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July 5, 2022
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FCT-IRS Introduces Electronic Tax Clearance Certificate

The Federal Capital Territory Internal Revenue Service has introduced Electronic Tax Clearance Certificate (E-TCC) to check activities of fraudsters.

The Acting Executive Chairman of the Service, Mr Haruna Abdullahi disclosed this during his engagement with members of the House Committee on Public Accounts at the National Assembly in Abuja.

Abdullahi explained that the E-TCC had fortified the process thereby making it difficult for anyone to forge such document because of the security code.

He said this effort would help the Service not to be short-changed and boost revenue for the FCT.

The Acting Executive Chairman explained that Tax Clearance Certificate (TCC) is a document issued by the Tax Authority to certify that an individual or a business is compliant with the appropriate requirements as stated by law within a stipulated period of time usually for the three preceding years.

Abdullahi however quoted section 85 of the Personal Income Tax Act 2011 as amended, which states; that
“Whenever the relevant tax authority is of opinion that tax assessed on the income of a person for the three years immediately preceding the current year of assessment has been fully paid or that no tax is due on income or that the person is not liable to tax for any of those three years, it shall issue a tax clearance certificate to the person within two weeks of demand or give reasons for the denial”

According to him, while issuing a tax clearance certificate, due diligence must be carried out to ensure certain conditions were met by the taxpayers and satisfied by the tax authority.

He stated that application for TCC must be made and duly endorsed by the tax payer and annual income declaration form A and three years income declaration form must also be duly completed and signed by the taxpayer.

The FCT-IRS boss also noted that personal emoluments which comprises wages or salaries, including allowances, benefits in kind, gratuities, superannuation or pension schemes and any other income derived solely by reason of employment are declared.

Abdullahi added that income declared must be verified, satisfied and evidences of such income be sited while benefit in kind must also be verified based on section 4 of PITA 2011.

The Acting Chairman advised that taxpayers should always endeavour to declare their incomes accordingly with evidences that would be satisfactory to the managers of the tax authority while due diligence would be carried out appropriately within the stipulated time.

“It is evident that the issuance of the TCC is at the discretion of the Service in its justification based on the items listed in section 31 of FCT-IRS Act, 2015 and PITA, 2011 (as amended) may issue or not issue a tax clearance certificate” he concluded.

In his remarks, the Chairman House Committee on Public Accounts, Mr Oluwole Oke urged taxpayers to report any violation of the law concerning issuance of Tax Clearance Certificate to the management of FCT-IRS.

Mr Oke said FCT-IRS should consider the legislative arm as collaborator who would work to ensure smooth operations of the service.

“We will support you in whatever way to generate more revenue in the FCT, try to have record of all the people resident in Abuja, the data is important, ask for bank statements to know the actual tax to collect.

“We will support FCT-IRS and help the Service to bring more people to the tax net” Oke assured.

By Remi Johnson

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