E tire me o. Even after acquiring wealth from the devil they will tell you, na god do am.

yeyerolling:
Nigerians go dey fornicate still dey call God hahahah

mrphysics:
The truth is that VAT is one of the most complicated tax to calculate. In reality, VAT isn't as straight forward as its been said here except for those that render single services. For now, FiRS just want you to pay for tax. Only few countries has automated their VAT payment due to the complexities involved in the automation of VAT. I studied Malaysia' GST Automation in bid to know how FiRS can automate their VAT collections, it turned out it's not a project one should go into currently as many things are involved.


I enjoy researching and automating government tax types however, my solutions has been devoid of VAT as VAT must be collected at the point of consumption.

Nice one OP

Most accountants, myself inclusive find VAT to be the easiest to compute. It's pretty straight forward. I don't know how you came about that.

Thank you.

Olayinka777:
Beautiful! This is the best business tips I have read so far.

Thanks.

chidekings:
Quite a good read.

18. Always try to exceed customer satisfaction by offering them more than what they desire. When you do utilize this tactic, make sure you do communicate to them that it’s an added service. It will evoke a positive emotional connection with your brand. The customer will also be aware that you went the extra mile to make their experience a splendid one.

19. Maintain a high level of courtesy in all your dealings with customers. Imbibe the same culture in your employees.

20. Never compromise integrity. Your success or failure will depend on the reputation you create for your business. Let your customers know you for your credibility.

21. Welcome customer complaints. Resolve them promptly, with integrity and efficiency and put adequate measures in place to prevent recurrence.

22. Invite your customers to make suggestions on how you can serve them better. Implement the improvements they suggest if they are feasible. Listening to your customers’ recommendation makes you feel valued. You will also be in a best position to give them exactly what they want, not what you think they want.

23. Make your business reachable to customers in the ways that is convenient for them to reach you. You can achieve this by featuring your email address, mobile numbers and address on every of your promotional materials and other business documents.

24. Listen to your employees. Nobody knows their jobs better than your staff. They see all the problems and issues on a daily basis. Chances are, they also know the best ways to solve them too. Ask your staff what the biggest issues are and get their ideas on how to solve them. Not only will you make your employees happy by seeking their opinions, you will also get some brilliant cost-saving ideas too.

25. Decentralize Your Internet Presence: In the 90s, your “Website” and your “internet presence” were basically synonymous. Today, they’re not. If you’re on a tight budget like most entrepreneurs are, consider paying less attention to your website and focusing more on the rest of the web online. Customers today are all about relationship marketing because they want to do business with people they know and trust and the best way to create that relationship is to go to the places they are and those places are Facebook, Twitter, LinkedIn, Nairaland and other online social forum. Establish your business presence on these sites.

Question: Besides your main site, how else can you establish a cost-effective internet presence?

26. List everything your competitors have in common…then do the opposite: Too often, businesses get wrapped up in only competing on the same items as their competitors. They want a website that is similar but better, products with the same features done better, etc. In order to distinguish yourself and standout among your competitors, try your hand at writing out everything that they actually do, then spend a little more time thinking of the exact opposite of them. Do they use a lot of black in their imaging? Use white in yours! Not only will you get noticed for being you, but you’ll appear in front of a whole new set of eyes. People easily get tired of similarities.

Question: What are some things that your competitors do that you can do differently?

27. Get Emotional. As much as we’d like to think that our decisions are rational and logical, they’re also driven by fears, aspirations, gut instincts, a desire for affiliation, and a medley of other emotional promptings. Skip the rational arguments, and appeal to those hard-to-reach emotions instead. It will give you a stronger personal connection, and set you apart from your competitors.

Question: What are your customers’ emotional needs? What can you do to satisfy them?

28. Let your business standout from the competition. To achieve this, the first thing I’ll need you to do is to work on the outlook of your shop. Paint your shop using attractive colors. Also enhance the visibility of your business by placing an outdoor signage. It is an effective marketing tool in the sense that it attracts the attention of potential customers. Get a graphic designer to design an attractive and stylish signage for your business. The signage should contain a light source (bulb or fluorescent lamp) to make it visible at night. Also consider placing a small sign at the street entrance.

