/ / / IMPLICATIONS OF NIGERIA’S VOLUNTARY ASSETS & INCOME DECLARATION SCHEME (VAIDS)

IMPLICATIONS OF NIGERIA’S VOLUNTARY ASSETS & INCOME DECLARATION SCHEME (VAIDS)

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Voluntary Assets and Income Declaration Scheme (VAIDS) is an initiative designed to encourage voluntary disclosure of previously undisclosed assets and income for the purpose of payment of all outstanding tax liabilities.

The VAIDS is an initiative of the Federal Government  in collaboration with tax authorities in Nigeria (both the FIRS and the IRS at all state levels) targeted at taxpayers, who had not declared their taxable incomes and assets, as well as those who don’t pay at all, and those who had been underpaying or under remitting in order to give a time limited opportunity for  them to regularize their tax status relating to past periods, in terms of REGISTRATION, RETURNS FILING, TAX ASSESSMENT and PAYMENTS of all taxes due.

The scheme is applicable to all taxable persons (Individuals & Companies) in Nigeria and it covers all federal and state taxes such as Company Income Tax (CIT), Personal Income Tax (PIT), Petroleum Profit Tax (PPT), Capital Gains Tax (CGT), Value Added Tax (VAT), Stamp Duties, Tertiary Education Tax (ET) and Technology Tax.

TARGET OBJECTIVES OF VAIDS

The VAIDS programme is aimed at;

  • Curbing tax evasion strategies in use by multi-national companies and high networth individual,
  • Using the current goodwill of the Government to tap into existing international networks to reduce loss of revenue,
  • Create more awareness on the statutory function of every citizen to pay tax.
  • Generating revenue and encouraging investment and economic activities
  • Improving tax compliance with the existing tax laws.
  • Reducing tax payers’ liability.
  • Granting taxpayers a window of opportunity to regularise their tax status without penalty.
  • Increasing the country’s non-oil tax to Gross Domestic Product ratio from 6 per cent to about 30 per cent

BENEFIT OF VAIDS

The VAIDS programme offers a lot of benefit to tax offenders. Usually, tax evaders when caught are liable to pay their tax plus 10 per cent of the total amount as penalty fee and 19 per cent as interest making a total of 29 percent. But if they take advantage of the VAIDS programme;

  • They will benefit from a waiver on interest and penalty on taxes due. (i.e. they stand to save 29 per cent on interest and penalty on taxes they owe).
  • They will no longer be investigated and will not be subjected to regular audit.
  • They will also not face criminal prosecution.
  • They will enjoy flexibility in payment of tax due.

The VAIDS programme offers a grace period of 9months from July 1, 2017 to March 31, 2018, for tax evaders to voluntarily pay back to government their tax due.

Whoever fails to take advantage of VAIDS, by the time the programme lapses, will then be liable to pay penalty, pay interest, face prosecution and open for further tax investigation.

All Tax payers are encouraged to use this opportunity to review and regularize their tax status.

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