Withholding Tax (WHT) – NBC Institute

TAX – May 2017 – L2 – SC – Q7 – Withholding Tax

Explanation of the peculiarities of withholding tax, rates for international transactions, and required particulars for a tax payment schedule.

Question

The recently employed Accounts Officer of Oriade Limited understands that the company must report Withholding Tax information to the Revenue Authority according to the provisions of the law. Being a fresh graduate, he does not know how Withholding Tax is reported to the Revenue Authority.

Required:

a. Explain the peculiarities of Withholding Tax. (3 Marks)

b. Where international transactions are involved:

i. State the rate of Withholding Tax. (1 Mark)
ii. List the types of income involved. (3 Marks)

c. Specify the currency of payment where the currency of the transaction is not in Naira. (3 Marks)

d. List FIVE particulars contained in the Withholding Tax Payment Schedule. (5 Marks)

Answer

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Tags: International Transactions, Payment Schedule, Tax Reporting, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: MAY 2017

TAX – Nov 2015 – L2 – Q5b – Companies Income Tax (CIT)

This question requires the computation of Adebola Nigeria Limited's tax liabilities and withholding tax payable for 2013 and 2014.

Question

Adebola Nigeria Limited has been trading for many years. The company makes up its accounts to 31 December annually. The extracts from its Statement of Comprehensive Income for the years ended 31 December 2013 and 2014 (as adjusted for tax purposes) are as follows:

Year ended 31 December	2014 (₦)	2013 (₦)
Profit for the year	14,000,000	10,000,000
Bank interest received (gross)	2,400,000	1,600,000
Debenture interest received (gross)	800,000	800,000
Dividend received from Adesemowo Ltd. (Net)	720,000	720,000
Dividend paid to shareholders (gross)	6,000,000	4,000,000

Required:
i. Compute the company’s tax liabilities for the relevant years of assessment. Ignore capital allowances. (5 Marks)
ii. Determine the net withholding tax payable or receivable by Adebola Nigeria Limited, arising from dividends paid and received by it. (4 Marks)

Answer

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Tags: Assessment, Corporate Taxation, Dividend income, Interest Income, Tax liabilities, Withholding Tax
Level: Level 2

Topic: Companies Income Tax (CIT), Withholding Tax (WHT)
Series: NOV 2015

TAX – Nov 2015 – L2 – Q5a – Withholding Tax (WHT)

This question involves highlighting the features of withholding tax and determining relevant tax authorities.

Question

i. Briefly highlight the main features of Withholding Tax.
ii. State the relevant tax authorities in relation to Withholding Tax in Nigeria.
iii. Enumerate the contents of a Payment Schedule for the remittance of Withholding Tax.

Answer

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Tags: Income Tax, Payment Schedule, Tax Authorities, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: NOV 2015

TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)

Identify the penalty rate per annum for failure to deduct or remit withholding tax.

Question

A person who is obliged to deduct withholding tax but fails to deduct, or having deducted, fails to remit on the due date, shall be guilty of an offence and liable to a penalty of _________ per annum of the tax withheld or not remitted, as the case may be:
A. 25%
B. 21%
C. 15%
D. 10%
E. 5%

Answer

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Tags: Nigerian Tax System, Non-compliance, WHT Penalty, Withholding Tax
Level: Level 1

Topic: Withholding Tax (WHT)
Series: NOV 2020

TAX – Nov 2020 – L1 – SA – Q9 – Withholding Tax (WHT)

Identify which type of income is not subject to withholding tax in Nigeria.

Question

Which of the following is NOT subject to withholding tax in Nigeria?
A. Salary
B. Commissions
C. Rent
D. Dividend
E. Professional fees

Answer

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Tags: Nigerian Tax System, WHT Applicability, Withholding Tax
Level: Level 1

Topic: Withholding Tax (WHT)
Series: NOV 2020

TAX – May 2022 – L2 – SA – Q5 – Withholding Tax (WHT)

Discuss the contents of withholding tax returns, the time frame for compliance, and the merits and demerits of the withholding tax scheme.

