Home Blog Page 20

Court stops FIRS from collecting VAT from Lagos hotels, restaurants

COLLECTING VAT

Court stops FIRS from collecting VAT from Lagos hotels, restaurants

A Federal High Court sitting in Lagos has granted an order of perpetual injunction to restrain the Federal Inland Revenue Service (FIRS) from collecting Value Added Tax (VAT) from customers for goods and services consumed in hotels, restaurants and Event Centres in Lagos State.

The court also declared the Lagos State Hotel Occupancy and Restaurant Consumption Tax Law and Regulation as constitutional, valid and operative.

“Lagos State is the only constitutional and lawful body permitted to assess, impose and collect tax from customers for goods and services consumed in hotels, restaurants and event centres in the state,” the court ruled.

The judgment was delivered in Suit No. FHC/L/CS/360/18 between the Registered Trustees of Hotel Owners and Managers Association vs. the Attorney General of Lagos State & Anor by Justice Rilwanu Aikawa on Thursday.

The judgment stated that since the Value Added Tax (VAT) by Federal Inland Revenue Service contains provisions relating to the consumption, it had ‘covered the field’ and as such, no State law can impose any similar tax.

The Court, therefore, invalidate sections 1, 2, 4, 5 and 12 of the Value Added Tax Act for being inconsistent with the provisions of the Constitution of the Federal Republic of Nigeria 1999 as amended.

The Registered Trustees of Hotel Owners and Managers had challenged the legality of the Lagos State Hotel Occupancy and Restaurant Consumption Tax Law and Regulation Law in 2018.

Call 0803 239 3958 to get free financial consulting advice for your businesses and start-ups.
Send your accounting articles to blog@skytrendconsulting.com.

READ ALSO! PAYE: How to calculate personal income tax

READ ALSO! Skytrend Consulting: Financial services and accounting solutions company

READ ALSO! For failing to give out ‘adequate loans’, 12 banks fined N499bn

READ ALSO! Nigerian Central Bank Approves Disbursement Of Loans For Creative Industries At 9%

READ ALSO! How To Empower Yourself And Generate Income From Mutual Funds

READ ALSO! Is N-Power Truly Empowering Nigerian Youths?

READ ALSO! TraderMoni: Poverty Alleviation Or Political Leverage?

PAYE: How to calculate personal income tax

PAYE
Calculating Pay As You Earn- PAYE in Nigeria

PAYE: How to calculate personal income tax in Nigeria

If you earn an income and you live in Nigeria, you are expected to pay tax on your earned income called PAYE.. Pay As You Earn every month.

The administration of personal income tax (PAYE) is managed by the State Inland Revenue Service, and this has to do with your state of residence.

If you live in Lagos State for instance, but work in Ogun State, you are expected to pay tax to Lagos State and not Ogun.

Nigerian Personal Income Tax Laws have evolved over the years with several amendments introduced to align with the income of Nigerians.

The latest amendment was in 2012 when the Goodluck Jonathan Administration signed into law an Amended Personal Income Tax Act, replacing several controversial sections of the act with a simpler and easy to calculate taxable income.

The new amendments affect several sections of the Personal Income Tax Act, particularly Section 33 which deals with Personal Relief and Relief for Children, dependants, etc. This has now being replaced with a Consolidated Relief Allowance (CRA) of N200,000 + 20% of gross income.

They have also reviewed the Minimum Tax upwards from 0.5% to 1% and the Tax Table has also been notably amended.

Let’s consider the example of a worker who earns N250,000 every month. That amounts to N3,000,000 per annum.

First Step

Let’s attempt to break down the N300,000 into basic, housing, transport and other allowances below:

Second Step

There are reliefs all tax payers are entitled to. The first one is the personal allowance which is 20% of earned income in addition to a fixed sum of N200,000. In our example of N3,000,000 annual earned income, this adds up to N800,000. Pension relief is 8% of total basic, housing and transport allowances. Whle NHF relief is 2.5% of basic allowance. Please note this relieves are only gotten if it is applicable in the organization in question.

