Company income Tax Tax Rate: Payment of Minimum Tax:

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1 Company income Tax Is a Tax imposed by the Government on the income and profits of companies operating in the country. The law governing the administration of Companies Income Tax is the Companies Income Tax Act. The law which was first enacted in 1961 has undergone so many amendments, the latest being that of April, The administration of the Companies Income Tax is vested on the Federal Inland Revenue Service which used to be known as the Federal Board of Inland Revenue (FBIR) until the enactment of the Federal Inland Revenue Establishment Act in April, 2007 which scrapped the FBIR and replaced it with Federal Inland Revenue Service. Tax Rate: The current Tax rate in any year of assessment for a company in Nigeria is 30%. The tax is payable on the profits accruing in, derived from, brought into or received in Nigeria. These profits are in relation to the following activities: Any trade or business carried out Rent or any premium arising from a right granted any person for the use or occupation of any property. Dividends, interest, discounts, royalties, charges or annuities. Any source of annual profits not falling under any of the fore-goings. Fees, dues, and allowances for services rendered. Any amount of profits or gains arising from acquiring or disposing shortterm money instruments like the federal government securities, Treasury Bills and Savings Certificates, Debenture Certificates and Treasury Bonds. Any amount deemed to be income or profit with respect to any benefit arising from a pension or provident fund under the Personal Income Tax Act. Payment of Minimum Tax: Where in any year of assessment the ascertainment of total assessable profit from all sources of a company results in a loss, or where a company s ascertained total profits result in no tax payable or tax payable which is less than the minimum tax, there shall be levied and paid by the company a minimum tax as prescribed by subsection (2) of section 33 of CITA. The minimum tax to be levied and paid are as follows: 1. If the turnover of the company is N500,000 or below and the company has been in business for at least four calendar years, the minimum tax shall be: 0.5% of gross profit; or 0.5% of net assets; or 0.25% of paid-up capital; or

2 0.25% of turnover of the company for the year. 2. If the turnover is higher than N500,000, be whatever is payable as per any of the above, plus such additional tax on the amount by which the turnover is in excess of N500,000 at a rate which shall be 50% of the rate used above of 0.25%. Date of Filing Returns and penalty for late filing: The date of filing returns for companies shall be: In the case of a company that has been in business for more than 18 months, not more than 6 months after the end of the accounting year. In the case of a newly incorporated company within 18 months from the date of its incorporation or not later than 6 months after the end of its accounting period, whichever is earlier. In addition, the form of returns shall be signed by a Director who must be the Chairman or the Managing Director of the company and the Secretary respectively. Any company which fails to comply with the provisions listed above shall be liable to pay as penalty for late filing as stated below: N25,000 in the first month in which the failure occurs; and N5,000 for each subsequent month in which the failure continues. Petroleum Profits Tax Act (PPTA) The Principal Act governing the taxation of profits from petroleum operations in Nigeria is the Petroleum Profits Tax Act Petroleum Operations Section 2 of PPTA defines petroleum operations as the winning or obtaining and transportation of petroleum chargeable oil in Nigeria by or on behalf of a company for its own account by any drilling, mining, extracting or other like operations or process, not including refining at a refinery, in the course of a business carried on by the company engaged in

3 such operations, and all operations incidental thereto and any sale of or any disposal of chargeable oil by or on behalf of the company. The main activities involved in petroleum operations From the foregoing definition, these activities are: 1. Exploration 2. Appraisal 3. Drilling/Mining 4. Extraction 5. Transportation by Pipelines 6. Sale of chargeable oil 7. All other operations incidental to any of the above Another name for Petroleum Operations is Upstream Operations Major companies in Petroleum Operations in Nigeria 1. Chevron Nigeria Limited 2. Shall Petroleum Development Company Limited (SPDC) 3. Shell Nigeria Exploration and Production Company Limited (SNEPCO) 4. Nigeria Agip Oil Company (NAOC) 5. Elf Petroleum Nigeria Limited EPNL) 6. Mobil Producing Nigeria Limited (MPN) 7. Addax Petroleum Exploration Limited 8. Consolidated Oil Nigeria Limited 9. Moni-Pulo Limited 10. Famfa Oil Limited. Petroleum Activities are not covered under Petroleum Operations These operations, which are also known as downstream operations, include: 1

