Law of taxation in nigeria pdf

Many of the reference books were also written prior to the 2010. Iclg corporate tax laws and regulations nigeria covers common issues in corporate tax laws and regulations including capital gain, overseas profits, real estate, antiavoidance, beps and the digital economy in 33 jurisdictions. The paper in discussing the subject has focused on the principal tax legislations in the country, namely, the personal income tax act, companies. My hope however, is that other professionals, judicial officers and persons interested in the study or practice of taxation will also find it useful. Double taxation agreement dta transactions that are ordinarily not liable to tax in nigeria are not liable to withholding tax in nigeria. Law of evidence ii this is the second part of the law of evidence. Taxation and fiscal regulations in nigeria nigerian law guru. Taxation and fiscal regulations in nigeria introduction the nigerian tax system has undergone significant changes in recent times. Read it with the goal of gaining a broad understanding of tax purposes and principles. Tax system the nigeria tax system is made up of tax law, tax policy and tax administration. Administration of the tax 1 the tax shall be administered and managed by the federal board of lnland revenue in this act referred to as the board. Taxation, imposition of compulsory levies on individuals or entities by governments. Law and economics of taxation, tax avoidance and tax evasion.

Taxation in nigeria plus history of taxation in nigeria. The nigeria tax system, like any tax system, is a tripartite structure which comprises of. Principles and practice of taxation in nigeria, 2 nd ed. The principal law is the companies income tax act cita which imposes cit on profits accruing in, derived from, brought into or received in nigeria. The basis for the taxation was the islamic religion. As events unfolded, before the colonization period in nigeria, the tax system was traced to the northern parts of the country. In nigeria, nobody can dispute the fact that though this taxes are been collected, they are.

Double taxation agreements treaties nigeria has a number of tax treaties referred to as double taxation agreements with a number of countries. Shortly after the national assembly passed into law, the evidence act 2011. Taxation and revenue law casesjudgments law nigeria. This is usually, by way of a monetary charge imposed by the government on persons, entities, transactions or property to yield public revenue. Introduction to taxation our purposes, the sections on tax structure, types of tax, tax.

The sale of real estate properties is subject to a 10% tax on the gains. Abstract taxation is the nucleus and the path to modern development because it is one of the formidable options to generate revenue by government. Ordinary least square ols estimation technique is employed in estimating the specified. These will help you run your business legally in accordance with the tax laws and regulations in nigeria. The legal and institutional framework for taxation in nigeria. Nigerian law proviso sections 68 to 72 of the personal income tax.

Taxation in nigeria understanding nigerian tax system oasdom. Paying your tax as an individual or a company is nonnegotiable because tax funds serves as one of the ways the government develops the nation. Customary law taxation historical imposition and collection of tributes for the use of waterways and fishing grounds validity of competency of a native community to collect same based on historical but no longer existing sovereignty proper treatment of. Value added tax vat in nigeria is levied on all products and services traded within the country and payable to government at a 5% rate, one of the lowest in the world. In developing this argument, this thesis gives an overview of oil and gas taxation in both jurisdictions and examines the possibility of transferring laws between nigeria and canada by exploring legal and tax comparative law theories. A radical shift to indirect taxation, given the low cost of. Abiola sanni, phd, fcti senior lecturer department of commercial and industrial law university of lagos, nigeria 1. Jan, 2020 the bill also seeks to address the taxation of industries, such as insurance, startups and the capital markets, evaluated by the federal government of nigeria as critical to the growth and development of the nigerian economy with a view to stimulating activities in those sectors and fostering overall economic growth.

Federal inland revenue service firs we do our best to provide accurate and up to date information. The book simplifies the basics of nigerian taxation, discusses different laws, practice and procedures in the nigerian taxation, contains the current law position based on the latest amendments to nigerian tax laws, and treats the issue of islamic taxation and its legality under the nigerian law. Introduction following the emergence of multiplicity of taxes in the nigerian. As a result, the gb exploited the resources and people of africa. Burning issues in the nigeria tax system and tax reforms. Managing editor, nigerian tax notes a monthly journal of tax law. This book is primarily conceived for the convenience of tax officials. Department of commercial law ahmadu bello university, zaria, kaduna, nigeria email. This is in spite of the fact that ignorance is not an excuse of the law.

An appraisal of the legal framework for taxation in nigeria. Acis phd in view lecturer, faculty of law, lead city university, ibadan, nigeria 2bsc, l. From these laws, three expressions of partnerships are recognized. Aviation laws and regulations nigeria covers common issues in aviation laws and regulations including aircraft trading, finance and leasing, litigation and dispute resolution in 35 jurisdictions.