Question

Withholding tax is a tax deducted at source from proceeds made to a taxable person for the supply of goods and services. It is not another form of tax, but simply an advance payment of tax, as the withholding tax deducted at source is off-set against any subsequent tax liability that may be due in respect of the income.

Required:
a. State the contents of withholding tax returns/payment schedule. (5 Marks)
b. State the time frame for compliance with withholding tax returns. (5 Marks)
c. Explain the merits and demerits of the withholding tax scheme. (5 Marks)

Answer

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Tags: Compliance, Merits and Demerits, Tax Returns, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: MAY 2022

TAX – May 2019 – L2 – Q5 – Withholding Tax (WHT)

Calculate withholding tax credits, determine claim periods, and discuss compliance requirements.

Question

Oloriogun Logistics Limited renders consultancy services to newspaper publishing companies in Nigeria. All the publishers are limited liability companies which deduct appropriate withholding taxes from all consultancies and remit to relevant tax authorities within the time limit specified by the law. Oloriogun Logistics Limited makes up its accounts to December 31 each year and suffered withholding tax on the invoices raised for specific dates as follows:

Date of Remittance	Month of Transaction	Invoice Number	Amount (N)
19/2/2015	Jan. 2015	002/01	350,000
19/3/2015	Feb. 2015	003/02	670,000
20/4/2015	March 2015	004/03	810,000
20/5/2015	April 2015	005/04	305,000
19/6/2015	May 2015	006/05	295,000
20/8/2015	June 2015	008/07	922,000
21/9/2015	Aug. 2015	009/08	270,000
21/10/2015	Sept. 2015	010/09	195,000
20/11/2015	Oct. 2015	011/10	408,000
21/12/2015	Nov. 2015	012/11	495,000
21/01/2016	Dec. 2015	012/12	396,000
21/03/2016	Jan. & Feb. 2016	01/02	1,649,000

Withholding tax credit notes on the above invoices were forwarded to Diederik Logistics Limited, but the accountant was confused as to which year of assessment to claim these tax credits.

Required:
(a) Calculate the withholding tax credits for each of the above invoices. (6 Marks)
(b) Determine the total amount of withholding tax credits to be claimed for each year of assessment. (3 Marks)
(c) What is the due date for remitting withholding tax returns to the tax authority mentioned in (b) above? (1 Mark)
(d) State three transactions exempted from withholding tax in Nigeria. (3 Marks)
(e) List four distinct groups referred to as agents of the government for the collection and remittance of withholding tax in Nigeria. (2 Marks)

Answer

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Tags: Compliance, Exemptions, Tax Agents, Tax authority, Tax Credits, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: MAY 2019

TAX – Nov 2018 – L2 – SC – Q6a – Withholding Tax (WHT)

Explain the main features of withholding tax and the relevant tax authorities for WHT in Nigeria.

Question

Recently, the Federal Inland Revenue Service offices across the country embarked on a nationwide sensitisation programme. At a forum organised for this purpose in one of their offices in the South West zone, consultants were invited to present papers. As one of the tax consultants, you are required to explain:
(i) Three main features of withholding tax (3 Marks)
(ii) The relevant tax authorities in relation to withholding tax in Nigeria (3 Marks)

Answer

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Tags: Tax Authorities, WHT Features, WHT in Nigeria, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: NOV 2018

TAX – May 2017 – L2 – SC – Q7 – Withholding Tax

Explanation of the peculiarities of withholding tax, rates for international transactions, and required particulars for a tax payment schedule.

Question

Required:

a. Explain the peculiarities of Withholding Tax. (3 Marks)

b. Where international transactions are involved:

i. State the rate of Withholding Tax. (1 Mark)
ii. List the types of income involved. (3 Marks)

c. Specify the currency of payment where the currency of the transaction is not in Naira. (3 Marks)

d. List FIVE particulars contained in the Withholding Tax Payment Schedule. (5 Marks)

Answer

Find Related Questions by Tags, levels, etc.

