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  Some Aspects of our Tax Laws Affecting your Business

Some Aspects of our Tax Laws Affecting your Business



Some aspects of our tax laws affecting your business include the following:

a. All goods manufactured/assembled in or imported into Nigeria, except those specifically exempted under the law are VATable goods.

b. All services rendered by any person in Nigeria except those specifically exempted under the law are VATable services.

c. Where organizations make part payment to contractors, the corresponding VAT should be deducted and remitted for any payment made.

d. Non deduction or failure to collect tax by a taxable (VATable) person attracts a penalty of 150% of the uncollected tax plus 5% interest above the Central Bank of Nigeria’s discount rate.

e. Ministries cannot issue contractors with receipts for VAT payment in place of Federal Inland Revenue Service receipt. Receipt acknowledging payment is only issued by the Federal Inland Revenue Service.

f. All companies/organisations that have been in existence before the VAT Act came into operation in 1993 were expected to register for VAT within six months from the date of commencement of the Act. New companies that came into operation after the commencement of the Act are expected to register for VAT within six months of commencement of business.

g. Failure or refusal to register with the Federal Tax Authority within the specified time makes the tax payer liable to a penalty of N10,000 for the first month in which the failure occurs and N5000 for each subsequent month in which the failure continues. If this persists, the premises where the business is carried on shall be sealed up.

h. Failure to remit tax attracts a penalty of a sum equal to 5% per annum plus interest at a commercial rate payable within 30 days of notification by the Tax Authority.


In view of the above provisions, it is advised that VAT be isolated and not included as part of the total invoice value of any contractual transaction. Please note that VAT is paid as an addition to the contract sum by the consumer of the good/services. 

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07:24:00  Corporate Law Practice, Federal Inland Revenue Service (FIRS), FIRS, LAW PRACTICE, Practice, Tax, Tax Lawyer, Tax Services, Taxpayer, Uyo Tax Lawyer, VAT

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