4 1. Petroleum Products Marketing 2. Crude oil refining 3. Gas refining and distribution 4. Crude oil transportation by ocean going vessels Examples of companies in Downstream Operations 1. Total 2. Conoil 3. Nigeria Liquefied Natural Gas Limited (NLNG) 4. Nigeria Gas Company 5. PortHarcourt Refineries Company Downstream Operations: Applicable Tax Regime Downstream operations are not taxable under PPTA. They are taxable under CITA. 2 PPT Returns The two types of PPT Returns and when they must be filed Oil producing companies file 2 types of returns under PPTA in following an accounting period; these are: a. Estimated PPT returns; this must be filed not later than 28/29 February in an accounting year (Section 33) b. Annual PPT returns; This must be file not later than 31 st May in the following accounting year (Section 30) What is an accounting period under PPTA? (Section 2) 1. A normal accounting period runs from January - December 2. For a new company it is a period beginning from the day the company makes the first sale to 31 December of the year of commencement. 3. For a company which ceases business it is from 1 st January to the day the company ceases business in the year of cessation. When PPT is Payable 1. In respect of Estimated Returns PPT for any accounting period is payable in 12 equal installments commencing from March of that accounting period and ending in February of the following accounting period.

5 2. For the annual returns, the PPT payable is the PPT computed less estimates already paid; this is called 13 th or final installment and is payable not later than July of the following accounting period. 3. The Penalty for late payment of PPT than Late payment of PPT attracts penalty of 5% payable with the PPT due not later one month after the receipt of Demand Note. 3 PPT Computations under PPTA Chargeable Income (Sections 9 & 23) & other Incidental Income Deduct Section 10 Deductions: & adjust for Transport (shipping) Sec. 14 Royalty on exported crude Admin & Prod Exp Intangible Drilling Exp Exploration Costs and Expenditure on first two appraisal wells Adjusted Profits Losses recouped (Section 16) Assessable Profit Capital Allowances (Section 20) and PIA Chargeable Profits Assessable Tax (Chargeable Profit & Tax Rate) Income chargeable under PPTA (Section 9) This includes: a. Fiscal value of chargeable oil b. All incidental income, except income from oil shipping activities, wet cargoes (section 12) Note that natural gas is no longer taxable under PPTA since 1998, by the grace of the provisions of section 10A (2) of PPTA; is now taxable under CITA.

6 Examples of Incidental Income 1. Rental Income 2. Interest Income 4 How the Fiscal Value of Chargeable oil is determined By the provisions of sections 9 and 23 of PPTA, the fiscal value of chargeable oil for the purpose of PPT computations is the higher of. a. Volume of oil lifted multiplied by actual sales price and b. Volume of oil lifted multiplied by posted price (realizable price0 Posted price and realizable price are derived official prices of chargeable oil. They help to prevent under-pricing of chargeable oil by oil companies. What Adjusted Profits is under PPTA Adjusted Profits as defined in section 9 is the fiscal value of chargeable oil less deductions under section 10 and after adjustment under section 14. Deductions under section 10 include: a. Operating expenses such as royalty paid, admin & production expenses. b. Some capital expenditure like intangible drilling expenses, exploration expenses and expenses for the appraisal of the first two wells. From the above, we can see that some capital expenses are allowable under PPTA unlike in CITA. Adjustment under section14 is the exclusion of income from transportation of chargeable oil by ocean going oil tankers from taxable income under PPTA; such income is taxable under section 14 of CITA. 5

7 Deductions not allowed under PPTA i. expenses not being wholly, exclusively and necessarily expensed for the purpose of the operations; ii. iii. iv. any sum employed as capitals except as allowed under section10. any amount employed as improvements as distinct from repairs; sum recoverable under an insurance or contract of indemnity; v. rent of or cost of repairs to any premises not incurred for the purpose of the operations; vi. amounts incurred in respect of any income tax, profit tax or other similar tax within Nigeria or elsewhere; vii. depreciation of any premises, building, structures, works or a permanent nature, plant, machinery or fixtures; viii. payment to any provident, pension, saving, or other society scheme or funds not approved by the Joint Tax Board; ix. any expenditure for the purchase of information relating to the existence and extent of petroleum deposits; x. Interest on borrowed money where such money was borrowed to a second company, if during that period; - either company has an interest in the other company or - both have interest in another company either directly or - through other companies or - both are subsidiaries of another company. 6 Assessable Profits Assessable Profits is defined in section 9 (4) as adjusted profits less deductions allowed by section 16, which are losses brought forward (if

