Tax Waiver of Penalties and Interest on all outstanding tax Liabilities Announced By Federal Inland Revenue Services (FIRS)
According to the agency, the concessions were taken into consideration in recognition of the difficulties encountered by numerous taxpayers in settling their unpaid tax obligations and in accordance with the government's pledge to assist businesses. These concessions are in accordance with Section 32 of the Federal Inland Service (Establishment) Act, LFN 2004 (as amended).
According to a statement released by Zack Adedeji, the Executive Chairman of FIRS, if the outstanding uncontested liability is still repaid in full or in part at the end of the one-time concession window, the entire penalty and interest would be reintroduced.
According to Section 27(2) of the FIRS Act, failure to comply with a demand made by the FIRS for payment of an unpaid tax, rather than failing to pay the tax at all, may result in penalty obligation.
According to Section 40 of the same Act, interest and penalties start to accrue on the day of default when it comes to withholding tax.
As a result, upon conviction, the taxpayer will be responsible for paying the interest and penalty in addition to the tax that should have been withheld and returned.
According to the FIRS statement, "The Federal Inland Revenue Service has approved the following tax concessions for taxpayers with outstanding tax liabilities, in accordance with Federal Inland Revenue Service (Establishment) Act, LFN 2004 as amended, in recognition of the difficulties that many taxpayers have faced in settling their outstanding tax liabilities and in line with the commitment of the current government to support businesses: Complete forgiveness of interest charges and penalty for unpaid taxes on outstanding tax liabilities.
“Taxpayers are advised that the waiver of interest is subject to the full settlement of outstanding principal on or before 31 December 2023.
“Please note that the full penalty and interest shall be reinstated after the expiration of this one-off concession window where the outstanding undisputed liability remains fully or partially unpaid.
“The FIRS appreciates all taxpayers who have been diligent in complying with their tax obligations as and when due while serving their continued support and cooperation for a more responsive and robust tax system,”
