To file income tax in Nigeria has been made very easy by the government and for the same reason it is also to be noted that in the recent years the economy has seen an increase in the income tax earnings of the government. Formerly the file income tax laws were not strict and the entities were taking advantage to avoid tax in this regard. To file income tax there are several precautions that the entities need to practice to make sure that the tax is filed in line with the requirements of the government of Nigeria. To make the process easier for the tax payers the government has also directed several national as well as private banks to make sure that the entities that come to file income tax are treated in the best possible manner. To understand the file income tax idea following are some of the most important entities that are to be considered in this regard:
- Company Tax
Each and every company beside gas and petroleum sector needs to make sure that the tax return is filed within the proper time that has been designated by the government each year. Companies need to make sure that 30% of total profit is paid to the government in terms of taxation and it is also to be noted that every company is also liable to pay 2% assessable tax to the government which is termed as educational tax. The fiscal year in Nigeria is from 1st January to 31st December but the company can file the tax when its own accounting year ends. The period shall not exceed 6 months from the end date of the accounting year.
- Petroleum sector
The petroleum sector needs to make sure that the 30% of total income is paid as tax when it comes to downstream operations. It is also to be noted that the petroleum sector needs to make sure that to file income tax returns the US dollars are used as currency. The company filing the petroleum tax needs to ensure that the return in filed within 2 months according to the accounting year the company follows. It is also to be noted that the tax of these companies is payable in 12 monthly installments if they are not in a position to pay the tax immediately.
- Capital gains tax
Capital gains arising from the asset disposal are taxed at the rate of 10%. The capital gain tax is also never charged if the asset is disposed off and the new one of similar genre is purchased instead. The value of the new asset is then determined and the tax is charged accordingly to make sure that the government records remain up to the mark. Capital losses are also not charged against normal trading income. In most of the cases it is also to be noted that to charge the capital gain tax inflation is never recommended.
There are many agencies and income tax filing companies that are working within the Nigerian economy to make sure that the process of filing the tax is easy and simple. To get the best within the timelines set by the government the individuals as well as companies should know the process that is to be followed when they file income tax. The individuals as well as the companies make sure that the idea of file income tax is implemented as soon as the government declares the deadline for filing the income tax and it is all due to the fact that the late submissions are penalized by the government and the person also gets into hassle of filing the tax in hurry which makes the return wrong most of the time. Before the file income tax idea is worked upon the user also needs to know the business or the job they are working on so that the deductions are enjoyed. The tax payer needs to gather all the necessary information in this regard so that the related tax clauses become clear and the user can also follow them in a perfect manner. The user also needs to change the tax information or the direct deposit information if the need arises and it should be done before implementing the file income tax idea.
Gone are the days when the file income tax idea was implemented with the help of paper and pen so as a next step the user needs to make sure that the proper income tax return filing software is installed onto the machine so that the idea of file income tax becomes even easier. It is the most important step in relation to the income tax filing and the user should make sure that the best software is installed in this regard so that the process never becomes complex and the user also gets the best results. These software programs are specifically designed to make sure that the user never faces the hassle of late submissions and the time is also saved while filing the income tax returns.
These software programs also make sure that the best is provided to the user in terms of safety and security of the data and the personal information and if the user decides to file income tax online then this software program helps them out in this regard by providing maximum safety and security. Most of the software development companies in this regard have embedded SSL certificates that take care of the environment while the data is being transferred to the income tax department server. The unauthorized access has not only been limited but the companies are also making sure that the idea becomes even enchanting as the more security features are being added to the existing software programs working in this regard.
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