Tax amnesties have become a tool for governments to encourage voluntary compliance, regularize outstanding tax matters, and boost revenue collection. The Nigeria Finance Act 2019 introduced tax amnesty provisions aimed at providing taxpayers with an opportunity to resolve their tax liabilities and contribute to a more robust and transparent tax system. In this article, we will delve into the key features of the tax amnesty provisions under the Finance Act 2019 and their implications for individuals and businesses in Nigeria.
1. Voluntary Assets and Income Declaration Scheme (VAIDS):
The Nigeria Finance Act 2019 builds upon the Voluntary Assets and Income Declaration Scheme (VAIDS), which was launched in 2017. VAIDS offered taxpayers a window of opportunity to regularize their tax affairs and declare undisclosed income and assets. The Finance Act extends certain aspects of VAIDS to provide taxpayers with another chance to rectify their tax obligations.
2. Tax Relief and Amnesty:
The tax amnesty provisions offer relief to taxpayers who choose to declare their previously undisclosed income and assets. Under the Finance Act 2019, taxpayers who voluntarily disclose their tax liabilities are granted immunity from prosecution for tax-related offenses and are exempt from paying penalties and interest on the declared tax liabilities.
3. Limited Time Window:
The tax amnesty provisions specify a limited time window during which taxpayers can take advantage of the amnesty benefits. This encourages taxpayers to come forward and declare their previously undisclosed income and assets within the prescribed period. After the amnesty window closes, taxpayers will be subject to regular tax assessments, penalties, and interest.
4. Eligibility and Scope:
The tax amnesty provisions apply to a wide range of tax liabilities, including income tax, value-added tax (VAT), withholding tax, and capital gains tax. Eligibility criteria and specific requirements for availing the tax amnesty benefits are outlined in the Finance Act 2019. Taxpayers must adhere to these guidelines to ensure their participation in the amnesty program.
5. Benefits for Taxpayers:
Participating in the tax amnesty program offers several benefits to taxpayers. It provides a means to resolve outstanding tax liabilities without the burden of penalties and interest charges. Additionally, taxpayers who avail the amnesty provisions contribute to a more transparent and equitable tax system, fostering a culture of voluntary compliance.
6. Professional Guidance and Compliance:
Navigating the tax amnesty provisions and ensuring compliance can be complex, especially for individuals and businesses with intricate financial affairs. Seeking professional guidance from accounting and tax experts is crucial to maximize the benefits of the tax amnesty program. Professionals can assist taxpayers in accurately calculating their liabilities, preparing required documentation, and ensuring compliance with all stipulated requirements.
The tax amnesty provisions introduced by the Nigeria Finance Act 2019 offer taxpayers an opportunity to rectify their tax affairs, regularize their previously undisclosed income and assets, and contribute to a more robust tax system. By taking advantage of the limited-time amnesty window, individuals and businesses can resolve their tax liabilities without facing penalties and interest charges.
By participating in the tax amnesty program, taxpayers can align with Nigeria’s efforts to enhance voluntary tax compliance, strengthen revenue generation, and support the nation’s economic growth and development. The tax amnesty provisions underscore the government’s commitment to creating a fair and transparent tax environment that benefits both taxpayers and the country as a whole.
For professional advice on Accountancy, Transfer Pricing, Tax, Assurance, Outsourcing, online accounting support, Company Registration, and CAC matters, please contact Sunmola David & CO (Chartered Accountants & Tax Practitioners) at Lagos, Ogun state Nigeria offices, www.sunmoladavid.com. You can also reach us via WhatsApp at +2348038460036.