29. Get in early. A potential customer shopping around may visit about ten other websites (or stores or offices…) before making a decision. As typical of every businessman/woman, you would put on a good show and hope they eventually come back to buy, but there are often ways you can connect with customers, even before they make a choice, so you can build a relationship and follow-up when your competitors can’t.

Example is a free download of vital information upon entering their email address-you give them something to remember you by, but retain theircontact information for follow up.

Question: What real value can you give your potential customers in exchange for their contact information?

30. Say something nobody else will. Every industry has norms about the content in sales materials, and it’s often the case that businesses imitate one another instead of thinking about what customers really want to know.

Question: What information would your customers love to have that most of your competitors don’t talk about openly?

31. Aim for a different target market than your competitors. There are always other tribes of individuals who are just dying to hear about your product or service. They may be a bit smaller than your main market, but you should start thinking of the possibilities of targeting a smaller niche. The niche is out there. All that is required of you is to discover creative ways of reaching them. Question: What are some different markets that you can target that your competitors don’t already reach?

32. Maintain proper records of all your transactions. Many small business owners view financial record-keeping as a waste of time. Proper accounting records provide information that would assist in making business decision. A small retail business without adequate internal control system and record-keeping stands the risks of being ruined by dubious employees. Keep proper records of inventories, sales, purchases, cash etc.

33. Maintain personal relationship with your customers. We are in the era of relationship marketing. Customers are more confident to purchase goods from someone they are familiar with. Every business that wants to succeed must create and nurture meaningful personal relationships with customers.

34. Don’t create a product and start looking for a problem that it will solve. A lot of people are guilty of this. They create a product and start looking for a market for it. Following this approach is the first step to business failure. Instead, scan your environment for problems and then go ahead and create a product (good or service) that can solve the identified problem. In that case, you won’t have to struggle to sell your product because you are meeting an already existing need.

35. And finally, the most important of them, Choose a good location for your business. The location of your business can make or mar it. If you have not already decided on a location for your business, ensure to choose a location that makes you visible to your prospective customers. Choose a location with a lot of traffic. Like I always tell my clients, the three most important factors to be considered in business are location, location and location. Get your location right and your problems will be half solved.

I hope it was helpful?

SOURCE: Accounting Wizards’ Blog

cc: Mynd44, Dominique, Lalasticlala

This article is a collection of some of the best advice I’ve given to my students and clients. It features actionable tips and strategies that can be implemented by business owners and entrepreneurs to launch, manage and grow their businesses successfully. It covers a wide range of issues including branding, customer service, customer relationship management, employee motivation, advertising, marketing, competition and many more.

Implementing just one out of the several tips I will be sharing will yield significant positive results in your business. How much more if you’re able to implement all?

This article is an invaluable resource to every business owner or prospective business owner. It will save you hundreds of thousands of naira you would have paid to consultants. You are free to share with your friends and relatives.

Here are 35 Highly Effective Tips For Business Owners:

1. Define your brand. No two businesses are alike just as no two customers are. Hence, there is need for you to brand your business. What does your business stand for? What differentiates your business from other businesses in your industry? What do you want to be known for in the market place? What is that special thing about your business? No one business can appeal to everybody. So your best response is to define your brand and consistently communicate and promote your Unique Selling proposition(USP), the unique qualities that differentiate your products from the multitude and compelling reason customers will patronize you instead of your rival. Your goal is to be different and better than your competitors, and the first step to achieving that is to ask yourself – What does my business stand for? What do I want my business to be known for? And What picture do I want to create in the minds of my customers and the general public?

2. Target the right people. If you try to advertise to everybody, you will end up targeting nobody. Your first step in improving your marketing effectiveness is to identify a group which has the greatest need for your product. Having identified your niche, you need to grab their attention by highlighting what is beneficial and important about your product in all your campaign. Customize your promotional materials and advertising campaign to appeal to their greatest needs and focus your marketing efforts towards your target customers. When you target prospects with the greatest need for your products, your marketing efforts will produce the best result at the lowest cost.

