Lagos Tax (any Tax Officer Inhouse Or Firs Staff) - Career - Nairaland
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| Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by ifsez: 12:32pm On Aug 13, 2009 |
Hi Landers, Is there anyone who works in the Tax office or who can throw more light on how tax in Lagos is done. A simpler way of Calculating it, so individuals can calculate it themselves. If you earn N50k for instance including all your allowance how do you calculate your tax and how much is your tax. If out of the 50k you earn, your basic salary is N25k and The other N25k is your allowance,Is the allowance left out and only the basic is taxed  What about small business owners?How are they taxed. Please help put some of us who are interested through. Thank you. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 12:17pm On Sep 21, 2012 |
Hello, the ideal thing is to let the relevant tax station help you out with the calculation after you file in your returns.You didnt state of the 50k is monthly of per annum. With the new tax law the allowance and reliefs has been modified into consolidated reliefs and allowance. If you total income in a year is 300k or less then you would be charged 1%. As regards small business owners, they would be charged based on preceding year basis income. You can send me an email doseni@yahoo.com, would put you through. I hope you find this information useful. Thanks |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 5:04pm On Sep 21, 2012 |
The info you give is not sufficient, because you just grossed up other allowances without stating the components, especially Housing and Transportation (if any). I will work on some assumptions in helping you. MY ASSUMPTIONS The 50k is gross per month, not net i.e Tax and Pension have not been deducted Your housing allowance is 10k, Transport 5k Basic - 25,000 Housing - 10,000 Transport - 5,000 Others - 10,000 GROSS EMOLUMENT: 50,000 Convert to annual figures Basic - 25,000*12 = 300,000 Housing - 10,000*12 = 120,000 Transport - 5,000*12 = 60,000 Others - 10,000*12 = 120,000 GROSS ANNUAL EMOLUMENT = 600,000 Less Reliefs & Allowances(Per Annum) 1, Consolidated Relief Allowance = 200,000 plus 20% of your Gross Income = 200,000+20% 0f 600,000 = 320,000 2, Pension = 7.5% of Basic,Housing & Transport = 7.5%*(480,000) = 36,000 Total Annual Relief(i.e Non-Taxable income) = 356,000 TAXABLE INCOME = GROSS PAY - NON-TAXABLE = 600,000-356,000 = 244,000 TAX 1st 300,000 taxable @ 7% = 7% * 244,000 = 17,080 per annum = 1,423.33 per month Tax per month = 1,423.33 Net pay per month = Gross pay - pension - tax = 50,000-3,000-1,423.33 = 45,576.67 *Don't forget my assumptions pls 1 Like |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by KiksAsso: 9:08am On Sep 22, 2012 |
@ Jarus! I really like your indepth analysis of the tax calculation. Pls I'm a bit confused about the below analysis for the actual tax deduction sent by the H.R Director of a friend working in a company; 300,000----------------7%----------------21,000 300,000----------------11%--------------33,000 500,000----------------15%--------------75,000 500,000----------------19%--------------95,000 1,600,000-------------21%--------------336,000 5,180,000-------------24%-------------1,243,800 How were the figures for the 3rd to 6th 500,000,----, 5,180,000 arrive at?. Again how do you apply it to someone with a taxable gross of N1,035,000PA?. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 11:46am On Sep 22, 2012 |
According to PITAM 2011, this is the new Tax Table First 300k of Taxable Income taxed @ 7% Next 300k @ 11% Next 500k @ 15% Next 500K @ 19% Next 1.6m @ 21% Excess of 3.2m @ 24% From the info you gave, your friend's Taxable income is 3,200,000 + 5,180,000 = 8,380,000. Taxed as follows 7%*300k 11%*300k 15%*500k 19%*500k 21%*1.6m The income taxed above equals 3.2m, yet he still has 5.18m left which is taxed at 24%(the rate for income in exxcess of 3.2m). For a taxable income of 1,035,000(Note: Taxable Gross means Pension and other reliefs have been removed) 300k*7%=21,000 300k*11%=33,000 Remainder 435,000 (less than 500k) taxed at 15% = 65,250 Total Tax = 119,250 |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Odunnu: 3:40pm On Sep 22, 2012 |
There's something I just learnt here Egbon. I've been taking 7.5 on total gross of our staff for pension. Nobody must know else i'j be stoned to death by angry 'mob'. Thanx. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 5:58pm On Sep 22, 2012 |
