Personal income tax act cap p8 laws of the federation of nigeria 2004

Nonresidents are subject to the same tax rates as residents. Nigeria with a view to affording relief from double taxation in relation to tax imposed under the provisions of this act, any tax of a similar character imposed by the laws of that country, and that it is expedient that the agreement have effect, the agreement shall have effect upon ratification by the national assembly. Federal republic of nigeria official gazette gazettes. Determination of residence under the personal income tax.

Gratuities are 100% taxexempt under personal income tax. Personal income tax act and shall apply throughout the federation except. Introduction under current nigerian law, taxation is enforced by the 3 tiers of government, i. P8 lfn 2004 was made public on tuesday, december 2011, during the presentation of the 2012 budget. The states, whose boards of internal revenue are members of the joint tax board, made out a case for the inclusion of several taxes and levies in the amended list. It also modifies the first, third and sixth schedules to the. Introduction the president of the federal republic of nigeria in line with national tax policy signed into law the bill for an act to amend the provisions of the personal income tax act, cap. The new act would provide more disposable income to the lower income earners following the amendment of the income tax table and adjustments in the applicable income tax incremental bands, which brings it in line with current income levels. Laws of federation of nigeria 2004 as amended in 2011.

Assets situated outside nigeria without prejudice to the foregoing provisions of this act, as respects any chargeable. T2, lfn, 2004 fell on the minister of finance in accordance with section 12 of the act. C2, laws of the federation of nigeria, 2004 as amended to date. Jan 26, 2014 p8, laws of the federation of nigeria, 2004 pita, it is evident that tax for any year of assessment may be imposed only by the state in which the individual is deemed to be resident for that year, maintaining that, no tax can be assessed on any individual whose residence in a state cannot be proved. C21, laws of the federation of nigeria, 2004 as amended to date. Federation of nigeria, 2004 6 section 22 of the companies income tax act, cap c21. Reappraising the rules for the taxation of income of companies. Aug 05, 2019 section 3 of pit decree 104 of 1993 now pit act, cap.

Personal income tax act amendment bill, 2011 arrangement of sections section. P8, laws of the federation of nigeria 2004, as amended by the personal income tax act amendment act, 2011 pita. Jan 28, 2020 section 1 of the personal income tax act cap p8 laws of the federation, 2004 pita imposes a tax on the income of individuals, communities, families or income arising or due to a trustee or an estate. Personal income tax act laws of the federation of nigeria. P8, laws of the federation of nigeria, 2004 pita, it is evident that tax for any year of assessment may be imposed only by the state in which the individual is deemed to be resident for that year, maintaining that, no tax can be assessed on any individual whose residence in a state cannot be proved, stressing that the rules of determination of residence are detailed out in the first. It provides, among others, that the gain or profit from an employment shall be deemed to be derived from nigeria if the duties of the employment are wholly or partly performed in nigeria or the employer is in nigeria. The division of taxing powers in a country invariably depends on the system of government, whether it is federal or unitary. Personal taxation is regulated in nigeria by the personal income tax act cap p8.

The revised edition laws of the federation of nigeria act 2007 enabled effect to be given to the revised edition of the laws of the federation of nigeria 2004, according to its short title. The content of this article is intended to provide a general guide to the subject matter. The rules in s 231c of nigerias companies income tax act on the exemption of. Tax is payable for each year of assessment on the total income of every individual, with certain exceptions, or corporation. This follows many years of agitation for the personal income tax law in nigeria to be brought in line with present day economic realities, and also to increase the compliance levels and the amount of tax. Personal income tax, whichever is applicable for the period, subject to a limit of 50% of the paye tax remitted on behalf of the employees for the same period. The above legislations itma and cita 1961 were later repealed and reenacted as the personal income tax act pita 1993, and the companies income tax act cap 60 lfn, 1990 respectively. Tax is payable for each year of assessment on the total income of every individual, with certain exceptions, or corporation sole or body of individuals who are deemed to be resident for that year in the relevant state under the provisions of the pita. However, paragraph 18 of its third schedule exempts gratuity up to the only n100,000 from tax and thereby makes gratuity above n100,000 liable to paye tax. This article is to draw your attention to the provisions of section 812 of the personal income tax act, cap p8 laws of the federation of nigeria lfn 2004, as amended, requiring every employer to file a return with the relevant tax authority of all emoluments paid to the employees for the period between january to december, not later than 31 st january of every year i. Sadly, the gazette was only made public january 2012 with the possibility that taxes computed or paid on the extant act made require some readjustment or refunds for periods prior to january 2012 since they amendment became effective june 14, 2012.

Court orders arrest of jay jay okocha daily post nigeria. This is usually, by way of a monetary charge imposed by the government on persons, entities, transactions or property to yield public revenue. Personal income tax is imposed on the income of individuals, communities, families, as well as income arising or due to a trustee or estate. Mar, 2019 it superseded the revised edition of the laws of the federation of nigeria 1990. Section 3 of pit decree 104 of 1993 now pit act, cap. P8, laws of the federation of nigeria lfn, 2004, included gratuities as an income chargeable to payasyouearn paye tax. Tax alert personal income tax residence rules ehioserogho. Vi lfn 2004 as updated and 1 st schedule to the act on goods and services exempted and zero rated goods, section 19, personal income tax act pita cap. Specialist advice should be sought about your specific. Doc general overview of the personal income tax in nigeria.

