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Coca-Cola was among some companies given the Most Response Tax Payer Award (PAYEE) by the Lagos State government recently. This was as a result of their adherence and prompt remittance of taxes.
The award was received by Mrs. Seye Sandey, Finance Director on behalf of the company.
Coca Cola uses HumanManager for their HR, Payroll and Pension management. HumanManager remains Nigeria's leading human capital management software solution. It makes it easy for HR managers to calculate the PAYE tax scheme as provided by the Personal Income Act of 2004.
The Act states that all employers of labour, agents and consultants are to ensure that employees make full disclosure of all their incomes. This should be at the beginning of the year, whether or not such income is received in Nigeria when tax forms 'A' are completed by them before returning same to the tax office.
Such disclosure should encompass all income earned, accruable, derived and accumulated in and outside Nigeria as well as full disclosure of all salaries and allowances paid either in cash or kind. All employers of labour, agents, consultants and employees who engage in incomplete disclosure of income are liable to being charged for concealment of information with intent to defraud the Government of Nigeria.
Due to poor understanding of the Act and its operation, a good number of employers have some challenges in complying fully with its provisions.
Looking ahead, the Joint Tax Board recently came out with its PAYE Guidelines 2009. These guidelines are to be used as standards for making deductions and payments to tax offices on a monthly basis.
In order to help ensure a hitch-free practice of this tax scheme there is a need for a proper understanding of the terms used in the scheme:
Employment: this refers to services rendered by any person in return for any gain or profit. The profit from an employment is deemed to be derived from Nigeria if the duties of the employment are wholly or partly performed in Nigeria or the employer is in Nigeria, even if the gain is not received in Nigeria.
Assessable Income: this is the income of an employee for each year of assessment and from every source of income.
Emolument: this means the total emolument including all allowances, salaries, wages, bonuses and compensation.
Fringe Benefits: this means benefits accruable to an employee when an employer's asset is put to the employee's use, the amount to be taxed is 5% of the acquisition cost. If the asset is hired, then the amount to be taxed will be the difference between the amount incurred and the amount refunded by the employee.
Income Tax Relief: this means the sum of personal allowance and other relief given to an employee in the year of assessment.
Tax Emolument: this means emoluments reduced by tax free emolument.
Total Income: this is the aggregate assessable income of an employee for the year after deductions and additions as allowed by law.
Posted on Monday, February 02 @ 08:26:10 CST by clickadmin |
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