A quick guide to taxation in liberia 2013 2013 tax facts mozambique namibia nigeria the annual personal income tax of every resident individual in liberia is. Re: what is pay as you earn(paye) tax system in nigeria reply by felix okoli on thursday march 15, 2012 at 9:28:22: paye means pay as you earn it is a tax system derived from the personal income tax act in nigeria which is a method of tax calculation on the income of persons. Productivity of personal income tax system in nigeria is the purpose of this study 20 literature review ariyo (1997) points out that the proportion of self.
The income, profit or gain of an individual shall be deemed to be derived from nigeria and liable to personal income tax in nigeria if the employer of the individual is in nigeria or has a fixed base for doing business in nigeria. Pursuance to the personal income tax (amendment) act, 2011, the administration of the personal income tax is vested on the state internal revenue service (sirs) in each state and the federal capital territory (fct) abuja. The personal income tax act (pita) as amended provides for consolidated relief allowance (cra) of n200,000 or 1% of gross income whichever is higher plus 20% of gross income.
Theneed to tax personal incomes throughout the country prompted the income tax management act (itma) of 1961in nigeria, personal income tax (pit) for salaried employment is based on a pay as you earn (paye) system,several amendments have been to the 1961 itima act. Nigeria corporate tax rate in nigeria, the corporate income tax rate is a tax collected from companies its amount is based on the net income companies obtain while exercising their business activity, normally during one business year. Personal income tax (pit) is the oldest tax system in nigeria which was first introduced as a community tax in northern nigeria in 1904, before the unification of the country in 1914, and later implemented during the course of the national revenue ordinances to the western & eastern regions in 1917 and 1928 respectively. Nigeria personal income tax amendment act 2011 the long awaited amendment to the nigerian personal income tax act 2004 came into being in december 2011, without much fanfair this act, provide the nigerian employee a huge tax cut. This is a welcome development in the tax administration system in nigeria, as the objective is to simplify the tax compliance process and cut out inherent inefficiencies it is instructive to note that wht is not a separate type of tax but an advance payment of income tax.
The nigerian personal income tax is based on a pay-as-you-earn system (paye) and the scale is graduated from a minimum percentage of 7 percent of taxable income to a maximum of 24 percent of. Company income tax in nigeria - overview of company income tax law and practice in nigeria the taxation of the profit of the companies is under the company income tax 1990 the term company for the purpose of cita 1990 is defined under s84 to mean any company or corporation (other than corporation sole or partnership established by or other. To collect personal income tax on the income of an individual resides in the tax authority of this place of residence and not, that of his place of work in shittu v nigeria. Manner in which taxation is being used as a fiscal policy instrument for income redistribution and economic development it is intended to offer suggestion at improving the overall nigeria tax system in order to enhance. First becomes liable to income tax in nigeria for that year by reason of his entering that employment during that year, shall be deemed to be resident for that year in the territory in which the principal office of his employer is situated on that day or on the day his foreign.
Not payment/remitting taxes is an offence under the relevant personal income tax laws, and failure to pay tax can result in an imposition of an additional 10% of the amount of tax not paid/remitted, in addition to the amount of tax due, and any costs incurred in the recovery of the sums due. Companies income tax in nigeria / personal income tax in nigeria / business and income schedule monthly for a company based on the personal income tax act. Home tax resources tax-types this page is under construction. In nigeria, the taxation system dates back to 1904 when the personal income tax was introduced in northern nigeria before the unification of the country by the colonial masters it was later implemented through the native revenue ordinances to the western and eastern regions in 1917 and 1928, respectively.
The purpose of this study is to analyze the system of personal income taxation in nigeria, especially with respect to its administration, equity, and effects on efficient resource usage. Nigeria foreign services, persons resident within the federal capital territory, abuja and persons employed in the nigeria police force (other than in a civilian capacity) are to pay their taxes to the federal inland revenue.
The latest representations of these tax laws are the personal income tax act 2004 and the companies income tax act 2004 current tax situation in nigeria according to the nigerian laws, there are three legal bodies that can levy the taxes on nigerians. (4) personal income tax act (pita) the legal basis for this tax is found in the provisions of the personal income tax decree [now act] 104 of 1993 every taxpayer in nigeria is liable to pay tax on the aggregate amount of his income whether derived from within or outside nigeria, the salaries, wages, fees, allowances, and other gains or. Corporate income tax and personal income taxes funmi's work experience has involved clients in the consumer market, telecommunications, construction, fashion and shipping industries.