Introduction: A New Era for Nigerian Taxation
The year 2024 marks a pivotal shift in Nigeria’s financial landscape with the introduction of landmark tax reforms. These sweeping changes are designed to simplify compliance, stimulate economic growth, and provide relief for businesses and individuals alike.
This post from Philips Oyedele & Co. provides a high-level summary of the most critical updates. For a comprehensive breakdown, we encourage you to download our detailed guide.
Key Highlights of the 2024 Tax Reforms
The new laws introduce significant changes across several key areas:
- Major Relief for SMEs: The threshold for Corporate Income Tax (CIT) exemption has been quadrupled from ₦25 million to ₦100 million in annual turnover. This is a game-changing update that brings tax-free status to thousands more growing businesses.
- Withholding Tax (WHT) Exemptions: SMEs with a turnover below ₦25 million are now exempt from WHT, easing cash flow pressures significantly. Furthermore, a new “No TIN, No Deduction” rule is enforced with stricter penalties, while WHT refund processes have been streamlined.
- Personal Income Tax (PIT) Relief: A new zero-tax bracket has been created for individuals earning ₦800,000 or less per annum. The reforms also introduce clearer, more progressive tax bands for higher earners.
- Increased Compensation Payout Exemption: The tax-free limit on severance and termination payments has been raised substantially from ₦10 million to ₦50 million.
- Unified Compliance and Dispute Resolution: Tax administration is now unified under the new Nigeria Revenue Service (NRS), promising simpler e-filing. A clearer process for resolving disputes has also been established through the Tax Appeal Tribunal and a new Tax Ombud.
What This Means for You
These reforms offer significant opportunities for tax savings and operational efficiency, but they also require careful review of your current financial strategies. Businesses must ensure they meet the criteria for new exemptions, while individuals should understand how the new PIT structure affects them. The move towards digital, unified compliance is a welcome change that promises a more efficient system for all.
How We Can Help
Navigating these changes requires expert guidance. The team at Philips Oyedele & Co. can help you:
- Review your tax structure to maximize benefits.
- Ensure full compliance with new WHT and CIT rules.
- Manage your payroll to reflect the updated PIT thresholds.
- Navigate the new NRS e-filing and dispute resolution frameworks.
Download the Full, Detailed Guide
This post is only a brief overview. To get a complete, in-depth understanding of every change and what it means for you or your business, download our comprehensive guide.
Have Questions?
If you require professional assistance in adapting to these new laws, please feel free to reach out to our team at any time. We’re here to ensure your tax affairs remain fully compliant and optimized.
