you.
Please do not pay to any agent or individual.
Make sure you personally pay into Ogun State Government Account at any of the
designated banks approved for Direct Bank Lodgement Scheme (DBLS).
The banks are on-line; you can therefore make
your lodgement into any of the banks in the state.
Please feel free to ask questions on any part
of this book. Our Inspectors of Taxes are waiting to assist you.
The IRS hereby appeals to all payers and employers
of labour both in the public and private sectors, to ensure strict compliance
with the contents of this book in order to ensure a hitch-free year assessment.
Thank you.
Morenike Babington- Ashaye (Mrs.)
Chairman,
Board of Internal Revenue,
Ogun State.
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