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WITHHOLDING TAX RATES IN NIGERIA : ALL YOU NEED TO KNOW

WITHHOLDING TAX RATES IN NIGERIA : ALL YOU NEED TO KNOW

WHAT IS WITHHOLDING TAX (WHT)

Withholding tax (WHT) is the tax required by the Law to be withheld by a party from each payment made to another contracting party from the income or services it rendered. When this tax is withheld, it is required to be remitted periodically to the Government Inland Revenue Service who then issue a Withholding Tax Credit Note for the benefit of the party whose income was withheld. Withholding tax can be said to be an advance payment of income tax. In Nigeria, Withholding tax rates in Nigeria had been introduced by the Federal Government to increase it revenue, increase the efficiency of tax collection in the country as well as prevent tax evasion.

withholding tax rates in Nigeria

WITHHOLDING TAX RATES IN NIGERIA

The Withholding Tax Rates in Nigeria { WHT } varies among individuals and companies / corporate bodies. These also varies amongst either the individuals or companies involved. In general, the WHT for individuals is anything from 5 percent to 10 percent while for companies, it is between 2.5 percent to 10 percent.

WITHHOLDING TAX COLLECTING AGENTS IN NIGERIA

Withholding tax is been collected by all organisations or bodies making payments to
suppliers of goods and services by making deductions of Withholding Tax and then remitting it to the Tax Authority as payments are being made.

DUE DATE FOR FILING WITHHOLDING TAX RETURNS

For filing of WHT, it can be done either on or before the 21st day of the month following the month in which the deductions were made.

DOCUMENTS NEEDED FOR FILING WITHHOLDING TAX RETURNS IN NIGERIA

2 relevant documents are needed for filing a WHT, These includes

  • an evidence of payment such as bank teller, e-ticket from a Federal Inland Revenue Service (FIRS) designated revenue collecting bank
  • and a schedule of WHT deducted indicating the Name of Supplier or vendor, the Taxpayer Identification Number (TIN) of the supplier or vendor whose tax was withheld and the related amount.

That’s it from NaijaQuest on ” All You Need To Know about Withholding Tax Rates in Nigeria “, as usual, we would like to know your thoughts and suggestions through the comment box and remember like us on facebook @ facebook.com/9jaquest or follow us on twitter @ twitter.com/NaijaQuest. Thanks

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Tags : Withholding Tax Rates in Nigeria , withholding tax returns , withholding tax collecting agents in Nigeria 

Updated: August 20, 2017 — 6:04 pm

1 Comment

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  1. Dear Sir,

    Please as a beginner,how much is my company is to pay per any contract executed as regards of withholding tax.

    Kindly need some info

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