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

Proshare

Friday, November 08, 2019   /10:23 AM / News / Header Image Credit: Daily post Nigeria


A Bill to amend various tax laws in Nigeria is currently undergoing legislative process at the National Assembly. The 2019 Finance Bill which was presented to the Legislature by President Muhammadu Buhari along with the 2019 Budget seeks to introduce sweeping changes.

Below are some of the important changes you should know about:

Excess dividend tax to apply only to untaxed distributions other than profits specifically exempted from tax and franked investment income.

Proshare Nigeria Pvt. Ltd.

Companies Income Tax Act, Cap. C21, Laws of the Federation of Nigeria, 2004 (as amended to date)

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

 

Proshare Nigeria Pvt. Ltd.


Value Added Tax Act, Cap V1, LEN 2007 (as amended)

Specific requirement for VAT deregistration for discontinuing operations

Introduction of VAT reverse charge on imported services

VAT registration threshold of N25 million turnover in a calendar year to be introduced

Remittance of VAT now to be on cash basis, that is, difference between output VAT collected and input VAT paid in the preceding month

Compensation for loss of employment below N10m to be exempted from CGT.


Stamp Duties Act Cap $8, LFN 2007

Stamp duty on bank transfer to apply only on amount from N10,000 and above. Transfers between the same owner's accounts in the same bank also to be exempted.

 

Download Here - 2019 Finance Bill


Proshare Nigeria Pvt. Ltd.


Related News

  1. Nigeria: We Live In Taxing Times! But Should Government Increase VAT Rate?
  2. Companies Operating In Nigeria To Pay 0.005% Net Profit Levy Under The NPTF (Establishment) Act 2018
  3. Matters Arising On VAT - Income Model vs Gross Product Model
  4. MTEF Review: VAT Increase Could Be A Smoke Screen For Something Larger
  5. TAT - It Is Illegal To Impose Tax Based On Taxes And Levies Act Without A Primary Taxing Law
  6. Companies Operating In Nigeria To Pay A New Police Fund Levy
  7. FEC Approves Increase In VAT To 7.5% From 2020, To Seek NASS Approval For Enabling Law
  8. Tax 101 - How The Proposed VAT On Online Transactions Will Affect You
  9. N311.94bn Generated As VAT in Q2 2019 - NBS
  10. LIRS Issues Public Notice on TIN Registration; To Leverage On The Existing BVN Operations
  11. Increase VAT Gains through Efficient VAT Management
  12. Fowler Calls For Increase In VAT Collection in Nigeria
  13. Implications Of FGN's Increase Of VAT Rate To Pay For The New Minimum Wage
  14. FG Revises Excise Rates For Specific Products
  15. Value Added Tax Modification Order For The Power Sector
  16. The Income Tax (Transfer Pricing) Regulation, 2018- Is This A Game Changer?
  17. An Overview of Nigeria's 2018 Income Tax (Country By Country Reporting) Regulations
  18. FG to Remove VAT on Residential Properties, Amends Company Income Tax Law
  19. Financial Services Agents Call On CBN To Address Stamp Duty Charges
  20. RMAFC Set to Audit Deposit Money Banks Over Stamp Duty Collections
  21. N50 Stamp Duty: Banks begin execution, lists exemptions but still have many issues unanswered

Proshare Nigeria Pvt. Ltd.

Proshare Nigeria Pvt. Ltd.
READ MORE:
Related News
SCROLL TO TOP