3. Launch your business by hosting a Grand Opening Event. If you are not working on a tight budget, you may consider marking the establishment of your business with a grand opening ceremony in which prospective targets will be invited to grace the occasion. This will give your target an avenue to learn about your products and business and will give you the opportunity to showcase samples and demonstrate how they help your targets to solve problems. At the event, you should create a register to collect the names, contact information and other important details of participants for the purpose of reaching them with periodic reminders about your products. You should also provide them with promotional materials. The only reason they’ll not patronize you subsequently, is if your product does not add value to them.

4. Let your business stand for something. Otherwise, it will fall for anything. To remain competitive, you have got to be distinctive. You must revisit your reason for being in business and make it one greater than just making profit. If there is nothing peculiar and unusual about your business and how it relates to meeting the needs and solving the problems of the market, then you have no reason being in business. Focus on the value you will be delivering to your customers first and keep improving on that, money comes naturally, because people will only keep paying for what they consider valuable. Offer your customers something special, a value, a benefit they cannot get from your competitors, such that they will have a second thought about patronizing your competitors.

5. Choose a competitive advantage for your business. There are basically three key areas available to you to focus on when choosing a competitive advantage:

Quality: You can choose to beat the competition by offering a superior quality than others.

Price: You can choose to beat the competition by offering the lowest price in your industry.

Service: Or you can choose to beat the competition by offering an unforgettable customer service.

The first two forms of competitive advantage will cost you a lot and often time, customers can choose otherwise. There is always an alternative to quality; if you focus on only offering the highest quality, at a premium price, customers will scout around for lower quality at a cheaper price. There is always an alternative to price; if you focus on offering the cheapest price possible, it will require that you drive down your costs to the barest minimum. And this may result in low quality products and customers will begin to complain.

My recommendation is that you select either of the two; price or quality as your competitive advantage and complement it with service. Without the element of service in your competitive strategy, the customers cannot be satisfied. People may not remember how great your product is (quality): They may not remember how much you made them pay (price), but they will never forget how you made them feel (service).

6. Create a customer database for your business. Your customers are the lifeblood of your business. The more you know about them, the better chance you have of providing products and services to them that they actually want to buy. Research has shown that it costs 20 times more to get a new customer than it costs to maintain older customers. Customers are very expensive to attract that is the reason your business needs to focus on a Customer’s Lifetime Profitability (CLP) rather than on a one-off purchase. Your business should place more emphasis on building an enduring relationship with customers rather than making a new sale. Your customer database is your best marketing tool. Along with the name and contact of your customers, your customer database should include products purchased and date of purchase. You can then use this information to target your advertising and marketing strategies by reaching them again with periodic reminders and offers.

7. Focus on what your customers really want. Your customers really don’t want your products or services. They don’t even want what those products or services do for them. What they want is to derive the specific satisfaction they desire after buying and using your products or services. Keep this in mind when designing your web pages, sales letters, fliers and other promotional materials. Emphasize the feelings produced by using your product instead of talking about what your product is or how it works. Convert the benefits delivered by your product or service into clear word pictures. Then put your prospects in the picture by dramatizing what it feels like to enjoy those benefits.

8. Keep communicating with your prospects. Most prospective customers will not buy the first time they see or hear about your product. You’re losing a lot of sales if you do not persistently follow up with those prospects. You cannot follow up with prospects if you do not know how to reach them. You must set up a system for collecting the names and contact information of all prospects that make inquiries about your products or services but do not buy from you, for the purpose of reaching them with periodic reminders about your products.

9. Make sure that you and your employees have an in-depth knowledge of your products. Prospective customers make inquiries before deciding whether or not to purchase a product and you should be able to provide them with every information they require, pertaining to your products and/ or business.

10. Visit your past customers: Call them or have them called by your staff. See how they are doing. Ask them why they have not done business with you recently (this is a very valuable method to understand the customer’s perspective of your business). If there are any issues preventing them from patronizing your business, resolve them immediately. If not, engage the customer and get the relationship back on track. This is one of the reasons you should maintain a customer database.

