FIRS insists CSOs have tax obligations

The Federal Inland Revenue Service (FIRS) has insisted all Civil Society Organisations (CSOs) and cooperative societies have responsibilities under the tax laws to fulfil their tax obligations irrespective of the nature of their operations.

It noted that organisations, institutions and companies engaged in ecclesiastical, charitable, benevolent, literary, scientific, social, cultural, sporting or educational activities of a public character must comply with tax provisions.

The FIRS and the Joint Tax Board (JTB) in a webinar jointly organised by the FIRS and the European Union-funded, British Council managed Agents for Citizen Driven Transformation (EU-ACT) Programme, emphasised that CSOs have the responsibility to file tax returns and statements of affairs, adding that the tax authorities would demand payment of taxes from CSOs only when the CSOs were engaged in businesses and make profits from the business ventures.

The Executive Chairman of FIRS, Muhammad Nami, represented by the Coordinating Director, Compliance Support Group of FIRS, Dick Irri, in declaring the webinar open, said FIRS would continue to partner with stakeholders such as the co-organisers of the programme in their drive to help educate taxpayers on their responsibilities.

The Director, Tax Policy and Advisory Department of FIRS, Temitayo Orebajo in his presentation on the tax obligation of CSOs refuted claims by some individuals that CSOs have no tax obligation.

“There is a penalty for CSOs not filing and there is a penalty for late filing. Whether you (CSOs) have something to do or not, you have the responsibility to file. After one year you are registered, in order not to run afoul of the law, you need to go and file at least your statement of affairs. It may be just a one-page document.

“All CSOs are expected to register for tax purposes and obtain a Taxpayer Identification Number (TIN). The following documents are required for tax registration: A copy of the registration certificate issued by the Corporate Affairs Commission (CAC) or any other instrument of registration; Certified True Copy (CTC) of memorandum and articles of association, constitution or rules and regulations governing the CSO; list and profiles of the Trustees/Board members nominated and other relevant documents,” he said.

Another panelist and Deputy Director of Tax Policy and Advisory Department in the webinar, Olatunji Olabode noted that CSOs should file returns and pay taxes (where applicable) at MTOs closest to them or use the TaxPro Max Solution.

Olabode noted that with the introduction of the TaxPro Max solution, CSOs could file returns and pay taxes from the comfort of their homes and offices.

“Section 55(1) of CITA mandates every company in Nigeria including CSOs to file annual tax returns. A tax return comprises: an audited account, tax and capital allowances computations and a true and correct statement in writing containing the amounts of its surplus from every source computed; a completed self-assessment form; particulars as may be required in the form concerning profits, allowances, reliefs, deductions required; a declaration to be signed by a trustee, director, secretary or any authorised person of the organisation that the information contained in the return is true and correct; the period for filing returns shall be as stipulated in the relevant tax laws”, he said.

A representative of the JTB and its Head, Legal, Nneka Esomeju added that CSOs who are registered as individuals or Business Names or any other law at the sub-national level should also comply and fulfil their tax obligations under the Personal Income Tax Act relevant with the State Board of Internal Revenue.

“If any CSO is not registered or overseen by the FIRS, they should register and file their returns and pay taxes (where applicable) to the State Board of Internal Revenue. Not being registered with FIRS or CAC does not mean that you are exempted from taxes.

She also clarified that any individual who earns income beyond the threshold of the minimum wage should pay taxes irrespective of the status of the individual.