FG Launches New Option for Tax Payment in Installments

The Federal Government of Nigeria has put forth a proposal to allow individuals to pay their taxes in installments, as outlined in the recently submitted Nigeria Tax Bill 2024.

This initiative aims to provide taxpayers with the option to either make a single lump-sum payment or spread their tax obligations over time, ensuring that all payments are completed by the designated filing deadline.

In addition to this flexibility, the government plans to establish a dedicated account managed by the Accountant-General of the Federation specifically for handling tax refunds. This move is part of a broader set of tax reforms aimed at enhancing revenue collection efficiency across the country.

The proposed reforms include four new bills that have been forwarded to the National Assembly, designed to align with recommendations from the Presidential Fiscal Policy and Tax Reforms Committee, led by Taiwo Oyedele.

These reforms seek to streamline the collection of direct taxes and various levies while prohibiting several agencies, including the Nigerian Customs Service and Nigerian Ports Authority, from participating in revenue collection activities.

An analysis of the 160-page draft bill reveals that it explicitly allows for tax payments in installments. Section 48 specifies that individuals can fulfill their tax obligations through equal monthly payments, with the final installment due by the filing deadline.

Moreover, the bill outlines procedures for refunding any overpayments made by taxpayers following an audit by the relevant authorities.

Refunds are mandated to be processed within 90 days of a decision by the tax authority and may also be set off against any outstanding tax liabilities.