11. Try to increase the number of time customers spend at your office. You can achieve this by making your office as tidy and attractive as possible and by playing informative and entertaining videos.

12. Ask for testimonials from existing customers. Good testimonials are perfect for your web pages and promotional items. Don’t just collect testimonials and keep them lying idle. Feature them in everything you do-website, advertising, handouts, fliers etc.

13. Make use of referrals: Employ referral marketing techniques by encouraging, informing, promoting and rewarding customers and contacts to think and talk as much as possible about your products, business and the value and benefits they derived. There are only three reasons a customer will want give referral to your
business:

A. He wants to help you.

B. He wants to help the person he is referring.

C. He wants to help himself.

To get more referrals, you must encourage these motivations and make it EASY to refer you. Customers will only refer their friends and relatives to businesses they know, love and trust. I recommend you employ the following techniques:

Incentives: A gift, a commission or a discount, can all work as incentives for customers to help themselves. Adding an incentive alone is not generally sufficient, since whatever you offer is unlikely to make up for the possible risk involved. Think of incentives more as the carrot to push a referrer from ‘thinking about referring you’ to ‘actually referring you’. If you do offer incentives, it is important to do it with tact and care. This is because you don’t want your customers to feel you are trying to buy them and neither do you want their referrals to think they were referred for some other reason than for your awesome products and services.

Ask and you shall receive: Don’t be shy, come out and solicit referrals from satisfied customers. If you don’t like asking in person, then, send an SMS to your customers to tell someone about your business. They will be happy to do that.

Provide them with the tools they need: Ensuring your referrers have an easy point of contact-whether it’s a website, a Facebook page or just a business card to give out means you are removing one more obstacle to getting those referrals. And of course, make sure that the phone gets answered, emails get responses and you follow up on those referral leads. Don’t let them go to waste or you are unlikely to get referred again by that person. (Note: A large number of satisfied customers telling the world about your business is much more effective than any amount of advertising you can pay for).

14. Ensure that your employees are happy at all times. An unhappy and unmotivated staff cannot provide a desirable customer service. Hence, it is recommended that you regularly conduct an employee attitude survey to measure and improve employee satisfaction. This will have a positive impact on the way they attend to customers.

15. Attend to your customers promptly. Customers do not like waiting so do not delay in attending to them. If there is any reason not to meet-up in this regard, make them understand the circumstances. Apologize and assure them that it will not repeat itself in the future. If you don’t do this, you may lose your important customers.

16. Treat your customers well at all time! Regardless of your mood, you have to always greet your customers with a smile and implore your staff to do same. A genuine smile and honest conversation keeps your customers coming back to you. Give your customers undivided attention. That personal touch and genuine interest in them will speak volumes-not only in the amount of referrals you will get from them, but also in your profit.

17. Provide customer service training to your employees on a regular basis. The advantages that come will these are numerous, your business will enjoy more patronage, sales, referrals, to mention but a few, as a result of the improved customer service they receive from your employees.

SOURCE: Accounting Wizards’ Blog

I disagree. The reason it looks as if there's improvement is, the APC government is preventing the press from reporting the real situation on ground. Another thing you should know, BH is still in control of some territories. Ask any soldier in the war theater if you're in doubt. Everyday soldiers get killed in their scores and hundreds. If it continues at this rate, I fear a time will there'll be nobody left to fight the BH.

godox2:
I disagree with you,
Before 2015., Nigeria was in a more bigger pronlem than now,
Parts of territories were taken over by BH
Politicians steal without fear
Herdsmen cousing havoc in Benue, Nassarawa, Taraba Kaduna and plateau.
There was a rumour that Nigeria will break
Infact, people were running, leaving the country, but the challenge we have now is fair,
The elites are the ones pushing us to war, this is because most of them are hungry, For instance, NOI said almost 20bn was given to NASS, before passing 2015 budget, we dont know of previous years. On assumption of duty, Kemi was strict professionally, that stop bribing them before they pass the budget, there many leakages that Kemi blocked and it is affecting them. Buhari or GEJ, answer presidents but they hire professionals to do the jobs.

