COVID-19: FIRS extends the period to enjoy a waiver of interest and penalty from the settlement of outstanding tax liabilities

The Federal Inland Revenue Service (FIRS) recently issued a Public Notice extending the deadline for obtaining a waiver of interest and penalty on outstanding tax debts resulting from tax desk review, audit and/or investigation assessments, from 31 May 2020 to 30 June 2020.  Additionally, the FIRS extended the waiver to tax liabilities arising from self-assessment filings and approved instalment Voluntary Assets and Income Declaration Scheme (VAIDS) plan that have not been fully/partially complied with. The waiver only applies where taxpayers settle their outstanding tax audit liabilities (principal amount) on or before 30 June 2020.  

This Public Notice is a follow on to an earlier notice issued by the FIRS on 30 April 2020, informing taxpayers of the waiver of interest and penalty on outstanding tax audit liabilities if they pay the principal sum of their outstanding tax audit liabilities on or before 31 May 2020. Please refer to our previous alert on this.

This waiver only applies to tax liabilities which have been determined by way of self-assessment filings, approved VAIDS instalment plan or FIRS’ assessment arising from a tax audit/investigation.  The inclusion of self-assessment filings in the waiver enables taxpayers to do a self-check of their tax remittance status and remit any unpaid taxes (without incurring penalty and interest). With respect to VAIDS, taxpayers who have not fully complied with the approved instalment plan and do not take advantage of this window, stand to lose the undermentioned incentives, which would have been applicable:

  • Waiver of penalty and interest
  • Exemption from tax audit and
  • Exemption from tax investigation

Taxpayers who were unable to take advantage of the initial grace period now have till 30 June 2020 to do so. 

Please click here to download a copy of the Public Notice.

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