obitaxanswer

WHAT IS  VAT?   VAT is a tax on value added on goods and services. The value added on a product is  the output value minus the input cost. Value added tax has been successful in many countries. It has been challenging especially in the area of international online business. Recently some countries has asked online vendors to register for VAT in the country of buyer. Below are some VAT penalties in Nigeria. FAILURE TO REGISTER FOR VAT  According to VAT Act 1993 as amended 1.A taxable person shall, within six months of the commencement of the Act, or six months of the commencement of business, whichever is earlier register with Firs 2.A taxable person who fails or refuses to register within the specified period shall be liable to N10,000  for the  first month and N5,000 for each of  the subsequent month in which the failure occur. FAILURE TO REMIT TAX.  1 . Failure to remit tax  within the specified periods...

What is transfer Pricing? It is the pricing of  goods and services for related parties or connected persons.   Examples of related parties transactions includes the following:  1.Transactions between a company and its Subsidiary or related company. 2.Transactions between a director and his/her company. 3.Transactions between  a person with substantial amount of shareholding and his/her company. 4.Transactions between a company and a person related to the principal  officer of that company.    For example C.E.O's wife and the company. 5. Transactions between companies where  the director of one of the companies has a substantial interest in    another. 6 . Transactions between blood relations and relatives. 7. Transactions between employer and the employee. It is necessary that  businesses establish a transfer Pricing policy and good transfer pricing  documentation that reflects market value.  ...

  Effort made to get a good tax consultant will not be in vain. Getting  a good tax consultant can make a big difference. -'know that whether you get a good tax consultant or a bad tax accountant'  y ou are still responsible for the content of  your tax returns. - You should be involve.   How do I get a good tax consultant ? Tax consultant  who is knowledgeable both in tax laws and accounting skills can be of great benefit to you. You can get a good tax consultant through- -Referrals -And checking out credentials and experience What can tax consultants do for you? -They can see how you can benefit from favorable tax provision. In some countries government might want to encourage savings, they can exempt income saved from tax, likewise health insurance and others.  -They can apply tax law in your tax calculation which you might misapply.               -They ...

What to know about deducting WHT in Nigeria . Withholding Tax (WHT) is a pre-payment of income tax which can be used to reduce tax liability. It is necessary that business owner and company deduct WHT (WITHHOlDING TAX)  when making payments to contractors, consultant, interest owners and  'others' and remit within 21days.   RATE OF WHT            COMPANY%     INDIVIDUAL% ROYALTIES                         10                  10 RENT                                   10        ...

Starting  a  new business can be challenging especially from tax perspective. It is necessary that  new business know the following tips.   1.Registration of your business for tax. Always register your business  with FIRS and the state government  of residence. Firms, individuals doing business and  registered businesses need to register for VAT while companies need to register for VAT and company income tax. It is necessary to register your business even when you are anticipating commencement. This is necessary to avoid penalty and 'headache' during start up.   2.keep track of your business transactions.   keep track of your expenses, income, purchases and disposals. Even when you don't have a computerised accounting  system. Your receipts can be kept in a paper envelope and in a safe custody. Always demand for evidence of payments for any transactions.   ...

        Tax planning means legally arranging a person or corporate finance, business and tax affair in order to reduce tax burden. Note that ‘aggressive’ tax planning to the detriment of the government can be termed illegal. However the tax payer as a rational person will always try to minimize  his/ her tax liability.   T ax avoidance is legal while tax evasion is illegal.     REQUIREMENT FOR TAX PLANNERS   ·           Knowledge of tax laws (statutes, enactment, past and current case laws.)   ·           Financial management.   ·           Ability to apply  tax skills to client peculiar circumstance. ·           Understanding of client operating environment.    TECHNIQUES OF TAX REPORTING 1...