Third Step

From the above calculations, total relief is N1,013,461.65 while taxable income is N1,986,538.35. The first N100,000 is taxed at 7%. The next 100,000 at 11%. The next 500,000 at 15% and the next 500,000 at 19% and the next 500,000 at 21%. The next 500,000 if any will be taxed ar 24%.

We can see from the above analysis that the worker will pay a monthly tax of N25,431.09.

READ ALSO! Skytrend Consulting: Financial services and accounting solutions company

READ ALSO! Why The North Remains Headquarters Of Poverty In Nigeria — Kingsley Moghalu

READ ALSO! For failing to give out ‘adequate loans’, 12 banks fined N499bn

READ ALSO! Nigerian Central Bank Approves Disbursement Of Loans For Creative Industries At 9%

READ ALSO! How To Empower Yourself And Generate Income From Mutual Funds

READ ALSO! Is N-Power Truly Empowering Nigerian Youths?

READ ALSO! TraderMoni: Poverty Alleviation Or Political Leverage?

For failing to give out ‘adequate loans’, 12 banks fined N499bn

12 BANKS FINED

For failing to give out ‘adequate loans’, 12 banks fined N499bn

The Central Bank of Nigeria (CBN) says 12 banks have been debited N499 billion for failing to give out 60% of their deposits as loans.

The cash reserve of the banks held by the CBN has been debited.

The CRR is a portion of the banks’ deposits kept with the CBN for regulatory reasons.

In July, the CBN had increased the loan to deposit ratio to 60% saying: “Failure to meet the above minimum LDR by the specified date shall result in a levy of additional Cash Reserve Requirement equal to 50% of the lending shortfall of the target LDR”.

The affected banks are:

Citibank – N100,743,055,321
First Bank of Nigeria – N74,668,880,480
FBNQuest Merchant Bank – N2,697,456,144
First City Monument Bank (FCMB) – N14,371,064,742
Guaranty Trust Bank – N25,147,933, 628
Jaiz Bank – N7,525,165,552
Keystone Bank – N4,162,938, 879
Rand Merchant Bank – N2,823,177,399
Standard Chartered Bank – N30,027,137,984
SunTrust Bank – N1,703,205,427
United Bank for Africa – N99,676,181,916
Zenith Bank – N135,629,337,625
On Tuesday, the CBN again raised the LDR to 65% and set a December deadline for banks.

The CBN said the newly revised LDR is informed by the noticeable growth in the level of the industry gross credit.

According to data provided by the CBN, the credit provided to businesses increased by N829.40 billion between the end of May and September 26.

The LDR policy is expected to encourage lending to small businesses and reduce banks’ appetite for investing in government securities like treasury bills.

Call us today on 0803 239 3958 for more information or inquiries. You can also send an email to us at info@skytrendconsulting.com; Send Accounting & Financial updates to us at info@skytrendconsulting.com.

READ ALSO! Senate Unveils Communication Service Tax

READ ALSO! TraderMoni: Poverty Alleviation Or Political Leverage?

READ ALSO! TraderMoni: Poverty Alleviation Or Political Leverage?

READ ALSO! Nigerian Central Bank Approves Disbursement Of Loans For Creative Industries At 9%

READ ALSO! Tony Elumelu To Empower 1,000 Northern Entrepreneurs With $5000 Each

READ ALSO! How To Empower Yourself And Generate Income From Mutual Funds

READ ALSO! How Nigerian Govt Can Lift 100million People Out Of Poverty — Tony Elumelu

Senate Unveils Communication Service Tax

Communication Service Tax

Senate Unveils Communication Service Tax

The Nigerian senate has unveiled a communication service tax on all telecom consumers nationwide.

A bill to enact a legislative action to impose a communication service tax was on Wednesday presented in Senate for first reading.

The bill, according to Businessday, is to replace the 2.5 percentage point increase in the Value Added Tax (VAT) being planned by the Federal government. Finance minister, Zainab Ahmed had announced the proposed VAT increase.