Atilola is also the editorinchief, nigerian tax law reports 19602010. The legal and institutional framework for taxation in. Below is a comprehensive analysis of taxation in nigeria and the necessary rules, laws, and clarifications. Tax types in nigeria is what many nigerians are not aware of. The division of taxing powers in a country invariably depends on the system of government, whether it is federal or unitary. The importance of taxation lies primarily in its ability to raise capital formation of government. Taxation of partners and partnerships in nigeria ololade olukowi 2 lagos, though, has since outgrown the western region. This is to ensure that the tax payable in nigeria on the profits of a nigerian company being remitted into the country are reduced by the amount of foreign tax paid abroad and vice versa. Taxation of individuals 3 monthly tax rates 3 income from employment 3 personal relief 3 contributions to retirement benefit schemes 3 interest incurred by an individual on residential premises 4 noncash benefits 4 taxation of loan benefits 5 nontaxable benefitsincome 5 taxation of overtime and bonus 5 payment to temporary and casual. Taxation in nigeria and history of taxation in nigeria a tax in nigeria is a compulsory levy imposed by the federal government of nigeria on individuals and corporate entities in respective of return of service expected from the government. Under current nigerian law, taxation is enforced by the. Sections 60 to 64 of the company income tax act as amended, and. Since then, the value added tax decree, had been amended.

Tax policy forms the basis for tax laws while tax administration is the implementation of the tax laws. The legal framework and system of taxation in nigeria. It is a practice that was hardly known to customary law. In addition to the printed version of the wwtg, individual country taxation guides are available in pdf format which can be downloaded from the pkf website at. We explore the linkages between availability of higher resource revenue and lower taxation effort of other revenue categories and the effects of these on growth. Pdf tax evasion and the law in nigeria researchgate. Chapter 2, legal framework for taxation 4 corrected by constitutional amendment, the supreme court read the amendment relatively narrowly, taking to itself the decision as to whether a statute taxed income within the meaning of the amendment. Property tax is generally a tax imposed by municipalities upon owners of real property within their jurisdiction based on the value of such property. Introduction to taxation government plays an important role in most modern economies. Government, tax administrators, practitioners and academics alike. The bill also seeks to address the taxation of industries, such as insurance, startups and the capital markets, evaluated by the federal government of nigeria as critical to the growth and development of the nigerian economy with a view to stimulating activities in. The aim of this study was to investigate on taxation and its effects in the nigeria economy. Burning issues in the nigeria tax system and tax reforms on.

Taxation and fiscal regulations in nigeria nigerian. Tax policy, tax legislation and tax administration. Obviously, everything about the nigerian taxation cannot be covered in this article, so try to click the links provided on certain text to get a wider scope and explanation. By taiwo oyedele the personal income tax amendment act 2011 was officially gazetted on tuesday 31 january 2012 with an effective date of 14 june 2011. However, tax evasion and tax avoidance are important factors to be considered as they affect both the volume and nature of government finances which is the key to economic development. Given that the purpose of introducing electronic tax system is to improve revenue collection which will in turn improve the countrys economic growth, the study empirically examined how the implementation of etaxation in 2015 has affected tax revenue, federally collected revenue and taxtogdp ratio.

Various nigerian constitutions have attempted to allocate taxing. Abiola sann, taxation in the guise of administrative charges imperative of curbing abuses of regulatory power for revenue purpose in nigeria. However, given that the laws of the federation of nigeria are compiled in several volumes, the latest comprising of 14 volumes, it follows that a person whose interest traverses more than one tax type at any given time must necessarily consult several volumes simultaneously. One of the objective carried out by the researcher was. In the united states, the role of the government extends from providing for national defense to providing social security and medicare to the elderly. Trust law and the administration of real property in nigeria ibrahim abdulkarim department of private law, faculty of law ahmadu bello university, zaria, nigeria email. In consequence, the income tax management act of 1961 was enacted and amended in 1975. A tax in nigeria is a compulsory levy imposed by the federal government of nigeria on individuals and corporate entities in respective of return of service expected from the government. Nigeria is governed by a federal system, hence its fiscal operations also adhere to the same principle, a fact which has serious implications on how the tax system is managed. Taxation and economic growth in a resourcerich country. This is in spite of the various pending memoranda and proposals for tax law reform submitted to the federal government by different stakeholders, such as nigerian insurers association, association of food, beverages and. The objective of this study is to investigate the impact of taxation on economic development of nigeria proxy by the gross domestic product gdp. A major challenge in nigeria has been the scope and usage. In other words this is the income actually earned by a taxpayer actual income.

