ALL THE TAXES YOUR BUSINESS MUST PAY (VALUE ADDED TAX)

Value Added Tax (VAT) is a consumption tax placed on a product whenever a value is added at each stage of the supply chain from the production stage to the point of sale. The retailer pays the VAT. 

The rate of VAT in Nigeria is 7.5%, The Federal Inland Revenue Service (FIRS) is the sole agency for administering VAT in Nigeria.

A taxable person registers for VAT at the commencement of the business in Nigeria. A taxable person may register at a selected FIRS office by submitting a properly completed Taxpayer registration form and other documents. 

A small business may voluntarily register with the FIRS to collect, remit, and file monthly returns. However, the person must notify the FIRS and will adhere to the VAT requirements for non-exempt individuals.

FIRS uses selected banks as collection agents for payment into the VAT accounts. 

What documents are needed to file VAT returns?

- Payment receipt from FIRS selected revenue collection bank.

- VAT Returns form; Returns can be submitted at the specified tax office or online through the FIRS portal.

-The name, taxpayer identification number (TIN), and amount of VAT collected are listed on a VAT collection schedule.