Thank you for the correction.

nams77:
Nice post but op, Econet (Airtel) was the first GSM company in Nigeria. It was launched in August 9th 2001( that's if my memory serves me right)

I just checked now and discovered it was actually 6th August 2001. Econet was definitely the first

This write-up was prepared as part of a lecture I delivered on entrepreneurship some years ago. I hope you will find it helpful. Please try and do the assignment given. Who knows? You may come-up with the next big thing like Facebook, Google and our own Hotels.ng. Have a wonderful read!

Business opportunities are everywhere but are usually in disguise, So you can only notice them when you pay close attention to the world around you and the people living in it. Today’s lecture will help you understand what business opportunities are and how to identify them.

I would like to explain the concept of business opportunity by looking at the definition of marketing. Marketing is not the same as advertising. It is a much broader concept. Unlike advertising, marketing starts even before the product is created.

Marketing is the process of identifying a need in the market, designing a product (good or service) capable of solving the identified need; pricing, promoting and distributing the product to the target customers through various channels. The underlined word “need” is the business opportunity we are talking about here. Businesses start having difficulties when they try to do things the other way round – i.e. creating a product and start looking for problems that the product can solve.

For an idea to qualify as a business opportunity, there must be four elements present, viz: a need, a means to fulfill the need, a method of applying the means to fulfill the need and a method to benefit the provider of the means (the provider of the means is the entrepreneur). In order words, for a need to qualify as a business opportunity, there must be a good or service that can satisfy that need, and the person providing the product should be able to enjoy financial reward for his efforts.

The key to identifying viable business opportunities is to focus on people’s pains and frustrations. In that way, they will be left with no choice other than paying you, if you are able to come up with a solution. Take yourself as an example. What are those products you need that are not readily available to you? Or the product is available but of poor quality or the process of accessing it is time consuming or inconveniencing. If others are experiencing the same problem, then you’ve just found a good business opportunity. The next issue would be that of having the resources, capability and most importantly the guts to solve the problem.

There are several ways of finding business opportunities. But in order not to confuse you, we’ll be looking at only three:

1. Identifying unmet customer needs. A customer need is unmet when it is important to the customer, but he/she is not satisfied with the solutions currently available or the solution is not available at all. The more important the need and the less satisfied the customer is, the greater the business opportunity.

Most successful businesses have capitalized on the pains, struggles and challenges of people. They were able to achieve success by identifying what the problems were and proffering solutions to them. Since you may not have the funds to hire a market research firm to survey the market, the best option available to you is to sample peoples opinion. Talk to friends and family members to find out what their problems, needs or challenges are. The internet is also a good source to discover what goods and services people are looking for.

Let me share with you how I came up with the idea of a CV writing business I established two years ago. In 2011, a friend approached me to help him write a CV and cover letter. According to him, he has submitted applications to over 20 companies without hearing a word from them. As at then, I did not even have a CV myself. I scrutinized his CV but couldn’t see any reason he wasn’t getting interviews. So, I sacrificed a couple of hours of my time to do a little research on the current trends in CV, Resume and cover letter writing. That was when my eyes were opened to the mistakes on his CV. I restructured his CV and to my surprise, He was invited for an interview within a month.

Few months later, when I went to the cyber café, before my very eyes, a young lady paid three thousand naira to one of the attendants to help her prepare a CV. In my curiosity, I waited to see the finished results, and it was not even as good as what I wrote for my friend for FREE. I then asked the attendant how often he gets to write CVs for people, and he said, “Almost every day. When business is good, I even write up to three in one day.” That was when it occurred to me that I could make good money by offering the same service. Prior to this incident, I never knew people paid money to get their CV written. The rest is history. Today my CV writing service is recognized as a leader in the CV writing industry in Nigeria.

2. Identifying inefficiencies in an existing product or service. You can also source for business opportunities by looking out for good ideas that have not been effectively executed. People value quality products. They also like speedy delivery and convenience. So, If you are able to improve on the quality of an existing product or the process of delivering the product to the customers, you may be in business soon.

