Tax authorities previously focused only on PAYE tax but are now asking questions regarding other incomes from rental, 'side-hustle', trading or professional activities that individuals need to declare.
The Personal Income Tax Act (PITA) requires every individual to file a return of their income on or before 31st March every year. This applies to all individuals whether self-employed, high net worth individuals under direct assessment or those in paid employment under the PAYE regime. The individual filing obligation is separate from the PAYE tax returns which the employer makes in respect of employment income paid to staff.
The deadline for personal tax returns is 31st March but this has been extended in Lagos by the LIRS for 2 months till 31st of May. We recommend that you file much earlier as the tax authority's server may not be able to deal with the rush towards the last day. Non-compliance is liable to penalties, you can read about the LIRS intention to penalise late filing here.
TaxTim, a web-based chat bot, can help taxpayers correctly compute their taxes online with the help of a virtual assistant called Tim, so that they can file the correct amount to the tax authorities.
If you require assistance identifying all your income, available incentives and all your deductions, as well as computing what your tax should be on your total income, PwC Nigeria's online tax assistant called 'TaxTim' is here to help.
This is a subscription based, fully automated web application / chat-bot. The logic is developed by tax professionals. Personal data is kept in a secure server with no third-party access. The application helps you prepare your personal tax computations and completes your tax returns.
By answering simple questions that do not require any tax knowledge, Tim will convert your answers into a fully completed tax return, which you can then submit to the relevant Internal Revenue Services. The entire process can be completed within 20 minutes.
For states that offer online filing (like Lagos and Rivers), you would need to upload the pdf of the completed returns on to their platform. For states that have no online platform, you would need to print and submit at their offices.
The solution comes at an important time given the Covid-19 "stay at home order" as the deadline of 31st March for filing tax returns under section 44 of the Personal Income Tax Act (PITA) approaches.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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