Thread by @ChideraDe

PRACTICAL GUIDE ON HOW BUSINESS OWNERS IN NIGERIA CAN OBTAIN TAX CLEARANCE CERTIFICATE WITH THE F.I.R.S - PART 3
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Conditions Under Which Tax Clearance Certificates May Be Issued By The FEDERAL INLAND REVENUE SERVICE.

This is practical. Not sharing theory....

In order to buttress my point, i’m going to share with us THREE case situations and the practical steps required to obtain company Tax Clearance Certificate under each scenario.

Undoubtedly, your situation should fall under one of these below if you are a company...

transacting business in Nigeria.

Carefully consider these steps and take them to heart.

The case scenarios under which TCC can be obtained includes:

1) New Tax Payer Status – Assuming you incorporated your business with the CAC in January 2019 and you commenced business

immediately in the same year.

2) Assuming you incorporated your business in 1995 or later but did not commence business immediately until let’s say, 2013.

3) Assuming you incorporated & commenced business some years back but you are just filing in returns in 2015....

CASE STUDY #1

New Tax Payer Status

Assuming You Incorporated Your Business In January 2019 & Then Commenced Operations Immediately – How Do You Obtain Tax Clearance Certificate Under This Situation ?

So many new tax payers fall under this category.

These are business owners..

who newly incorporated their businesses as a Limited Liability Company with the Corporate Affairs Commission

But before I go further, i’ll want you to be clear on a few important stuff:

i) That is, before you can start off processing anything with the F.I.R.S, you would...

initially have sent in a written application on your company letter head addressed to the Tax Controller of the F.I.R.S Office in your business jurisdiction signed off by the Managing Director of your company.

ii) A letter appointing a firm of Chartered Accountants as...

your Auditor & Tax Consultant and:

iii) A letter of acceptance from the firm accepting to function in that capacity will all be submitted to FIRS.

iv) You’ll attach a copy of your Certificate of Incorporation and Memorandum & Articles of Association to the application...

Upon submission, these documents will sighted & acknowledged by a member of staff of F.I.R.S vested with the responsibility to do so, thereafter, you will be registered as a “TAXPAYER” with the F.I.R.S.

Once this is perfected you will be told when to come for your TIN...

Know that you’ll also register for Value Added Tax by completing an application for VAT Registration and accompanying it with a Certificate of Incorporation, Memorandum & Articles of Association, Certified True Copy (CTC) of Form CAC 2 & CAC 7.

Once the above are taken care...

of you’re good to go.

If your organization commenced business transaction in 2019 then by default, you are not expected to pay Income & Education Tax just yet, but you will start filing in returns for VAT and this will be on a monthly basis...

You have a grace period of 18 months (1yr 6mths) after incorporation of your business to file in your annual returns.

What this means is that, assuming you started off in January 2019, then, you have up until June 2020 to file in your annual returns and then apply for TCC...

But then, if you want to obtain your TCC within the year, you’ll have to show verifiable evidence to the tax authorities that you are just commencing business operations and that you need the TCC for something.

Now, your Tax Consultant will formally apply for your TCC...

This will be done online as they do not encourage manual application anymore.

An online account would've been created for your company and through that platform you will perfect your application.

Once your application is received by FIRS, a mail will be sent informing you...

of the receipt of your application.

F.I.R.S will start off the processing of your Tax Clearance Certificate, though, it will take time, but your Tax consultant will be following up on it.

Once it is ready, a mail will be sent to you informing you to download your TCC online...

Thereafter, subsequent transactions and correspondences with respect to your tax dealings will be handled by that particular tax office.

Sidenote: A Tax Consultant who knows the dynamics should help you once you commence your business just so you don’t make costly mistakes...

I hope this helps.

Watch out for Part 4 of this series.

Chidera ANELE
0802 318 9838, 07057179585
[e-mail]
Accounting |Tax Solutions| ERP Consultant| Real Estate