Tags: International Transactions, Payment Schedule, Tax Reporting, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: MAY 2017

TAX – Nov 2015 – L2 – Q5b – Companies Income Tax (CIT)

This question requires the computation of Adebola Nigeria Limited's tax liabilities and withholding tax payable for 2013 and 2014.

Question

Year ended 31 December	2014 (₦)	2013 (₦)
Profit for the year	14,000,000	10,000,000
Bank interest received (gross)	2,400,000	1,600,000
Debenture interest received (gross)	800,000	800,000
Dividend received from Adesemowo Ltd. (Net)	720,000	720,000
Dividend paid to shareholders (gross)	6,000,000	4,000,000

Answer

Find Related Questions by Tags, levels, etc.

Tags: Assessment, Corporate Taxation, Dividend income, Interest Income, Tax liabilities, Withholding Tax
Level: Level 2

Topic: Companies Income Tax (CIT), Withholding Tax (WHT)
Series: NOV 2015

TAX – Nov 2015 – L2 – Q5a – Withholding Tax (WHT)

This question involves highlighting the features of withholding tax and determining relevant tax authorities.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Income Tax, Payment Schedule, Tax Authorities, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: NOV 2015

TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)

Identify the penalty rate per annum for failure to deduct or remit withholding tax.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Nigerian Tax System, Non-compliance, WHT Penalty, Withholding Tax
Level: Level 1

Topic: Withholding Tax (WHT)
Series: NOV 2020

TAX – Nov 2020 – L1 – SA – Q9 – Withholding Tax (WHT)

Identify which type of income is not subject to withholding tax in Nigeria.

Question

Which of the following is NOT subject to withholding tax in Nigeria?
A. Salary
B. Commissions
C. Rent
D. Dividend
E. Professional fees

Answer

Find Related Questions by Tags, levels, etc.

Tags: Nigerian Tax System, WHT Applicability, Withholding Tax
Level: Level 1

Topic: Withholding Tax (WHT)
Series: NOV 2020

TAX – May 2022 – L2 – SA – Q5 – Withholding Tax (WHT)

Discuss the contents of withholding tax returns, the time frame for compliance, and the merits and demerits of the withholding tax scheme.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Compliance, Merits and Demerits, Tax Returns, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: MAY 2022

TAX – May 2019 – L2 – Q5 – Withholding Tax (WHT)

Calculate withholding tax credits, determine claim periods, and discuss compliance requirements.

Question

Date of Remittance	Month of Transaction	Invoice Number	Amount (N)
19/2/2015	Jan. 2015	002/01	350,000
19/3/2015	Feb. 2015	003/02	670,000
20/4/2015	March 2015	004/03	810,000
20/5/2015	April 2015	005/04	305,000
19/6/2015	May 2015	006/05	295,000
20/8/2015	June 2015	008/07	922,000
21/9/2015	Aug. 2015	009/08	270,000
21/10/2015	Sept. 2015	010/09	195,000
20/11/2015	Oct. 2015	011/10	408,000
21/12/2015	Nov. 2015	012/11	495,000
21/01/2016	Dec. 2015	012/12	396,000
21/03/2016	Jan. & Feb. 2016	01/02	1,649,000

Withholding tax credit notes on the above invoices were forwarded to Diederik Logistics Limited, but the accountant was confused as to which year of assessment to claim these tax credits.

Answer

Find Related Questions by Tags, levels, etc.

Tags: Compliance, Exemptions, Tax Agents, Tax authority, Tax Credits, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: MAY 2019

TAX – Nov 2018 – L2 – SC – Q6a – Withholding Tax (WHT)

Explain the main features of withholding tax and the relevant tax authorities for WHT in Nigeria.

Question

Answer

Find Related Questions by Tags, levels, etc.

Tags: Tax Authorities, WHT Features, WHT in Nigeria, Withholding Tax
Level: Level 2

Topic: Withholding Tax (WHT)
Series: NOV 2018

Topic: Withholding Tax (WHT)

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TAX – May 2017 – L2 – SC – Q7 – Withholding Tax

Explanation of the peculiarities of withholding tax, rates for international transactions, and required particulars for a tax payment schedule.

