Simplified and Business-Friendly Withholding Tax (WHT) Regulations 2024
The new Withholding Tax (WHT) Regulations 2024, officially gazetted on October 2, 2024, aim to simplify tax compliance for businesses in Nigeria. Set to be implemented on January 1, 2025, these regulations address complexities in the previous system, providing clarity on tax deductions at source and reducing tax burdens, especially for small businesses and industries with low margins.
Key changes include exemptions for small businesses (with transactions below ₦2 million per month), revised tax rates for various sectors, and new categories of exempt transactions, such as real estate and certain service fees. Additionally, the introduction of Tax Identification Numbers (TIN) for compliance ensures smoother administration, and businesses must now issue receipts for taxes deducted at source.
These updates promote ease of doing business, reduce tax evasion, and align with global best practices. To avoid penalties, businesses are advised to integrate these regulations into their accounting systems before the January 2025 start date.
Key Features:
- Exemptions: Small businesses (₦2M or less per month) are exempt from deducting WHT, provided the supplier has a valid TIN.
- Reduced WHT rates: Lower rates for industries with low-profit margins and exempt transactions like dividends to Real Estate Investment Trusts (REITs).
- TIN Requirement: Double the WHT rate applies if the recipient lacks a TIN.
- Simplified Compliance: New rules streamline WHT deductions, remittance, and receipt issuance.
Stay compliant and reduce your tax burden by learning more about these important changes. Download and read the full WHT Regulations 2024 now to get started.
