The Minister of Industry, Trade, and Investment has issued the Industrial Inspectorate Regulations 2022 (Regulations). The Regulations show the application and collection fees for an acceptance certificate in Nigeria. Where a company does not meet the rule, FIRS may remove…
The Federal Inland Revenue Service (FIRS) has released a public notice on the submission of a certificate of acceptance. Section 3 of the Industrial Inspectorate Act, Cap. I8, LFN 2004 (as amended), provides that any person incurring Qualifying Capital Expenditure…
In financial accounting, a business can depreciate its fixed assets with a straight-line method or reducing balance method or units of production. However, the principle is different for calculating the capital allowance. All taxpayers must use the same rate. Schedule…
In our previous article, we discussed the theory of capital allowance in Nigeria. Now, we shall consider three (3) examples on how to calculate capital allowance in Nigeria. Question 1: In January 2018, Company Bee bought plant and machinery…
Capital allowance is an allowance granted for income tax purposes instead of depreciation. It reduces the taxable profits and tax liability of a business. However, a taxpayer in Nigeria must fulfill four (4) conditions so as to claim capital allowance…
Businesses often buy items that will generate benefits above 12 months. When these items are also tangible and hard to convert into cash, they are called fixed assets. Each company is free to set a threshold for recognizing fixed assets…
