Effective March 1st to 31st, 2022, taxpayers with pending foreign currency tax liabilities will be able to settle these obligations in Naira during the Federal Inland Revenue Service (FIRS) one-month window, the Executive Chairman, Muhammad Nami, has said.
Nami, disclosed this in a statement signed by his media aide, Johannes Oluwatobi Wojuola, said several taxpayers have contacted FIRS regarding financial difficulties obtaining foreign currencies to offset outstanding taxes owed.
He said the concession became necessary “In view of the number of requests, enquiries and the challenges encountered by the taxpaying public in sourcing for foreign currencies to offset outstanding tax liabilities.”
The extant provision is that the currency of the transaction should be the currency with which the tax is paid. However, this is a one-off window/concession, and the Service would no longer entertain any such request from the taxpaying public.
The Service therefore informed taxpayers that “a one-month window has now been opened for this category of taxpayers to settle their foreign currency tax liabilities in Naira with effect from the 1st of March, 2022 to 31st of March, 2022.”
The statement further reads: “The extant provision is that the currency of the transaction should be the currency with which the tax is paid. However, this is a one-off window/concession, and the Service would no longer entertain any such request from the taxpaying public.
“The applicable rate shall be the Investors and Exporters (I&E) Foreign Exchange Rate of the Central Bank of Nigeria (CBN) prevailing on the date of the transaction and or when the tax obligation falls due.”
However, the FIRS clarified that “This concession is available to all taxpayers, covers all tax types, and all foreign currency tax liabilities falling due on or before 31st December 2021, except for companies in the Upstream (Oil & Gas) Sector, and the Petroleum Profits Tax.”
To qualify for this program, taxpayers within this category will have to make all payments before March 31st, and upon payment, the relevant documents relating to the transaction will have to be forwarded to the Office of the Executive Chairman, along with a copy to the local tax office where the taxpayer’s file is located.
