By Chioma Obinagwam
Nigeria’s apex tax administration agency, the Federal Inland Revenue Service (FIRS), has requested companies that enjoyed capital allowances on Qualifying Capital Expenditure (QCE) on N500,000 and above between the years between years 2016 and 2021 for assessment.
Confiance News gathered from the official Twitter handle of FIRS on Monday.
“In line with Section 3 of the Industrial Inspectorate Act, Cap. 18 LFN 2004 (as amended), that any person incurring Qualifying Capital Expenditure (QCE) of N500,000 and above is required to obtain Certificate of Acceptance, from the Industrial Inspectorate Division of the Federal Ministry of Industries, Trade, and Investment in respect to that QCE,” the Executive Chairman, FIRS, Muhammad Nami, ordered.
According FIRS, QCE are assets on which capital allowances are claimable.
More so, Confiance News learnt that taxpayers who failure to comply with with the order by 31st October 2022 would suffer forfeiture of such incentive. the
Nami added they are to submit the certificate of acceptance every year to the tax office effective from this year.
He explained that by the provisions of Section 5 (1) (a) of the Act, the Service may take account of any fact contained in the acceptance certificate in the exercise of its functions, including granting of capital allowance under the second schedule to the Company Income Tax Act (CITA) Cap. C21, LFN 2004 (as amended).
The Executive Chairman noted that Section 26 of the FIRS (Establishment) Act, 2007 (as amended) and Section 60, of the CITA, provide that the service may, by notice, call for the submission of book, document or record at the place and time stated in the notice.
“In view of the foregoing, the Service, by this notice, requests all companies that enjoyed capital allowances on QCE (of N500,000 and above) between 2016 and 2021 years of assessment to submit the Certificate (s) of Acceptance issued by the Industrial Inspectorate Division of the Federal Ministry of Industries, Trade, and Investment. The Certificate (s) of Acceptance shall be submitted to the tax office where the company’s tax file is domiciled not later than 31st October 2022,” he disclosed.
“The Service may withdraw the capital allowances enjoyed for the relevant years by any company that failed to comply with this notice with a consequential additional tax assessed accordingly,” he continued.
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