Tagged “Communication Service Tax Bill, 2019” it is being sponsored by former Senate Leader, Ali Ndume.

The Bill stipulates that Tax shall be levied on Electronic Communication Services like Voice Calls; SMS; MMS; Data usage both from Telecommunication Services Providers and Internet Service as well as Pay per View TV Stations.

Ndume, while fielding questions from journalists after the bill was presented for the first time, explained that it would enhance distribution of wealth where ordinary Nigerians would benefit.

According to Ndume, it is unhealthy to increase VAT because it will greatly affect the economy by astronomically jacking up prices of goods and services.

A copy of the Bill sighted by journalists reads thus:

“There shall be” imposed, charged payable and collected a monthly Communication Service Tax to be levied on charges payable by a user of an Electronic Communication Service other than private Electronic Communication Services.”

“The tax shall be levied on Electronic Communication Services supplied by Service Providers.”

“For the purpose of this clause, the supply of any form of recharges shall be considered as a charge for usage of Electronic Communication Service.”

“The tax shall be paid together with the Electronic Communication Service charge payable to the service provider by the consumer of the service.”

“The tax is due and payable on any supply of Electronic Communication Service within the time period specified under sub-clause (5) of whether or not the person making the supply is permitted or authorized provide Electronic Communication Services.”

“The Federal Inland Revenue Service (FIRS) established under section 1 of the Federal Inland Revenue Service (Establishment) Act, 2007 shall be responsible for collection and remittance of tax, any interest and penalty paid under this Bill.”

“The FIRS shall pay the tax collected together with any interest and penalty into the Federation Account.” it added

The bill further stated that all service providers shall file a tax return to account for the tax.

“The tax return shall be in a form prescribed by the FIRS and shall state the amount of tax payable for the period and any related matters that may be required.

The return and the tax due to the accounting period to which the tax return relates shall be submitted and paid to the FIRS not later than the last working day of the month immediately after the month to which the tax return and payment relates.”

READ ALSO! Nigerian Central Bank Approves Disbursement Of Loans For Creative Industries At 9%

READ ALSO! Skytrend Consulting: Financial services and accounting solutions company

READ ALSO! How To Empower Yourself And Generate Income From Mutual Funds

READ ALSO! Is N-Power Truly Empowering Nigerian Youths?

READ ALSO! How Nigerian Govt Can Lift 100million People Out Of Poverty — Tony Elumelu

READ ALSO! TraderMoni: Poverty Alleviation Or Political Leverage?

READ ALSO! Is N-Power Truly Empowering Nigerian Youths?

READ ALSO! Gtbank 737 Disservice: How to Kick Your Customers in the Butt!

READ ALSO! Why The North Remains Headquarters Of Poverty In Nigeria — Kingsley Moghalu

READ ALSO! The Love Of Your Life Is An Illusion: It Doesn’t Exist Anywhere!

Skytrend Consulting: Financial services and accounting solutions company

FINANCIAL SERVICES

Skytrend Consulting: Financial services and accounting solutions company

Welcome to Skytrend Consulting Ltd, a business development and accounting Solutions Company with head office at Lagos, Nigeria: 7 Obokun Close, Off Dipeolu Street, Allen Avenue, Ikeja. We offer a wide range of creative accounting and financial services to organizations geared towards planning and optimizing their cost, facilitating business growth and improving steady profitability with the use of tailored and well tested business strategy that identifies and build on the strength of our clients’ organisation.

Accounting Software Installation
Skytrend Consulting helps to install accounting software and solution for your business organizations whether product or service oriented. Our software solutions are easy to use, and quite simplified even with or without the basic accounting skills.

The software provides solution that helps organizations achieve more by simplifying everyday tasks so you can get more work done, helps you get to your data faster and provides tools to help increase organizational efficiency and financial recording accuracy.

It has features to get your business and finances more organized and more productive with its robust core accounting and customizable business management features that save you time and money.

