Business - Business & Economy - News - October 9, 2021

Companies risk N25,000 penalty, interest for late filing of 2021 tax returns, FIRS warns

MEDIATRACNET

Late filing of returns on Company Income Tax (CITA) beyond November 30,2021 for the 2021 tax year would attract penalty and interest, the Federal Inland Revenue Service (FIRS) has warned.

The warning to companies doing business throughout Nigeria was contained in a public notice on Friday signed by the FIRS Chairman, Muhammad Nami.

Titled “Expiration of Waiver of Late Returns Penalty and Interest on Filing of Companies Income Tax (CITA) Returns for 2021 Year of Assessment (YOA)”, the notice said the grace period extended for companies to migrate to the new platform for filing returns on CITA for 2021 Year of Assessment would expire on November 30, 2021.
 
In June this year, the Service announced the suspension of the imposition of penalty and interest on late filing of Company Income Tax (CITA) Returns for 2021 Year of Assessment.

The decision to suspend the penalty was to allow the seamless migration by businesses and taxpayers to the use of the TaxPro-Max platform made mandatory in June 2021.

TaxPro-Max is a solution introduced by the FIRS for the payment of taxes and filing of all Naira-denominated tax returns. 
 
The suspension order on late returns penalty and interest on CITA Returns for 2021 Year of Assessment (YOA) was to companies whose tax filings were due for filing on or before June 30, 2021 to do so.

This was to give room for taxpayers to reconcile their respective tax accounts, including withholding tax (WHT) credit notes, for effective on-boarding to TaxPro-Max.
 
Taxpayers were directed to take advantage of the period of extension to conclude all processes of reconciliation and submission of their Naira-denominated CITA Returns for 2021 YOA on TaxPro-Max on or before November 30, 2021 to avoid the prescribed penalty and interests.
 
The FIRS any CITA Returns for 2021 YOA not submitted within this grace period would be subject to late returns penalty and interests with effect from the due date of such returns.

Under the provisions of the Finance Acr 2021, failure to file company income tax (CIT) returns attracts a penalty of N25,000 for the first month after it became due and N5,000 for each subsequent month of default. Late payment of CIT attracts a 10 percent penalty and interest at the prevailing monetary policy rate approved for all commercial banks.

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