8 any). Therefore, under PPTA losses are deducted in arriving at assessable profits unlike in CITA. Chargeable Profits Chargeable Profits is defined in section 9 (5) as assessable profits less deductions allowed under section 20, which are annual allowances and petroleum investment allowances (PIA). Capital Allowance Rates under PPTA By the provisions of paragraph 5 and Table 1 of 2 nd Schedule of PPTA Annual allowances are claimed on qualifying capital expenditure at the rate of 20% p.a for four years and 19% in the fifth year. PIA rates under PPTA By the provisions of paragraph 4 and Table II of 2 nd Schedule of PPTA PIA rates applicable are: a. Onshore Operations 5% b. Operations in Territorial Waters and continental shelf area up to and including 100m of water depth.. 10% c. Operations in Territorial Waters and continental shelf are between 100m and 200 m of water depth. 15% d. Operations in Territorial waters and continental shelf area beyond 200m of water depth. 20% Assessable Tax The tax rate is applied to the chargeable profits to get assessable tax. The rates specified in section 21 are. i. For the first five accounting periods of a new company the rate is 65.75%. 7 ii. For other accounting periods the rate is 85% Main business/fiscal arrangements available under the upstream operations The three Main business and fiscal arrangements are: 1. Joint Venture Contracts (JVC) 2. Production Sharing Contracts 3. Sole risks (independent operators)

9 4. Farm-in and Farm-out 5. Alternative Funding. Main features of Joint Venture Contracts a. It is a contract between NNPC and one or more International oil companies. b. The members are Joint concessionaires of the oil blocks c. The contract is governed by a Joint Operating Agreement (JOA) d. One international oil company is appointed the operator of the JVC Projects are funded through cash calls e. Cash call are payable on the basis of equity participation. f. Crude oil produced is also lifted by each partner on the basis of equity participation g. JVC companies used to enjoy special tax incentives packaged under an agreement termed Memorandum of Understanding (MOU). MOU was suspended by FG in early The existing JVCs in the country. S/N Operator Members Equity (%) 1 Shell (SPDC) 1. NNPC 2. SPDC 3. Elf 4. NAOC 2 Mobil NNPC Mobil 3 Chevron NNPC Chevron 4 NAOC NNPC NAOC ConocoPhilips 5 Elf NNPC Elf Features of Production sharing contracts i. It is a contract between NNPC and one or more contractor ii. iii. iv. NNPC is the sole license holder unlike under PSC. The contractor bears all the risks of operations. The application of PPTA is moderated by the provisions of the Deep Offshore and Inland Basin Act and PSC Agreements. v. Areas of operation are deep offshore and inland basins. vi. PPT rate is 50% Features of PSC Continues 60 40

10 i. Contract areas i.r.o. of contracts signed before 1999 are entitled to investment tax credit at 50% on investments made. ii. But for contracts signed from 1999 what is applicable is petroleum investment allowance at 50%. iii. Crude oil produced is allocated in this order. Royalty oil to NNPC Cost oil to contractor Tax oil to FIRS, Abuja Profit oil to NNPC and contractor The major PSC fields in the country. S/N Main Contractor Field 1 SNEPCO Bonga 2 NAE Abo 3 Mobil Era 4 Chevron Agbami 5 Adax Okwori Features of Sole Risk (Independent Operators) The license holder(s) also take all the risks. NNPC has no stake except that of regulation and supervision. They are all indigeneous companies like Conoil, Moni-Pulo, Atlas and Amni. No special tax incentives outside PPTA. 9 Farm-in and Farm-out in Petroleum Operations Farm-out is a situation where an oil block license owner releases part of his interest but retains the operatorship. The owner is termed Farmee while the new entrant is Farmor. Farm-in is an arrangement in which a new investor takes over part of the interest in an oil block; ownership still resides with license holder. Explain Alternative Funding Arrangement in Petroleum Operations. This is an arrangement in which the international oil companies in JVC agrees to fund all the capital costs of a project; that is no cash call is made upon NNPC for its own equity participation. NNPC pays back its share of the capital costs through allocation of additional crude oil produced.

