Thread by @andyRoidO

Allow me. Let me start by saying that the rule the Government handles were quoting, doesn't (or shouldn't) apply to everybody. If you're not a resident of another country, it doesn't apply to you. Now let me explain.

https://twitter.com/Chydee/status/1306886293062852609

So Nigeria signed up to an international agreement, arranged by the OECD. The goal of the agreement is to make sure that Country A is aware of any of its residents who are making money in other countries. This info is needed for proper taxation. @Chydee

The problem was, before now, there was no way for Country A to know if Resident R was doing business in country B. Meanwhile, Resident R may be gaming the system in Country B, paying reduced tax by claiming to be a Resident of Country A.

So OECD got over 100 countries to sign an agreement. From now on, each country agrees to keep track of anybody doing business in their borders, who is a resident of any of the other countries. And then, all the countries share the info with each other.

But how do the Governments get the info? Well, they use the banks and other financial institutions. Whenever anyone opens an account, they're supposed to provide KYC information that includes information like citizenship. Based on that, the banks should have a fair idea of...

... a fair idea of who and who COULD be a resident of another country. The bank is then meant to give those people an extra form, called a "Self-Certification Form", that gives all the information that their REAL country of residence would need.

The Bank then shares all the info from all those foreign residents with the Govt (FIRS), and the Govt uploads them to the OECD platform, using the so-called "Common Reporting Standard" (CRS).

So what was yesterday's malarkey about?

Well, FIRS is now riding the banks and foreign residents to comply and submit all the data from 2019, that should have been sent on or before May of this year. This should NOT have been a general announcement.

This is where the miscommunication started. The title CORRECTLY specifies that the forms are to be filled by "REPORTABLE persons". Reportable persons are defined in the FIRS regs as people resident in another country etc.

BUT the BODY of the memo says ALL account holders.

The Income Tax (Common Reporting Standard) Regulations don't lay out account closure as a penalty.

In fact, the regs put the onus on the FINANCIAL INSTITUTION, not the general public.

The rules want the banks to do the work of checking their records to see who could be a foreign resident, and then contacting those few people to give them more info.

The FIRS memo on the other hand pushes this hard work to ALL NIGERIANS, to go to their bank and fill a form.

To me, this is just another one of those very common situations where a Nigerian Govt agency chooses to inconvenience the public for the incompetence of institutions (in this case, the banks), and uses non-existent powers to do it.

I should point out that the Income Tax (Common Reporting Standard) Regulations (2019) clearly state that new KYC forms are applicable to accounts opened AFTER the regulation. For older accounts, the banks have to look through their records, and figure it out.

But if FIRS is deciding that no, it wants all of us to update our KYC information with this new "Self-Certification", we must ask them first to create regulations that say so.

Also, I must point out CBN controls banking, not FIRS, so from where comes the power to close accounts?