3. Import an existing product or service into an untapped market. Lookout for products that were successful in a different geographical location. Maybe you’ve traveled to a different city or town and seen a product (good or service) that is selling very well and is not being offered where you live. You can do some research to see how you can successfully introduce it as something “new” in your area.

Business opportunities come and go. Just like time, they wait for no one. If you want to be a successful entrepreneur, you should always lookout for problems experienced by people or businesses. When you finally spot one you have the resources to solve, don’t hesitate to take advantage of the opportunity immediately. Otherwise, someone else will do it.

ASSIGNMENT:

1. List ten companies and identify the type of opportunity they leveraged upon to break into the Nigerian market.

Hint: introduced an entirely new product into a new market, improved an existing product or introduced an existing product into an untapped market

Also explain briefly.

Example:

MTN – introduced an entirely new product into a new market. MTN was the first company to introduce mobile communication a.k.a. GSM into the Nigerian market.

2. Pick any town or city of your choice. Identify at least five (05) major problems affecting the residents of the town or city. Are you sure these people are willing to pay for a solution? Which of these problems do you have the resources to solve? Why do you think you will succeed? What threats are you likely to face in this business and what measures will you put in place to minimize their effects on your business?

Submit your answers here. Have a wonderful Day!

SOURCE: Accounting Wizards’ Blog

[

That's exactly what we need at the moment, but trust me, it will never happen.

suyamasta:
When the Govt Is doing anyhow with your money you tend to lose hope in paying tax, walaii

True.

BeingFrank:
Tax is a scam, you end up paying tips to some con men in government. Ask Buhari. All the same, op, ur post is really informative.

You're not far from the truth, no thanks to our corrupt leaders. I pray we get delivered someday.

INTRODUCTION

A Value Added Tax is a type of consumption tax levied on products at every point of sale where value has been added to the product. It starts from the raw material stage to the point of sale where it is bought by the final consumer.

Consumption tax is simply defined as a tax levied on the purchase of goods and services. Every seller in the production chain charges a VAT to the buyer, which is then remitted to the government. The amount of VAT levied at each point of sale along the production chain is based on the value added by the seller.

This is provided for by the Value Added Tax Decree 102 of 1993 which actually became effective in 1994. Value Added Tax is charged 5% on all VATable goods and services. The VAT decree requires manufacturers, wholesalers, importers and suppliers of VATable goods and services to be registered within six months of commencement of business. VAT is administered by the Federal Inland Revenue Services (FIRS) through its VAT directorate with offices in almost all the local government areas in the country.

Who are those that should pay VAT?

A VATable person is one that deals in VATable goods and services. Examples of such include:

• A limited liability company e.g. Tunde Limited
• A firm e.g. Law & Co.
• A sole trader e.g. Emeka & Brothers
• An individual e.g. Lawal shops
• A Club or society e.g. Gbaja Social Club

When you register and become a VAT payer, 5% of the money your customers pay for your goods and services is calculated as your OUTPUT VAT.

On the other hand, when you purchase any goods and services, 5% of the money you pay is calculated as your INPUT VAT.

To calculate the amount that goes to the government, you have to subtract your INPUT VAT from the OUTPUT VAT.

That Is; Total VAT payable to the government = Output VAT – Input VAT

Calculating VAT

E.g. 1

In 2001, a phone manufacturer sold a phone to a final consumer for N250,000. The raw materials for this phone was bought at N100,000. Find the:

(i) Output VAT
(ii) Input VAT
(iii) Total VAT payable to the government

Solution

Output VAT = The 5%VAT you charge on goods and services you supply or sell.

Input VAT = The 5% VAT you pay on goods and services that you use.

Since the manufacturer of the product sold the product for N250,000, the 5% of the 250,000 Naira is the output VAT. (This is constant because we assume that 5% VAT is always added on every goods and services sold).

Output VAT = 5% of 250,000 Naira

Output VAT = 12,500 Naira.

While…

Since the manufacturer spent 100,000 Naira to buy the raw materials, 5% of that amount is called the input VAT.

Input VAT = 5% of 100,000 Naira

Input VAT = 5000 Naira.

The total VAT payable = Output VAT – Input VAT

Total VAT payable = 12,500 – 5000

Total VAT payable = 7500 Naira.