11 NNPC in this arrangement is termed the carried partner while the IOC is called the carrying partner Capital Gains Tax This is a tax chargeable at the rate of 10% on capital gains arising from the disposal of capital assets. Capital gains mainly represent the excess of disposal proceeds realized over the cost of the particular asset. The effects of some of the provisions of the Capital Gains Tax Act 1967 are as listed below: Capital loss on disposal of any asset is not deductable from capital gains on disposal of any other asset even if both are of the same type. Chargeable gains are assessed on current year basis. In other words, the assessment is based on the year the asset is disposed. Roll-over relief is available to any company acquiring a new asset to be used for the purposes of the trade in replacement of an old one. This is of particular interest to companies as there could be benefit accruing to those that would want to claim the relief. When the consideration is payable by instalments over a period exceeding 18 months, the chargeable gain shall be apportioned to the affected assessment years in proportion to the amount of the instalments payable in each of the years. The production of evidence of payment of applicable capital gains tax is a condition for effecting change of ownership of property. Currently, gains arising from disposal of shares and stocks are exempted from capital gains tax. Value Added Tax Value Added Tax (VAT) is a tax on spending. The tax is borne by the final consumer of goods and services and it is invoice based. The VAT element is to be separately indicated in the tax invoice. The tax presently is at a flat rate of 5%.

12 The tax is collected on behalf of the Government by businesses and organizations which have registered with the FIRS s Integrated Tax Office for VAT purposes nearest to them or their operating bases. Branches of such businesses and organizations are to register independently in their own areas of operation and they are classified as registered persons. A consumer will pay 5% on goods and services purchased but, can claim credit for input tax when sold. VAT returns and payments are normally made monthly to the Integrated Tax Office where registered on or before 30th day of the month following that in which the supply was made through proper keeping of records and accounts of all business transactions. No individual, business, organization or government agency is exempted from the tax. Only goods and services and specifically specified activities are exempted. Personal Income Tax What is PIT? PIT is Personal Income Tax. It is a tax that is imposed on individuals who are either in employment or are running their own small businesses under a business name or partnership. Though collection of PIT is a federal responsibility this tax is generally collected by state governments from those that are resident in their various states, regardless of whether they are federal, state, local government, or private sector workers. The Federal Inland Revenue Service, however, also collects this tax but only from residents of the Federal Capital Territory as well as what may be described as highly mobile federal workers staff of the Ministry of Foreign Affairs and other Nigerians and foreigners outside the country but earning income in Nigeria (non-residents), expatriate workers resident in Nigeria, Police Officers, and Military Officers. Civilians working in Police and Military formations, however, pay to their respective States of residence. The current law guiding the taxation of personal incomes is the Personal Income Tax Act (Cap P8 LFN 2004). Under the law, Federal and States tax boards are empowered to identify persons living in or earning income from Nigeria who are required to pay tax, and to assess incomes and tax their incomes using specified guidelines and rules. This law also guides the tax official in identifying the residence of potential taxpayers, as well as the sources and origins of their incomes for the purpose of taxing the income. Two forms of PIT

13 Two forms of taxes are administered under Act, namely (a) Pay-As-You-Earn (PAYE) i.e. taxes from employment, and ( b) taxes from self employed persons. Who Collects Personal Income Tax? Every individual who earns income in Nigeria either from employment or from doing a business is subject to tax under the PIT Act. (a) State Boards of Internal Revenue collect taxes of individuals in their various states of residence Body of individuals such as communities, families that run a business Business names and partnerships; Executors of estates of deceased persons and trustees of trusts. (b) Federal Inland Revenue Service also collects Personal Income Taxes of Persons employed in the Nigerian Army, the Nigerian Navy, the Nigerian Air Force and the Nigerian Police other than in a civilian capacity; Officers of the Nigerian Foreign Service; Non-residents who derive income or profit from Nigeria. Who is exempted from this Tax? The law exempts the following incomes from tax: Official emoluments of the President, Vice President, State Governors and Deputy Governors; Income of any Trade Union registered under the Trade Union Act, provided such income is not derived from a trade or business carried on by such Trade Union; Income of any Statutory or registered Friendly Society in so far as such income is not derived from a trade or business carried on by such Society; and Income and profits of Cooperative Societies. Which parts of a person s income are subjected to Tax? Tax is calculated for each year of assessment on the aggregate amounts of the income of every taxable person, for the year. The following incomes are subject to tax under the law: a. Gains or profits from any trade, business, profession or vocation for whatever period of time it may have been carried on by the taxable person; b. Dividends, interests or discounts c. Any pension, charge or annuity d. The gains or profits including any premiums arising from a right granted to any other person for the use or occupation of any property