Required:

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TAX – Nov 2015 – L2 – Q5b – Companies Income Tax (CIT)

This question requires the computation of Adebola Nigeria Limited's tax liabilities and withholding tax payable for 2013 and 2014.

You're reporting an error for "TAX – Nov 2015 – L2 – Q5b – Companies Income Tax (CIT)"

TAX – Nov 2015 – L2 – Q5a – Withholding Tax (WHT)

This question involves highlighting the features of withholding tax and determining relevant tax authorities.

You're reporting an error for "TAX – Nov 2015 – L2 – Q5a – Withholding Tax (WHT)"

TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)

Identify the penalty rate per annum for failure to deduct or remit withholding tax.

You're reporting an error for "TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)"

TAX – Nov 2020 – L1 – SA – Q9 – Withholding Tax (WHT)

Identify which type of income is not subject to withholding tax in Nigeria.

You're reporting an error for "TAX – Nov 2020 – L1 – SA – Q9 – Withholding Tax (WHT)"

TAX – May 2022 – L2 – SA – Q5 – Withholding Tax (WHT)

Discuss the contents of withholding tax returns, the time frame for compliance, and the merits and demerits of the withholding tax scheme.

You're reporting an error for "TAX – May 2022 – L2 – SA – Q5 – Withholding Tax (WHT)"

TAX – May 2019 – L2 – Q5 – Withholding Tax (WHT)

Calculate withholding tax credits, determine claim periods, and discuss compliance requirements.

You're reporting an error for "TAX – May 2019 – L2 – Q5 – Withholding Tax (WHT)"

TAX – Nov 2018 – L2 – SC – Q6a – Withholding Tax (WHT)

Explain the main features of withholding tax and the relevant tax authorities for WHT in Nigeria.

You're reporting an error for "TAX – Nov 2018 – L2 – SC – Q6a – Withholding Tax (WHT)"

TAX – May 2017 – L2 – SC – Q7 – Withholding Tax

Explanation of the peculiarities of withholding tax, rates for international transactions, and required particulars for a tax payment schedule.

Required:

You're reporting an error for "TAX – May 2017 – L2 – SC – Q7 – Withholding Tax"

TAX – Nov 2015 – L2 – Q5b – Companies Income Tax (CIT)

This question requires the computation of Adebola Nigeria Limited's tax liabilities and withholding tax payable for 2013 and 2014.

You're reporting an error for "TAX – Nov 2015 – L2 – Q5b – Companies Income Tax (CIT)"

TAX – Nov 2015 – L2 – Q5a – Withholding Tax (WHT)

This question involves highlighting the features of withholding tax and determining relevant tax authorities.

You're reporting an error for "TAX – Nov 2015 – L2 – Q5a – Withholding Tax (WHT)"

TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)

Identify the penalty rate per annum for failure to deduct or remit withholding tax.

You're reporting an error for "TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)"

TAX – Nov 2020 – L1 – SA – Q9 – Withholding Tax (WHT)

Identify which type of income is not subject to withholding tax in Nigeria.

You're reporting an error for "TAX – Nov 2020 – L1 – SA – Q9 – Withholding Tax (WHT)"

TAX – May 2022 – L2 – SA – Q5 – Withholding Tax (WHT)

Discuss the contents of withholding tax returns, the time frame for compliance, and the merits and demerits of the withholding tax scheme.

You're reporting an error for "TAX – May 2022 – L2 – SA – Q5 – Withholding Tax (WHT)"

TAX – May 2019 – L2 – Q5 – Withholding Tax (WHT)

Calculate withholding tax credits, determine claim periods, and discuss compliance requirements.

You're reporting an error for "TAX – May 2019 – L2 – Q5 – Withholding Tax (WHT)"

TAX – Nov 2018 – L2 – SC – Q6a – Withholding Tax (WHT)

Explain the main features of withholding tax and the relevant tax authorities for WHT in Nigeria.

You're reporting an error for "TAX – Nov 2018 – L2 – SC – Q6a – Withholding Tax (WHT)"

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