Tax Considerations for the Fiscal Year End 2021

As the 2021 fiscal year draws to a close, here are some tax related considerations for your business, to ensure there are no tax risks/ tax leakages lingering into the new year or waiting to crystallise through tax audits or tax queries:

  1. How well has the business complied with the provisions of the Finance Act 2019, and 2020; Value Added Tax (Modification Order), 2020 and Value Added Tax (Modification Order), 2021? 
  2. Has your business complied with the associated changes in Personal Income Tax / Pay-As-You-Earn computations, Companies Income Tax computations, Value Added Tax, Withholding VAT, Withholding Tax, Capital gains Tax, Stamp Duty/ Electronic money transfer levy, Digital and physical transactions involving non-residents, Related party transfer pricing obligations, etc.
  3. How ready is the business for the Finance Bill 2021, which has passed 2nd reading at the Senate, also undergone Public Hearing at the Senate on 14 December 2021?
  4. Is your business into Petroleum Operations? Have you begun evaluating business restructuring options (if applicable) to align with the new industry framework, or options for conversion or otherwise into the new licensing regimes? Are you contracting with a business or businesses in the Petroleum Industry? Have you begun evaluating how the Petroleum companies’ restructuring and new Industry Regulatory Framework may impact subsisting contracts with your company?
  5. Has your business kept proper books of accounts (in English) – proper books of accounts should align with the applicable accounting standards, with all source documents and ledgers / transaction details in-tact and verifiable. Has the business made arrangement for year-end stock count (if the business is into commodity trading)?
  6. Is the business using a proper accounting or ERP software that is fully navigable and useable by all necessary users? Would the business consider system upgrade or change or need professional help in upgrading or changing accounting and/ or HR& payroll solution, in preparation for a brand-new fiscal year? 
  7. Does your business have tax audits or disputes pending resolution with the tax authorities?
  8. Has your business’ payroll been properly structured and reviewed in line with the changes in the Finance Act 2020? Have the applicable changes been understood by the HR / payroll staff and all the employees?
  9. Would the business consider a year-end tax health check or tax risk review (or pre-tax-audit review, if the business has a history of frequent/ yearly tax audits), to ensure that all tax records are in order and there are no tax leakages? Also recall that the FIRS has granted a window of waiver of interest and penalties, up to 31 December 2021 on all taxes and back taxes, of which your company can take advantage.
  10. How easy has it been for your team to navigate and use the Federal Inland Revenue Service (FIRS’) TaxPro-Max platform to file all taxes?
  11. Has the business considered other year end compliance obligations such as internal audit reviews, audit of the financial statements, budget reviews/ preparations for the new year, filing of PAYE employer and taxpayer returns, processing of tax clearance certificates for the company and its employees.
  12. Does the business have any permits or regulatory approvals pending with the regulatory authorities? If yes, have you reviewed the circumstances surrounding such applications and seen that the absolute best has been done?

If you need professional help with any of the above, please send an email to clients@vi-m.comor call/WhatsApp us on +234 8173203657.

Not sure what help you need, but just need to ensure your business is on the right track?  Do not worry, we will also assist you once you send us an email or call us, on and/ or +234 8173203657.