The new Circular on the tax implications of the adoption of IFRS recently released by the FIRS has been amended. Apart from the inclusion of a publication date, the major change is in paragraph 13.1 regarding the effects of changes in foreign exchange rates. The paragraph which initially reads:
“Income tax assessment shall be made in Nigerian Currency (Naira) subject to the exceptions provided in the tax laws.”
has been amended to read:
“The presentation currency for the purposes of tax returns shall be the Nigerian Currency (Naira) except as otherwise provided in the tax laws. The currency for tax assessment shall be in line with the provisions of the relevant tax laws. ”.
I understand from the FIRS that the change is to ensure consistency with the Revenue’s intention to assess taxes (including income tax) in the currency of transaction rather than Naira as is currently the case.
A Bill, the Pension Reform Bill 2013, to repeal the Pension Reform Act 2004 (as amended) and enact the Pension Reform Act 2013 is undergoing legislative process at the National Assembly. Some of the fundamental changes proposed in the Bill include:
The scheme will be applicable to employers with 3 or more employees (currently 5 or more);
The total rate of contribution is 20% (currently 15%) of monthly emolument with a minimum of 12% (currently 7.5%) by the employer and a minimum of 8% by the employee (currently 7.5%); and
Basis of monthly contribution to be total emoluments as may be defined in the employee’s contract of employment but shall not be less than a total sum of basic salary, housing allowance and transport allowance (currently, monthly emolument means a total sum of basic salary, housing allowance and transport allowance).
All companies with December financial year-end date are required to file their companies income tax returns this month. This is in addition to the usual monthly compliance requirements for various taxes such as PAYE, VAT and WHT.
Please find below PwC's tax calendar to assist you in this regard.