14 What expenses can I deduct before paying personal income tax? In calculating income tax, the law allows deduction of all expenses and outgoings from emoluments of the fiscal year in which they are incurred, on the condition that they are: incurred in the production of income i.e. the performance of duties and wholly, exclusively, necessarily and reasonably so incurred Which are the Allowed & Disallowed Expenses? The law allows certain expenses but disallows others. Expenses specifically allowed under the law in calculating income tax include: Interest paid on borrowed money employed as capital in acquiring the income; Rent and premiums in respect of land and buildings occupied for the purposes of acquiring profits; Expenditure on repairs of premises, plant, machinery and fixtures and for the renewal, repair or alteration of such items used in acquiring income; Bad and doubtful debts, any recoveries being treated as income when received; A list of disallowed trading expenses include: - Domestic or private expenses; Capital withdrawn from a trade, business, profession or vocation and any expenditure of a capital nature; Any loss or expense recoverable under an insurance or contract of indemnity Taxes on income or profits levied in Nigeria or elsewhere except as provided in s.13 of the PITD. The depreciation of any asset. What Reliefs & Allowances are available under PIT? With effect from 1 January 1999, the following reliefs and allowances were incorporated in the law. Tax Free Earned Income: Annual income of N 30,000 and below is exempted from tax, although a minimum tax of 0.5% will be charged. Tax Free Allowances: The following allowances which have been granted under the recent salary reviews will be tax exempt subject to the following limitations: Allowable Allowances Upper limit of Tax Exemption (N) i. Rent subsidy/allowance N150,000 Per annum ii. Transport Allowance N15,000 Per annum iii. Meal subsidy/allowance N5,000 Per annum iv. Utility Allowance N10,000 Per annum v. Entertainment Allowance N6,000 Per annum vi. Leave Grant 10% of annual basic salary Personal Income Tax Rate Structure as at 1st January 1998

15 Taxable Income (N) Rate (% ) First 30, 5 Next 30, 10 Next 50, 15 Next 50, 20 Over 160, 25 How to pay PIT The law requires a taxable person to file the returns of income or a declaration of his annual income/remuneration for the current year with the relevant Tax Authority where he is resident. For each year of assessment, you are required to file a return of income in the prescribed form and containing necessary information, with the relevant Tax authority where the taxable person is deemed to be resident. This return is to be accompanied by a true and correct statement in writing containing: a) the amount of income from every source during the year preceding the year of assessment, b) such particulars as may be required for the purpose of the Act with respect to any such income, allowances, reliefs, deductions etc. c) a declaration by him or on his behalf that the return contains a true and correct statement of the income disclosed on the form, in accordance with the provisions of the Act. Where to Pay PIT (FIRS jurisdiction only) The FIRS has jurisdiction over the taxation of all individuals in employment including self-employed persons and enterprises resident in FCT Abuja. Accordingly, all taxable persons, self employed/enterprises in the FCT are obliged to file annual PIT/PAYE returns with the FIRS at any of the following Integrated tax offices located within Abuja FCT based on the approved areas of coverage: S/N Offices Assigned to Collect PTI/PAYE Functional Coverage 1. Large Tax Office NACB Building, Airport Road, Central District, Abuja. PIT/PAYE remittance from all Ministries, Departments and Agencies within Abuja. PIT/PAYE remittance from senior officers of the Armed Forces resident in FCT, Abuja. PIT/PAYE remittance from staff of the Nigerian Police in Abuja, including FCT Command. PIT/PAYE remittance from officials of Foreign Affairs resident in Abuja. PIT/PAYE remittance from employees (local and expatriate) of Companies with annual turnover figure of N1.0 billion and above. PIT/PAYE remittance from non-residents earning income from FCT, Abuja. 2. Garki ITO City Plaza, Ahmadu Bello Way, By Old CBN, Garki Abuja. PIT/PAYE remittance from employees of Companies with annual turnover below N1.0 billion.