E.g. 2

In April 2018, Mr Jide bought goods for N200,000 and sold same for N400,000. Calculate the total VAT he should pay for the month of April.

Solution

Output VAT = 5% of his sales

Output VAT = 5% of 400,000 Naira

Output VAT = 20,000 Naira.

While…

Input VAT = 5% of inventory purchase

Input VAT = 5% of 200,000 Naira

Input VAT = 10,000 Naira.

Therefore…

Total VAT payable for the month of April is;

Output VAT – Input VAT

Total VAT Payable

= 20,000 – 10,000

= 10,000 Naira

This amount is payable where the output tax exceeds the input tax. In a situation where the input tax exceeds the output tax, the deficit can be claimed by refund.

There are three ways to claim your refund:

1. The credit method
2. Direct cash refund method and
3. A combination of the two.

The application of the credit method is the most widely used because of the difficulty that may be encountered with cash refunds.

GOODS EXEMPTED FROM VAT

Certain goods and services are not VATable. The implication is that VAT charges are not applicable to it. On the other hand, certain goods and services are considered zero rates. This implies that the goods are VATable, but the application is zero percent.

Examples of Goods exempted from VAT

• Medical and pharmaceutical products
• Basic food items
• Books and educational materials
• Baby products
• Commercial vehicles and their spare parts
• Agricultural equipment and products and vertinary medicine
• Fertilizers, farming machinery and farming transportation equipment
• All exports
• Plants and machinery used in export processing zone
• Plant, machinery and equipment purchased for utilization of gas in downstream petroleum operations
• Tractors, ploughs, agricultural equipment and implements purchased for agricultural purposes

Services Exempted From VAT

• Services of Community Banks, Peoples Banks and primary Mortgage Institutions
• Plays and performances conducted by educational institutions as part of learning
• Services related to education
• Medical services
• All exported services

Form in use by the Tax Payer

The following forms are in use by the tax payers:

1. Form VAT 001

2. Form VAT 002

Form VAT 001 – VAT Registration Form

This is the standard registration form for VAT. It is supposed to be completed by a potential VAT payer within six months of the commencement of business.

VAT Form 001 usually contains the following information:

• The name of the taxpayer
• The principal place of business of the taxpayer
• Other branches or units where business is carried on
• The date of incorporation of business
• The date of commencement of business
• The registration number of the business
• The nature of business
• Types of goods/services dealt in
• The local VAT office where registration is sought
• The name and designation of a principal officer of the business
• The date application is filled.

The application must also bear the official stamp of the business, a formal written application for registration on the business letter-headed paper as well as the signature of the principal officer. A copy of the registration certificate must be attached but the original would be presented for sighting.

FORM VAT 002 – Value Added Tax Returns

This is the standard value added Tax returns to be filled every month. A typical form 002 contains the following information.

• VAT identification number
• Name and address of the VAT payer
• The local VAT office where the return is being filled
• The month for which return is related
• Total VATable supplied made
• The zero-rated supplied included in the VATable supplies
• The total supplied subjected to VAT
• VAT charged
• Any adjustments
• Total tax output
• VAT on domesticated supplies received
• VAT adjustments on supplies received
• VAT on import
• Total VAT payable
• VAT on purchases not wholly used to be backed out of total VAT payable
• VAT taken at source, also to be backed out of VAT payable
• Total input tax
• Amount payable or refundable
• A declaration by an official of the taxpayer that the particulars in the returns are true and correct.

NOTE: VAT Returns must be filed with the FIRS on or before the 21st day of the month following the month of transaction. Failure to comply will attract the following penalties:

i. For businesses not registered for VAT: A penalty of N10,000 for the first month in which the failure occurs and N5,000 for each subsequent month. An unregistered business that fails to remit VAT after a period of time will be sealed up by the FIRS.

ii. For businesses registered for VAT: A penalty of a sum equal to 5% per annum plus interest at a commercial rate payable within 30 days of notification by the Tax Authority.

Thank you for reading. I hope you learnt one or two things?

SOURCE: Accounting Wizards’ Blog

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