Odunnu: There's something I just learnt here Egbon.  Na 7.5% of Basic, Housing and Transport. The % can be higher than 7.5 as a matter of voluntary coy decision and staff consent, but it still has to be applied on BHT only. In any case, you've only helped them save for the future. The overstated pension still belongs to them, only that they can only access it in the future. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Gboliwe: 8:23pm On Sep 22, 2012 |
Quite an interesting thread. Please, how do you apportion or share the salary to basic, transport , housing and calls? I work in a small organisation and just toed the line of my predecessor in apportioning the figures. 2ndly, the majority of staff earn below N300K, should the tax still be 7% as stated above? |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 10:12pm On Sep 22, 2012 |
Gboliwe: Quite an interesting thread. Please, how do you apportion or share the salary to basic, transport , housing and calls?If the pay package is not broken into its various elements - at least basic, housing and transport - it becomes quite difficult to compute the pension and taxes. The mgt or your HR would do better breaking down the staff package package in this for proper tax accounting. However, if they are not broken down, applying 7.5% on total income as Pension is not out of place,but you would have overstated the Pension, which is better than understating. Also, for Tax, the new amended PITA makes it easy. CRA applies to the Gross Income. So you won't have problem computing the CRA, but the tax man, in time of audit, may not accept taking as relief Pension based on 7.5% of total income and not BHT only, but if you show evidence of pension remittance and all that, they can accept it. For an annual income of 300k and below, clearly 7% is the applicable rate. It is when it crosses 300k that the excess will be subject to 11%. But I hope the 300k you're talking about is not monthly because we are talking about annual figures here. 300k per month comes to 3.6m per annum. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Gboliwe: 10:28pm On Sep 22, 2012 |
Thank you Mr Jarus. Like I mentioned, its a small organisation, we dont have a HR dept. Your explanations are indepth. I am grateful. N300K is pa, that I understand. Thank you once again |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by oluseg2: 12:57pm On Sep 23, 2012 |
Thanks Jarus. Your analysis is quite indepth. I appreciate. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by upengineer: 6:15pm On Sep 23, 2012 |
How do i compute my TOTAL EMMONULMENT. My offer states my basic salary, housing, medical, overtime, and other allowances. Are allowances computed with TOTAL EMONULMENT? |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by oneblacboi: 8:09pm On Sep 23, 2012 |
Hey guys, download the attached tax calculator
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| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Gboliwe: 9:14am On Sep 24, 2012 |
I downloaded the PIT calculator you uploaded on NL and I'm blown! Big relief for a green horn like me. Thank you Sir. I just want to ask how to apportion the basic, housing, transport and other allowances. Is it a random apportioning or there is a strict rule to this? Since the basic salary is of this importance, how do I as an accountant help my colleagues in reducing their tax? that's why I need to understand the makings of this apportioning. I will ask this same question on that thread just want to know the best way to go about it. Thank you for ur time, I am grateful |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by sharpman1(m): 9:31am On Sep 24, 2012 |
Odunnu: There's something I just learnt here Egbon. Apparently you have also made the the company incur more pension cost as the company is meant to also contribute the same amount (7.5%) deducted from the staff as the employers portion of the contribution. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 4:00pm On Sep 24, 2012 |
upengineer: How do i compute my TOTAL EMMONULMENT. My offer states my basic salary, housing, medical, overtime, and other allowances. Are allowances computed with TOTAL EMONULMENT?Yeah, all the allowances are part of your total emolument. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Nobody: 4:45pm On Sep 24, 2012 |