16 PIT/PAYE remittance from individuals/self-employed persons resident within Garki and environment. Tax coverage areas include Asokoro, Nyanya, Karu, Jikwoyi, Garki Area 1-11, Garki II, Apo and Durumi. 3. Wuse ITO Plot 48, Sudan Street, Zone 6, Wuse Abuja. PIT/PAYE remittance from employees of Companies with annual turnover below N1.0 billion. PIT/PAYE remittance from individual/self-employed persons resident within Wuse and environment. Tax coverage areas include Wuse Zones 1 7, Wuse II, Mabushi, Life Camp, Utako, Jabi, Kado, Gwagwa, Idu-Karimu and Dei-dei. 4. Central ITO Owena House, Central Business District, Abuja PIT/PAYE remittance from employees of companies with annual turnover below N1.0 billion. PIT/PAYE remittance from individuals/self-employed persons. Tax coverage areas include Central Business District, Airport Road, Lugbe, Dutse, Maitama, Bwari, Kubwa and Gwarimpa. 5. Gwagwalada ITO FCT Secretariat, Gwagwalada. PIT/PAYE remittance from employees of companies with annual turnover below N1.0 billion. PIT/PAYE remittance from individuals/self-employed persons Tax coverage include Gwagwalada, Abaji, Kwali and Kuje. Other FIRS offices outside Abuja with responsibility for PIT/PAYE administration, S/N Offices Assigned to Collect PTI/PAYE Functional Coverage 1. Lagos Region LTO (Non-oil) 214, Broad Street, Elephant Building, Lagos. PIT/PAYE remittance from the Army, Air force and Navy. PIT/PAYE remittance from staff of the Nigerian Police, in Lagos. 2. Western Region a) Ibadan I ITO Adeoyo. 45, New Adeoyo, Hospital Road, Ibadan. b) Abeokuta ITO Oke Mosan, Opp. Govt. Office, IBB Boulevard, Abeokuta. c) Ilorin ITO 1, Obbo Road, Behind 1st Bank Plc, Off Unity Road, Ilorin. d) Akure ITO Alfred Revenue Rd, Alagbaka, Akure. e) Ado-Ekiti ITO 79, Iyin Road, Basiri Area, Ado-Ekiti. f) Oshogbo ITO Ibadan/Gbongan Road, Oshogbo. PIT/PAYE remittance from the

17 staff of the Nigerian Police in Oyo State. PIT/PAYE remittance from the staff of the Nigerian Police in Ogun State. PIT/PAYE remittance from the staff of the Nigerian Police in Kwara State. PIT/PAYE remittance from the staff of the Nigerian Police in Ondo State. PIT/PAYE remittance from the staff of the Nigerian Police in Ekiti State. PIT/PAYE remittance from the staff of the Nigerian Police in Osun State. 3. East Region a) Enugu ITO 7, Ridgeway Rd, P.M.B. 1093, Enugu. b) Awka ITO 43, Nnamdi Azikwe Avenue, Behind Union Bank, Awka. c) Abakaliki ITO 37 Ogoja Road, Abakaliki. d) Umuahia ITO 108, Aba Road, Umuahia. e) Owerri ITO Km 3, Owerri/ Onitsha Road, Owerri. PIT/PAYE remittance from the staff of the Nigerian Police in Enugu State. PIT/PAYE remittance from the staff of the Nigerian Police in Anambra State. PIT/PAYE remittance from the staff of the Nigerian Police in Ebonyi State. PIT/PAYE remittance from the staff of the Nigerian Police in Abia State. PIT/PAYE remittance from the staff of the Nigerian Police in Imo State. 4. South South Region a) Benin ITO 53, Airport Road, Benin. b) Calabar ITO 7, IBB Road, Uyo c) Yenagoa ITO Otiotio Street, Yenagoa. d) Uyo ITO 149, Ikot Ekpene Road, Uyo. e) Asaba ITO Plot 4, Govt. House, Anwal Road, Asaba, PIT/PAYE remittance from the staff of the Nigerian Police in Edo State. PIT/PAYE remittance from the staff of the Nigerian Police in Cross-River State. PIT/PAYE remittance from the staff of the Nigerian Police in Bayelsa State. PIT/PAYE remittance from the staff of the Nigerian Police in Akwa-Ibom State. PIT/PAYE remittance from the staff of the Nigerian Police in Delta State. 5. North-Central Region a) All ITO within FCT, (Garki, Central, Wuse & G/Lada) b) Bauchi ITO Federal Low Cost Housing Estate, Bauchi. c) Jos ITO Adjacent to Federal Secretariat Complex, Jos d) Lokoja ITO Ganaja Junction, P.M.B1116 Lokoja. e) Lafia ITO Lubuna House, Makurdi Rd, Lafia. f) Makurdi ITO Jonah Jang Crescent Road, Makurdi. g) Minna ITO Adjacent to NACB Building Minna. PIT/PAYE remittance from the

