Is entertainment an allowable expense in Nigeria?
Although business entertainment provided to clients may well be wholly and exclusively for business purposes, it is not allowable for tax purposes.
What is the rate of capital allowance in Nigeria?
Capital allowances claimable in any year are restricted to two-thirds of assessable profits for all companies, except companies in the manufacturing and agricultural sectors, which are excluded from this restriction. 95% initial allowance for plant used in agricultural production; others 50%.
What are the conditions to be eligible for capital allowances?
The conditions to claim CA on an asset Incurred: There must be a qualifying expenditure incurred, meaning you have paid for it; Ownership: you are the owner of the asset at the end of the basis period; Used: that asset was used for the business purposes.
Can you claim capital allowances on computer equipment?
Capital assets include items you buy to use in your business such as equipment, machinery, and cars or vans for business purposes. For instance, if you’re starting a new contracting company, you can claim for the purchase price of a new computer or server for use in your business.
What are not allowable expenses?
Costs of business premises such as utility bills and rent (costs associated with buying property aren’t considered allowable expenses) Travel costs such as fuel, parking or train tickets (travel to and from work isn’t an allowable expense) Staff costs such as wages, salaries, bonuses and pensions.
What are the allowable and disallowable expenses?
Allowable Expenses include any amount in your turnover that is unpaid and written off. Disallowable Expenses include any debt not included in turnover, debts relating to fixed assets, and general bad debts.
How do we calculate capital allowance?
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- Practice Note on Capital Allowance.
- Depreciation Allowance. = AxBxC. 365days. Where A= GH 20,000.00 B= 40% C= 365days. Depreciation Allowance. = GHS 20,000.00 x 40% x 365days. 365days. = GHS20,000.00 x 0.40. = GHS8,000.00. Year of Assessment (Y/A) Basis Period (B/P) Class 1- 40% 2016. 01/01/16-31/12/16. GHS.
Is a van a capital allowance?
Capital Allowances – Vans Vans are considered plant and machinery and are generally main pool assets for capital allowance purposes, so attract WDAs of 18%.
Is a laptop a capital allowance?
For equipment including business computers, you will claim capital allowances. Capital expenditure generally includes anything that you purchase and own to help you earn profits in your business, so laptops will fit into this category.
What deductions can I claim?
Common Itemized Deductions
- Property Taxes.
- Mortgage Interest.
- State Taxes Paid.
- Real Estate Expenses.
- Charitable Contributions.
- Medical Expenses.
- Lifetime Learning Credit Education Credits.
- American Opportunity Tax Education Credit.
How to calculate total capital allowance in Nigeria?
Calculate the capital allowance. Total capital allowance = NGN (500,000 + 2,500,000 + 625,000) = NGN 3,625,000 A taxpayer can claim initial allowance and investment allowance only once throughout the useful life of a plant and machinery.
How much capital allowance can Company ABC Claim?
The annual allowance will be prorated for the year. From April to December 2018 is nine (9) months. Company ABC is a construction company with assessable profit of NGN 4,800,000 and capital allowance of NGN 5,600,000 in 2019 tax year. How much relief can Company ABC claim?
What is the rate of tax for CITA in Nigeria?
Section 40 (6) CITA provides for a lower rate of tax of 20% payable by companies in the preferred sector of the economy such as agriculture, manufacturing, solid minerals or wholly export trade for the first 5 years of commencement of business, where the turnover is less than ₦1 million. Part 1. Goods
What is Section 30 CGTA of the Nigerian tax law?
Section 30 CGTA: gains accrued to a person from disposal by him of Nigerian Government securities, stocks and shares shall not be chargeable gains.