Corporate tax 2020 laws and regulations nigeria iclg. Although the history is interesting, for 1 unit 01. This article is concerned with taxation in general, its principles, its objectives, and its effects. You dealt with law 445, law of evidence i in the last session. As an individual or a business in nigeria, you are liable to the payment of any tax and you fail to pay it, ignorance of the law cannot be used as a genuine excuse for such act of omission.

Deemed income assessment taxation generally focuses on a taxpayers earne d income. Many employers are yet to commence implementation while some. Lb, tax consultant to the oyo state government, nigeria. The emirs created a system of taxes throughout the north.

Sep 05, 2018 personal income tax amendment act, 2011 pitam is the principal act for the taxation of employees in nigeria. Items comments rate s 401 30% small company tax rate s 406 20%. Nigerian taxation law, practice and procedures simplified. It is part of the educational kit and takes the students step by step through each phase of preparation stressing key concepts, pointers and procedures. May 18, 2018 tax law and tax administration in nigeria, nigeria institute of advanced legal studies. Pdf an assessment of the prospects of property tax. This study examined the burning issues in the nigeria tax system, tax reforms, and how they affect revenue generation in river state, nigeria. Unfortunately, we are far behind on tax law reform in nigeria as the last time any business tax legislation was enacted or. The ttest was used to establish sufficient evidence that the. Data were generated through primary sources and the use of multiple regression analysis was employed. It is understood that any copying or publication or use of this thesis or parts thereof for financial gain shall not be allowed without my written permission.

Thus contracts and supplies of goods and services performed entirely outside nigeria by nonresident individuals are not liable to withholding tax. In this chapter, we examine the relationship between taxation and economic growth in a resource rich country, using nigeria as a case study. Aug 09, 2016 taxation in nigeria and history of taxation in nigeria. Looking at the history of taxation in nigeria, the beginning of the colonization period was connected with various trading posts and companies in the west africa. The british empire tried to fight for economic dominance in the region. Aviation law 2020 laws and regulations nigeria iclg. Current law and practice of value added tax in nigeria abiola sanni, department of commercial and industrial law, university of lagos, nigeria abstract the value added tax vat was introduced in nigeria in 1993 by the federal military government. The bill proposes fiscal measures in support of the 2020 budget of the federal government of nigeria the fgn, with extensive tax implications for the country.

For law officers, it also means an extra burden of having to carry several law volumes when appearing before the courts or tribunal. Tax and taxation in nigeria europeanamerican journals. May 19, 2017 law plays a significant role in fulfilling this. Impact of taxation on small and medium scale business in nigeria with abstract, chapter 15, references and questionnaire. The bill also seeks to address the taxation of industries, such as insurance, startups and the capital markets, evaluated by the federal government of nigeria as critical to the growth and development of the nigerian economy with a view to stimulating activities in those sectors and fostering overall economic growth. Taxes are levied in almost every country of the world, primarily to raise revenue for government expenditures, although they serve other purposes as well.

The role of taxation in promoting economic growth in nigeria is not fully felt, and optimal tax is not been realized that can engine economic growth primarily because of its poor administration. The federal inland revenue service firs is the federal government agency in nigeria responsible for the administration and collection of taxes. Taxation in nigeria understanding nigerian tax system. A sample size of 80 respondents, determined by the yaro yamens formula, was selected. It requires clear perception of fiscal terms and concepts as well as. Impact of etaxation on nigerias revenue and economic. Withholding tax in nigeria administration and rates. It is payable by companies that are registered in nigeria and non resident entities carrying on business in nigeria. Impact of etaxation on nigerias revenue and economic growth. Double taxation agreementstreaties nigeria has a number of tax treaties referred to as double taxation agreements with a number of countries. This form of tax is reported to be one of the most stable sources of revenue to governments however. Mar 21, 2018 these will help you run your business legally in accordance with the tax laws and regulations in nigeria. This study examined the impact of etaxation on nigerias revenue and economic growth. All companies operating in nigeria outside the oil and gas sector of the economy are.

Executive programme tax laws and practice this study material has been published to aid the students in preparing for the tax laws and practice paper of the cs executive programme. Minimum tax section 33 of companies income tax act cita cap c21 lfn, 2004 as emended jan 2009. To start, here are two basic facts about taxation in nigeria. If you earn an income in nigeria whether as an individual or a business, its expected that you remit a given amount of your earnings as tax to the government. That material was based on the law of evidence act, 2004.