18 staff of the Nigerian Police in FCT Abuja as described in A above. PIT/PAYE remittance from the staff of the Nigerian Police in Bauchi State. PIT/PAYE remittance from the staff of the Nigerian Police in Plateu State. PIT/PAYE remittance from the staff of the Nigerian Police in Kogi State. PIT/PAYE remittance from the staff of the Nigerian Police in Nasarawa State. PIT/PAYE remittance from the staff of the Nigerian Police in Benue State. PIT/PAYE remittance from the staff of the Nigerian Police in Niger State. 6. North-West Region a) Kaduna (North) ITO No.3, Broadcasting Road, Kaduna. b) Katsina ITO 254A,IBB Way, Katsina. c) Sokoto ITO Kano Road, Sokoto. d) Gusau ITO 1, Park Road, Gusau. e) Birni-Kebbi ITO Opp. Adamu Aleiro Housing Est., Gwadagaji Area. f) Dutse ITO 9, Bagudu Road, Dutse. PIT/PAYE remittance from the staff of the Nigerian Police in Kaduna State. PIT/PAYE remittance from the staff of the Nigerian Police in Katsina State. PIT/PAYE remittance from the staff of the Nigerian Police in Sokot State. PIT/PAYE remittance from the staff of the Nigerian Police in Zanfara State. PIT/PAYE remittance from the staff of the Nigerian Police in Kebbi State. PIT/PAYE remittance from the staff of the Nigerian Police in Jigawa State. 7. North-East Region a) Maiduguri ITO Airport Road, P.M.B 11175, Maiduguri. b) Yola ITO Galadima Aminu Way, P.M.B 2115, Jimeta Yola. c) Damaturu ITO Potiskum Rd, Opp. NTA, P.M.B 1095, Damaturu. d) Gombe ITO Sabon Line, Opp. Chimax Inter-biz, Gombe. e) Jalingo ITO No.7, Barde Way, P.M.B 1108, Jalingo PIT/PAYE remittance from the staff of the Nigerian Police in Borno State. PIT/PAYE remittance from the staff of the Nigerian Police in Adamawa State. PIT/PAYE remittance from the staff of the Nigerian Police in Yobe State. PIT/PAYE remittance from the staff of the Nigerian Police in Gombe State. PIT/PAYE remittance from the staff of the Nigerian Police in Taraba State. Education Tax This is a tax that came into being through Decree No 7 of 1993 and commenced implementation in1995. It is imposed on companies registered in Nigeria that are liable to pay tax on their assessable profits as defined in CITA

19 or PPTA as the case may be. The rate of the tax is 2% of the assessable profit. The assessment of the education tax and that of the Companies Income Tax are done concurrently. The due date of payment of education tax is sixty days after the notice of assessment has been served. Any tax outstanding after the due date will attract a penalty of 5% plus interest at commercial rate. Stamp Duties They are duties paid basically on Instruments, (stamp duties Act, Section 23) and for the purposes of stamp duty, and Instrument is defined to include every written document. If a transaction is effected orally or arises only from the conduct of the parties involved so that there is no document to stamp, then there can be no duty. It is therefore advisable that transactions must always be in writing to avoid unnecessary legal tussle, although it is dependent on the level of sensitivity of the transaction. Essence: The primary essence of duty stamping agreements and/or Instruments is that such documents become valid, legal and admissible in any Tribunal or court of record in Nigeria. Therefore, the duty stamping of Instruments is actually in the best interest of the Contractor or Consultant in case of trouble. Information Technology Development Levy The National Information Technology Development Agency (NITDA) Act, 2007 empowers FIRS to assess and collect the NITDA levy imposed under section 12 of the Act. A levy of 1% is charged on the profit before tax of companies and enterprises listed below with an annual turnover of N100 million and above.the levy when paid by the companies shall be deductable. The businesses are as follows: GSM service providers and all Telecommunication Companies. Cyber Companies and internet providers. Pension Managers and pension related companies. Banks and other financial Institutions and Insurance companies.