A new bill in Nigeria proposes that individuals involved in banking, insurance, stock-broking, and other financial services must provide a Tax Identification Number, TIN, to open or operate an account.
Titled “A Bill for an Act to Provide for the Assessment, Collection of, and Accounting for Revenue Accruing to the Federation, Federal, States, and Local Governments; Prescribe the Powers and Functions of Tax Authorities, and for Related Matters,” the legislation aims to enhance tax compliance and improve revenue collection.
The bill, dated October 4, states that any person engaged in financial services must submit a tax ID when opening a new account or managing an existing one. This requirement is part of a broader initiative to ensure that all participants in financial activities are registered for tax purposes.
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Additionally, the bill stipulates that non-residents supplying taxable goods or services to individuals in Nigeria must also register for tax purposes and obtain a TIN. However, non-residents earning only passive income from investments in Nigeria will not need to register, though they must provide relevant information as required by the tax authority.
To streamline compliance, the bill empowers tax authorities to automatically register individuals who should have applied for a TIN but did not. Those individuals will be notified of their registration and the issuance of their tax ID.
Non-compliance with these requirements could lead to administrative penalties, including an initial fine of N50,000 for the first month of non-registration, followed by N25,000 for each subsequent month.
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