July 11, 2020
On 9th July, 2020, the Lagos State Internal Revenue Service (“LIRS” or “the Service”) issued a Public Notice granting taxpayers additional incentives to ease the impact of the COVID-19 Pandemic on individuals and businesses.
In recent times, the LIRS has undertaken a number of measures to mitigate the impact of the COVID-19 Pandemic on taxpayers and business continuity. These measures include, amongst others things, the extension of the deadline for filing tax returns from 31st March, 2020 to 30th June, 2020. (Read our tax alert on this here).
According to the Public Notice, the LIRS has begun implementing the following additional measures to ease the impact of the Pandemic on taxpayers:
The LIRS’ efforts to mitigate the impact of the COVID-19 Pandemic on taxpayers is commendable. Taxpayers are advised to take advantage of these palliatives by complying with their tax obligations within the stipulated timelines. Specifically, taxpayers with outstanding audit liabilities arising from 2009 to 2015 should take note of the waiver of interests and penalties and liaise with their tax consultants to structure their payment plan within the available window which elapses on 31st December, 2020. The waiver of accumulated interest and penalties arising from the years 2009 to 2015 should significantly reduce taxpayers’ total liability. In addition, Lagos state resident taxpayers that have previously made or intend to make donations to the State Government in the fight against the COVID-19 Pandemic should ensure to take advantage of the 20% tax credit granted in computing their tax returns for the 2021 YOA and liaise with their tax consultants in doing so. Although the Notice does not state the modality of determining the monetary value of donations made in kind, we expect the LIRS to provide additional clarification in this regard in due course.