Gboliwe: I downloaded the PIT calculator you uploaded on NL and I'm blown! Big relief for a green horn like me. Thank you Sir.The apportiniong is an internal policy and should be reflected on their offer letter or contract review letter. It is hard now to plan the reliefs. The CRA is 200k plus 20% of Gross Emoluments. So clearly, it is dependent on total pay, the higher the pay, the higher the relief in absolute terms. However, if you load Basic, Housing and Transport more, your pension will be high and pension being tax-deductible, means you have more relief and less tax. But then, what you gained in tax reduction, you 'lose' as huge pension deduction(although it is still your money - only being saved for future), meaning there may not be much difference in net pay. let's consider this simple scenario for someone earning 6m thus: Basic - 3m Housing - 1m Transport - 0.5m Others - 1.5m TOTAL - 6M CRA = 200K + 20% (GROSS) = 200K + 1.2M = 1.4M PENSION = 7.5% * 4.5M = 337, 500 TOTAL RELIEFS = 1.7375M TAXABLE INCOME = 6-1.7375 = 4.2625M TAX =(7%*300K)+(11%*300K)+(15%*500K)+(15%*500K)+(19%*1.6M)+(24%*1.062M) = 0.815M BALANCE IN PENSION A/C = 0.3375M NET PAY = GROSS - PENSION - TAX = 6M-0.3375-.815M = 4.8475M Now, if the Gross pay is restructured(apportioned) with less load in BHT Basic - 2m Housing - 0.75m Transport - 0.25m Others - 3m TOTAL - 6M i.e same income, different structure We have: CRA = 200K + 20% (GROSS) = 200K + 1.2M = 1.4M (wont change, cos it's dependent on Gross pay) PENSION = 7.5% * 3M = 0.225m TOTAL RELIEFS = 1.625M TAXABLE INCOME: 6M-1.625M = 4.375M TAX =(7%*300K)+(11%*300K)+(15%*500K)+(15%*500K)+(19%*1.6M)+(24%*1.175M) = 0.842M NET PAY = GROSS - PENSION - TAX = 6M-0.225M-0.842M = 4.933M BALANCE IN PENSION A/C = 0.225M For same total income, when the BHT is loaded, he has less tax(caused by more pension relief), less net pay (chopped by pension deduction) but huger balance in his pension a/c (his future income). Vice versa, when BHT is not packed and 'other allowances' loaded. You may have to do some comparison in percentages before arriving at what option to settle for. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by oneblacboi: 6:49pm On Sep 24, 2012 |
Pension is 7.5% of Basic, Housing & Transport (BHT). It is also to be matched with 7.5% by the employer. Your colleagues should actually thank you for getting them more for their retirement. Odunnu: There's something I just learnt here Egbon. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by cheiwura: 8:25pm On Dec 18, 2013 |
Jarus: Thanks Jarus. Kindly attend to this. I want to know the tax liability implication of those earning below N300k p.a. How would they benefit from CRA ? For instance, an employee who earns 15k per month as total emolument (basic- 7.5k, housg - 3k, tranport -2k, others 2.5k), annual= 180k. How do u arrive at his payable tax ? Mindful of the fact that his total annual pay is below 200k! Urgent attention would be appreciated. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Ayomidedeji: 11:55pm On Dec 18, 2013 |
please can anyone help with the address of the nearest tax office to iyana ipaja |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by biznus: 10:38am On Aug 10, 2016 |
cheiwura:Minimum Tax provision of 1% is charged on the Gross Income if after granting the Consolidated Relief Allowance (CRA) plus 20% of the Gross Income, there is no tax payable or the tax payable is less than 1% of the Gross Income, then the minimum tax will apply. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Deshalom(m): 12:01am On Mar 02, 2017 |
Hi Guys, I really need ur help. I have been told to do a tax gross up calculation for over 100 contract staffs. They earn 15,000 each and the company pays 150 naira as tax on their behalf. Now the company intend to gross up the employee gross by the tax value so the net remains 15,000. Pls how do I proceed? Can anyone help with a calculator for the gross up. All input will be appreciated. |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by equity2602: 12:22pm On Mar 02, 2017 |
Deshalom: |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by Scholar8200(m): 9:03am On Mar 03, 2017 |
Deshalom:Very simple, the value is 15,150 x 100 = 1,515,000 Gross Salary 15,150 Less Tax 150 Net Pay 15,000 or 15,000 /.99 = 15,151.51 approx = 15,150 (.99 is 1-.01) The casual staff earn 15k per month hence your company pays minimum tax per person at the rate of 1% (.01). |
| Re: Lagos Tax (any Tax Officer Inhouse Or Firs Staff) by profstar(m): 8:23am On Mar 22, 2017 |
Gboliwe:Good day sir, I believe you were able to get an answer to this question. Can you share if you don't mind as I'm in your exact shoe at this point of your work life Sir, I understand it is apportioned based on company policy but what is the general percentage for apportioning when such is not in place. Thank you in anticipation of a reply. |
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