Article by: Abdulateef Olatunji ABDULRAZAQ (Founder, Taxmobile.Online)
Value Added Tax (VAT) is a consumption tax imposed on the value of the supply of taxable goods and services produced and consumed in Nigeria. The Finance Act (FA)2020 generally defines taxable supplies of goods and services as supplies received and consumed by a person in Nigeria, regardless of the location of the supplier. Such non-resident persons are required to include Nigerian VAT on their invoices to Nigerian customers.
The tax shall be computed at the rate of 7.5% with effect from 1st February 2020, on the value of all goods and services, except that goods and services listed under Part III of the first schedule of the VAT Act(As Amended).
VAT is administered and managed by the Federal Inland Revenue Service(FIRS) and they may do such things as it may deem necessary and expedient for the assessment and collection of the tax and account for all amounts so collected following the provisions of the VAT Act.