Cross-border income – NBC Institute

AT – Nov 2022 – L3 – Q6 – Double Taxation Reliefs and Credits

Evaluate whether Singapura PTC Limited, a Singaporean company, qualifies for tax exemption in Nigeria due to the Nigeria-Singapore double taxation agreement (DTA). Outline the benefits available under the DTA to Singaporean residents and identify scenarios where the company would still be liable for tax in Nigeria.

Question

Singapura PTC Limited, a company registered in Singapore, derived various income streams from Nigeria in 2021. Following this, the Nigerian tax office issued an assessment based on the Companies Income Tax Act, prompting Singapura PTC Limited to request an objection. The company claims that, as a Singapore resident, it should not be liable for Nigerian taxes due to the double taxation agreement between Nigeria and Singapore.

Required:

Do you agree with the company, that its residence in Singapore qualifies it for tax exemption in Nigeria?
(5 Marks)
What are the benefits that may be available to a resident of Singapore under the double taxation agreement between Nigeria and Singapore?
(5 Marks)
State FIVE circumstances under which a company registered in Singapore will be liable to tax in Nigeria.
(5 Marks)

Answer

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Topic: Double Taxation Reliefs and Credits
Series: NOV 2022

AT – July 2023 – L3 – Q1b – International taxation

Calculating the tax payable for a resident company with cross-border income from Ghana and Nigeria.

Question

Libir Ltd is a resident company incorporated in Ghana. Its trading partners have been customers and suppliers from Ghana and also from Nigeria. The company supplies animal feed.

Its operation for 2021 year of assessment is as follows:
Income from Ghana: GH¢10,000,000
Income from Nigeria: ₦1,000,000,000

Additional information:

Allowable expense granted by the Ghana Revenue Authority is GH¢6,000,000.
The allowable expense in 1 does not include capital allowance of GH¢1,200,000 which was legitimately claimable by the company.
The tax paid in Nigeria amounted to ₦40,000,000. The withholding taxes paid in Ghana with evidence of tax credit certificates amounted to GH¢1,000,000.
The taxpayer has written to the Commissioner-General to relinquish its right under the double taxation arrangement.
Exchange rate is GH¢1 = ₦60.

Required:
Compute the tax payable.

Answer

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Tags: Allowable expense, Cross-border income, Double Taxation, Tax computation
Level: Level 3

Topic: International taxation
Series: JULY 2023

AT – Nov 2022 – L3 – Q6 – Double Taxation Reliefs and Credits

Evaluate whether Singapura PTC Limited, a Singaporean company, qualifies for tax exemption in Nigeria due to the Nigeria-Singapore double taxation agreement (DTA). Outline the benefits available under the DTA to Singaporean residents and identify scenarios where the company would still be liable for tax in Nigeria.

Question

Required:

Do you agree with the company, that its residence in Singapore qualifies it for tax exemption in Nigeria?
(5 Marks)
What are the benefits that may be available to a resident of Singapore under the double taxation agreement between Nigeria and Singapore?
(5 Marks)
State FIVE circumstances under which a company registered in Singapore will be liable to tax in Nigeria.
(5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Topic: Double Taxation Reliefs and Credits
Series: NOV 2022

AT – July 2023 – L3 – Q1b – International taxation

Calculating the tax payable for a resident company with cross-border income from Ghana and Nigeria.

Question

Libir Ltd is a resident company incorporated in Ghana. Its trading partners have been customers and suppliers from Ghana and also from Nigeria. The company supplies animal feed.

Its operation for 2021 year of assessment is as follows:
Income from Ghana: GH¢10,000,000
Income from Nigeria: ₦1,000,000,000

Additional information:

Allowable expense granted by the Ghana Revenue Authority is GH¢6,000,000.
The allowable expense in 1 does not include capital allowance of GH¢1,200,000 which was legitimately claimable by the company.
The tax paid in Nigeria amounted to ₦40,000,000. The withholding taxes paid in Ghana with evidence of tax credit certificates amounted to GH¢1,000,000.
The taxpayer has written to the Commissioner-General to relinquish its right under the double taxation arrangement.
Exchange rate is GH¢1 = ₦60.

Required:
Compute the tax payable.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Allowable expense, Cross-border income, Double Taxation, Tax computation
Level: Level 3

Topic: International taxation
Series: JULY 2023

Question Tag: Cross-border income

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AT – Nov 2022 – L3 – Q6 – Double Taxation Reliefs and Credits

AT – July 2023 – L3 – Q1b – International taxation

Calculating the tax payable for a resident company with cross-border income from Ghana and Nigeria.

AT – Nov 2022 – L3 – Q6 – Double Taxation Reliefs and Credits

AT – July 2023 – L3 – Q1b – International taxation

Calculating the tax payable for a resident company with cross-border income from Ghana and Nigeria.

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