The new act would provide more disposable income to the lower income earners following the amendment of the income tax table and adjustments in the applicable income tax incremental bands, which brings it in line with current income. In addition to the reliefs and allowances, personal income tax amendment act, 2004 as amended, also provides that certain deductions shall be tax exempted under the sixth. The pitam amends deletes thirtysix sections of the personal income tax act, cap p8, laws of the federation of nigeria, 2004 pita. P8 lfn 2004 as updated to may 2007, third schedule paragraph on income of ecclesiastical, charitable or educational institution.

Public notices issued by the lagos state irs and the joint. Federal republic of nigeria official gazette tax matters nigeria. P8, laws of the federation of nigeria 2004, as amended by the personal income tax act. The personal income tax pit act, provides the conditions for deeming income taxable in nigeria. Basic requirements for filling lagos state annual returns. Jul 28, 2012 section 2 1 a and 2 of the personal income tax act, cap p8, laws of the federation of nigeria, 2004 pita provides that personal income tax shall be paid for each year of assessment on the total income of every individual based on the state where the tax payer resides, in the relevant year of personal income tax assessment. Nov 20, 2012 the pitam amends deletes thirtysix sections of the personal income tax act, cap p8, laws of the federation of nigeria, 2004 pita. Section 2 1 a and 2 of the personal income tax act, cap p8, laws of the federation of nigeria, 2004 pita provides that personal income tax shall be paid for each year of assessment on the total income of every individual based on the state where the tax payer resides, in the relevant year of personal income tax assessment, and not based on where the individual tax payer works or. The personal income tax act cap p8, lfn 2004, is now amended by the personal income tax amendment act, 2011.

Pit is regulated by the personal income tax act cap p8 lfn 2004 as. The tax to be amended include the companies income tax act, cap. Jul 23, 2018 personal income tax is imposed on the income of individuals, communities, families, as well as income arising or due to a trustee or estate. This article is to draw your attention to the provisions of section 812 of the personal income tax act, cap p8 laws of the federation of nigeria lfn 2004, as amended, requiring every employer to file a return with the relevant tax. E4, lfn 2004 which levies education tax on the assessable profits of companies registered in nigeria. The operation of this tax is governed by the personal income tax act, cap. The personal income tax act in this act referred to as the principal. Section 2 1 a and 2 of the personal income tax act, cap p8, laws of the federation of nigeria, 2004 pita provides that personal income tax shall be paid for each year of assessment on the total income of every individual based on the state where the tax payer resides, in the relevant year of personal income tax assessment, and not based on where the individual tax. P8 lfn 2004 and related matters connected therewith. Overview of the taxes and levies approved list for. The personal income tax pit act, provides the conditions for deeming. Section 1 of the personal income tax act cap p8 laws of the federation, 2004 pita imposes a tax on the income of individuals, communities, families or income arising or due to a trustee or an estate.

Over the years, various tax laws in nigeria have made provision for. Determination of residence under the personal income tax act. C21, laws of the federation of nigeria, 2004 as amended by the companies income tax amendment act 2007. It superseded the revised edition of the laws of the federation of nigeria 1990. He said that the offences contravened sections 56 a and b of the lagos state revenue administration law no. Sadly, the gazette was only made public january 2012 with the possibility that taxes computed or paid on the extant act. Whilst both lirs and jtb collectively referred to in this piece as the tax authorities placed reliance on section 16 of the pra and section 17 of the personal income tax act pita cap p8, laws of the federation of nigeria, 2004. The states, whose boards of internal revenue are members of the joint tax. Mar 05, 2018 whilst both lirs and jtb collectively referred to in this piece as the tax authorities placed reliance on section 16 of the pra and section 17 of the personal income tax act pita cap p8, laws of the federation of nigeria, 2004, as amended, as the legal basis for issuing their respective public notices. The company income tax imposes tax on the incomes of companies other than corporation soles and companies engaged in petroleum operations upstream sector. The maximum tax rate is currently 24 percent of an individual s income. No fewer than 41 clauses, including amendments to cap. In the nigerian federation, the national assembly is empowered by s. Section 2 1 a and 2 of the personal income tax act, cap p8, laws of the federation of nigeria, 2004 pita provides that personal income tax shall be paid for each year of assessment on the total income of every individual based on the state where the tax payer resides, in the relevant year of personal income tax.

Capital gains tax act, laws of the federation cap c1 lfn, 2004 as amended. Federal, state, and local government with each having its sphere clearly spelt out in the taxes and levies approved list for collection decree, 1998. Jun 28, 2017 introduction under current nigerian law, taxation is enforced by the 3 tiers of government, i. The pension reform act 2014 pra 2014 which repeals the pension reform act 2004, governs and regulates the administration of the contributory pension scheme in nigeria. The amendment became effective june 14, 2011 from the day it was signed into law by president goodluck jonathan. The effect of personal income tax amendment act on revenue. However, paragraph 18 of its third schedule exempts gratuity up to only n100,000 from tax, and thereby makes gratuity above n100,000 liable to paye tax. One of the reasons for tax defaults or even evasion among 1 see section 31 of the personal income tax act cap p8 laws of the federation of nigeria 2004as. In addition to the reliefs and allowances, personal income tax amendment act, 2004 as amended, also provides that certain deductions shall be tax. Mar, 2018 subject to the provisions of this act, the income tax that may be payable on the chargeable income of an individual ascertained in accordance with the provisions of this act shall, in respect of each year of assessment, be assessed at the rate or rates specified in the sixth schedule to this act so however that where after all deductions. Assets situated outside nigeria without prejudice to the foregoing provisions of this act. Income tax authorised communications act lawcarenigeria. Specialist advice should be sought about your specific circumstances. The pension reform act 2014 pra 2014 which repeals the pension reform act 2004.