The Key Changes In The 2019 Finance Bill - Focus on Taxation

Small businesses with turnover less than N25m to be exempted from Companies Income Tax

A lower CIT rate of 20% to apply to medium-sized companies with turnover between N25m and N100m

Commencement and cessation rules modified to eliminate overlaps and gaps to avoid double taxation and complication during commencement

Minimum tax provisions amended to 0.5% of turnover and exemption only applies to small companies (less than 25m turnover), so non-resident companies will now pay minimum tax

Insurance companies can now carry forward tax losses indefinitely, deduct reserve for unexpired risks on time apportionment bases while special minimum tax for insurance has been abolished

Bonus of 2% of tax payable (medium-sized companies) and 1% for large companies for early payment of CIT

Introduction of thin capitalisation of 30% of EBITDA for interest deductibility. Any excess deduction can be carried forward for 5 years

Deemed tax presence for non-residents with respect to imported technical and management services now taxable at a final WHT rate of 10%

Any expense incurred to earn exempt income now specifically disallowed as a deduction against other taxable income

Dividend distributed from petroleum profits now to suffer 10% withholding tax

Banks to request for Tax Identification Number (TIN) before opening bank accounts for individuals, while existing account holders must provide their TIN to continue operating their accounts

Email correspondences to be recognised for communicating with tax authorities

The meaning of supply and definition of goods and services has been expanded to cover intangible items other than land, among others