The Federal Inland Revenue Service (FIRS) says it is set to embark on a nationwide value-added tax (VAT) and withholding tax (WHT) compliance monitoring exercise for all taxable persons from October 23.
In a statement on Monday, Zacch Adedeji, the FIRS chairman, said the move would enhance tax compliance and revenue collection in the country.
VAT is a consumption tax placed on a product whenever value is added at each stage of the supply chain — from production to the point of sale.
On the other hand, WHT is deducted at source by organisations or bodies making payments to suppliers of goods and services. They are required to remit the deducted sum to the tax authority as payments are being made to suppliers/vendors.
Advertisement
Adedeji said the monitoring exercise is in line with the FIRS Act of 2007 and will take effect from Monday, October 23, 2023.
“Pursuant to Sections 2, 8, 26 and 29 of the Federal Inland Revenue Service (Establishment) Act 2007 (as amended), notice is hereby given to all taxable persons or tax agents including Non-Governmental Organisations (NGOs), Ministries, Departments and Agencies (MDAs) of governments at the Federal, State and Local levels,” he said.
“The Federal Inland Revenue Service (FIRS) shall embark on a nationwide VAT and WHT Compliance monitoring exercise with effect from Monday, October 23, 2023.
Advertisement
“As a result, teams of officers from the Service shall visit selected taxpayers, taxable persons (including companies, NGOs or MDAs) to review their VAT and WHT records.
“The exercise shall cover 2019 to 2022 accounting years for taxable persons whose records have been audited by the Service up to 2018 accounting year.”
Adedeji explained that for taxpayers whose records have not been audited by the agency up to 2018, the exercise shall be extended to include the prior years that have not been audited.
“All taxable persons or tax agents who have made deductions of VAT or WHT on behalf of the Service are required to immediately remit all such deductions to the FIRS within two weeks of this publication,” he said.
Advertisement
The taxman said taxable persons or tax agents who shall be visited for the VAT and WHT compliance monitoring exercise will be notified by the FIRS and the documents required for the exercise will be listed in the letter to selected entities.
Add a comment
