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29gru2020

how to calculate assessable profit in nigeria

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Taxation of Petroleum Profits in Nigeria By Gloria Iroegunam This is a brief but concise overview of how petroleum profits are taxed in Nigeria as provided by the enabling law: the PETROLEUM PROFITS TAX ACT (PPTA) CAP P13 LFN 2004 and all references to the Act herein, shall be regarded accordingly. Assessable profit is the profits from all sources in the year immediately preceding the year of assessment. PETROLEUM PROFITS TAX (PPT) PPT is levied on the income of companies engaged in upstream petroleum operation. Capital gains tax administration in Nigeria is regulated by the capital Gains Tax Act Cap C!, LFN 2004. Note: Current Assets: Current Assets are those assets that are expected to be converted into cash or cash equivalents within one financial year. In this post, we take a quick look at the education tax in the country and what it entails. The Internal Revenue Service outlines four types of income categories. PROFITS (S.9 [1]) Non-Current Assets: Non-Current Assets are those assets that a company holds for more than one financial year, which are not readily convertible into cash or cash equivalents. You can decrease the amount of your assessable income that will be used for taxes by subtracting different tax writes-offs from that amount. The plus value of … However, there are different methods of calculating depreciation which […] The Nigeria Income Tax Calculator (NITC) shows in one click a summary of incomes, allowances, deductions and net income both monthly and annual. Education Tax in Nigeria: All You Need to Know. EDUCATION TAX (ET) ET is levied on all Nigeria companies’ assessable profits. Examples of Total Assets Formula (with Excel Template) Gross income is your total income from all sources. So this is the manner by which it works: Before you make sense of the amount of your pay you should provide for FIRS, you have to compute the measure of assessable salary. Difference Between Assessable Income & Taxable Income. How To Calculate: This tax is charged based on assessable profit at the rate of 2% only. Yet, in the event that you need to make sense of this, you should put forth a valiant effort and attempt to comprehend it. This means that all registered companies in Nigeria are required to pay a percentage of their assessable profit into an Education Tax Fund. ^^ You should simply have clicked on the link to find out more. The education tax is charged on all businesses registered in Nigeria in order to contribute to the educational development of the nation. Everything you need to know about personal income tax act in Nigeria All the non-resident companies in Nigeria are privileged to have a permanent establishment or fixed base in the country. It is only calculated when a company is computing its tax liabilities. It means that the profit is charged on profits for the accounting year, but in the year which precedes the assessment. The Calculator is a very simple application that helps to calculate tax due in line with the Nigerian Income Tax law. The tax is charged at 2%. The rate is 85% for Joint Ventures and 50% for Production Sharing Contracts (PSC). Your taxable income is the portion of your assessable income that is actually used to calculate how much you need to pay in income taxes. The rate of tax is 2% of Assessable profits. Conclusion These are the most important tax types in Nigeria. Capital Allowance is a claim against Assessable Profits by companies when computing their tax liabilities. ... That is, it does not form part of the assessable profit for the purpose of Education Tax calculation; You can also get in touch with us directly by filling the feedback form on … Taxable Amount - N592,925 5% of 1st 30,000 - 1,500 10% of next 30,000 - 3,000 This tax is remitted to the Education Tax Fund. 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