• Friday, March 29, 2024
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Explainer: How to process tax clearance online

Unlocking success strategies: Navigating Nigeria’s tax challenges dynamically

This week, the Federal Inland Revenue (FIRS) announced that a single click is what is required on its TaxPro Max solution, which was designed to enable taxpayers to process Tax Clearance Certificates (TCC) without recourse to the agency’s offices across the country.

According to the FIRS, this new innovation is only applicable to organisations whose tax liability is up to date and do not have any outstanding charge balance with the tax authority.

This implies that businesses that are not up-to-date with payment or have outstanding audits or currently undergoing one may not be able to access the platform.

What is TaxPro Max?

TaxPro Max is a tax administration solution introduced by the tax authority in June 2021 as a one-stop-shop for taxpayer registration, tax returns filing, tax payment, and tax clearance certificate requesting, among other functionalities.

TaxPro-Max enables registration, filing, payment of taxes and automatic credit of withholding tax as well as other credits to the taxpayer’s accounts, among other features. It also provides a single view to taxpayers for all transactions with the FIRS.

This innovation is coming on the heels of widescale technological reforms that the agency has embarked on in its bid to achieve 100 percent automation of its tax administration functions.

Muhammad Nami, executive chairman of FIRS, said this functionality is in line with the objectives of the agency to make the lives of taxpayers easier and ensure the ease of doing business in the country.

Since June 2021, the TaxPro Max has become the channel for filing naira-denominated tax returns. The agency has now equipped it with the capacity to issue TCC for companies without outstanding liabilities.

How to process TCC under TaxPro Max

After filing returns and paying the taxes, business owners can request for an electronic tax clearance certificate (e-TCC) from the comfort of their homes or office using the TaxPro Max e-service.

They have to log onto the application portal, which has a link on the FIRS website and follow online prompts to complete the form.

Application for the TCC can only be made electronically and online by visiting the official website of the agency. Upon approval, a link to download the e-TCC will be instantly sent to the email where the TCC can be printed.

“This process usually takes two weeks before approval, but with the revised innovation made by the tax authority TCC can be issued immediately upon approval,” the FIRS said.

A tax clearance certificate is a document issued by a revenue authority to show that a person has paid taxes in full or that no tax is due on such profits or income.

Apart from being a statutory requirement, having an updated TCC can make a company eligible for government programmes including contracts and intervention funding.

In Nigeria, the FIRS and the relevant State Internal Revenue Service issue TCC to taxpayers annually.