More, once implemented, your labour intensive accounting task becomes automated, it accelerate tax preparation, and reduce the risk of human error in the workplace which eliminates critical bottlenecks such as inaccurate audit information.
Accounting Software Training. Our financial services include training programmes that build staff capacities in the following procedures:

1. Evaluation and strengthening of existing system of internal control if existent and creating a new one if non-existent; blocking all financial and stock wastages and pilfering.

2. Implementation of appropriate accounting solution to your business financial systems.

3. Entire setting up of a proper accounting system that includes charts of accounts appropriate for the organization, maintenance and updating of customers and vendors records, and setting up of a proper inventory recording and management systems.

4. Capacity building sessions for staff on appropriately and effectively using the newly installed accounting software to back up and restore company’s file, maintaining new customers and vendors and daily update of financial records and day to day usage of the solution.

If you invest time and money on training up, employees will be better equipped to handle their daily financial responsibilities. This will also make it easier for employees to train new hires on the system, and to assist one another with software questions and issues.

We will work with you to evaluate existing internal processes and explore how they can be enhanced or improved upon with the help of our software solution.

Accounting Systems Set Up and Implementation
Our accounting systems set up and implementation services include instituting a proper accounting system for your business, deploying a custom made accounting solution to all your service products and financial records.

This will in turn deliver the efficiency your organization requires whether you’re after rapid expansion, steady growth, or maintaining stability. Our set up and implementation effort allow you to easily manage customers, vendors, manage inventories, track income and payment, track your store and stock items, automate purchasing and supplies, track jobs, and properly maintain inventory and equally track their usage!

In effects, our implementation will achieve the following objectives:

1. Help to manage the company’s payments, collections, receivables, cash and bank balances by the use of the automated solution.
2. Gain insight with custom reporting for budgeting, cash flow management, and benchmarking.
3. Get a high-level view of your key metrics.
4. Track stock inventory movement and balances, plan purchases, or expand service offerings.
5. Reduce errors and deter fraud with screen-level security and a clear audit trail
6. Work more efficiently with customer, vendor, and inventory management centers
7. Save cash and reduce costs using “what if” scenarios and your real-time financial information.
8. Periodically produce income and expenditure reports for the business and analyse financial trend at a glance.

Financial Consultancy and Retainership
We provide retainership services for clients who prefer a long-range predictable financial solution and engagement. This makes it possible to meet clients call on demand depending on the terms of the retainership.
This allows us to meet personally with clients to assess their financial situation in order to present a financial plan that includes both short- and long-term financial goals. We thus help clients with financial planning decisions that will enhance and facilitate short, medium and long term financial goals.

Accounting Staff Outsourcing & HR Services
We provide outsourcing services for our clients. We can manage your entire accounting department and help you have a broad overview of what the figures are saying and their implication for your business growth.
We also hire staff for our clients. We have a robust database of qualified and professionally certified accountants in different areas across the country that can meet the demands of our clients at the nick of time.

Financial and Business Reviews
It is important to review the financial performance of the business on a regular basis.
We help identify how you can make the most of the market position you’ve established and decide where to take your business next. We revisit and update your business plan with your new strategy in mind and make sure you introduce new business opportunities and developments.
We also:
• Assess your core activities
• Assess your business efficiency
• Review your financial position
• Conduct a competitor analysis
• Conduct a customer and market analysis
• Use your review to redefine your business goals
• Models for your strategic analysis
• Break down your strategic review

Call us today on 0803 239 3958 for more information or inquiries. You can also send an email to us at info@skytrendconsulting.com; Send Accounting & Financial updates to us at info@skytrendconsulting.com.

READ ALSO! How To Empower Yourself And Generate Income From Mutual Funds

READ ALSO! Is N-Power Truly Empowering Nigerian Youths?

READ ALSO! How Nigerian Govt Can Lift 100million People Out Of Poverty — Tony Elumelu

READ ALSO! TraderMoni: Poverty Alleviation Or Political Leverage?