Introduces new taxes on non-resident companies in digital and professional services
31 Dec 2021
The Finance Act 2021 was signed into law on 31 December 2021, amending different tax and fiscal legislation. Section 13 of the Company Income Tax Act (CITA) has been amended to incorporate the taxation of non-resident companies carrying on business in Nigeria previously covered in the Companies Income Tax Order, 2020. It subjects companies engaged in digital services and the provision of technical, management, consultancy or professional services to income tax. Also, the capital allowance to be claimed in any year of assessment will be limited to the amount relating to the qualifying capital expenditure employed in generating the assessable profits of that year of assessment. If the qualifying capital expenditure is in respect of an asset that was partially utilized to generate taxable income, such asset will qualify for prorated capital allowance, provided that the proportion of non-taxable income is greater than 20% of the total income of the company.
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Type:
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Treatment and operation (Corporate taxation)
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Promotion and facilitation (Investment incentives)
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Industry:
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Services (Telecommunications)
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Sources:
