The Federal Inland Revenue Service (FIRS) is set to conduct a comprehensive Value Added Tax (VAT) and Withholding Tax (WHT) compliance monitoring exercise across the nation. FIRS Executive Chairman, Zacch Adedeji, made this announcement in a statement, outlining the objectives and scope of the exercise.
The primary purpose of this nationwide exercise is to ensure that taxpayers are adhering to their tax obligations, particularly concerning VAT and WHT. It aims to verify whether the correct amounts of VAT and WHT are being remitted to the government by taxpayers.
The exercise is conducted in accordance with Sections 2, 8, 26, and 29 of the Federal Inland Revenue Service (Establishment) Act 2007 (as amended). It is applicable to all taxable entities and tax agents, including Non-Governmental Organizations (NGOs) and various government entities at the federal, state, and local levels.
A team of officers from the FIRS will visit selected taxpayers, including companies, NGOs, and government entities, to review their VAT and WHT records. The exercise will encompass the accounting years from 2019 to 2022 for taxpayers whose records were audited by the FIRS up to the 2018 accounting year.
All taxable entities or tax agents who have made deductions of VAT or WHT on behalf of the FIRS are required to promptly remit these deductions to the FIRS within two weeks of the official publication of this exercise.
The FIRS will notify the taxable entities or tax agents selected for the VAT and WHT compliance monitoring exercise. The notification will specify the documents required for the exercise.
This nationwide monitoring exercise underscores the FIRS’s commitment to ensuring tax compliance and the correct remittance of VAT and WHT. It also serves as a mechanism to strengthen revenue collection and promote transparency in taxation. Entities subject to this exercise should prepare to cooperate with FIRS officials to facilitate the review of their records.