What is Tax?
Tax is a compulsory financial charge, levy or fee imposed on a taxpayer by the government (local, state, federal) on the production, distribution and consumption of goods, services a well as the disposal of chargable assets. Taxes may be imposed on income, consumption, etc. primarily toraise revenue for government expenditure and execution of projects for the common good of the citizen.
Who is a Taxpayer?
A taxpayer is every individual, whether self-employed or employed by another, and every business entity operating in Imo state, and who are obligated by relevant laws to pay taxes to the Imo state government.
Who is tax Compliance?
Tax compliance is the taxpayer ability to conform with the extent laws and regulations of Imo State. The taxpayer is required to submit an accurate records in addition to satisfactory remittances and returnns to the Constituted Tax Authority (IIRS)
What is a Constiituted Tax Authority?
The IIRS as a consituted tax authority is a body authorised by law with powers to assess collect and account for revenues accurable to the Imo State Government, in the form of taxes, levies, charges, fees etc. It is also mandated to administrate and enforce compliance with extent tax laws to boost Imo State's tax effort and overall sufficiency.
Taxpayer Obligations
- The first obligation of a taxpayer is to register and obtain the Imo State Social Benefit Number (IMSSBN). This is a pre-requisite for any individual or institution resident in Imo state and wishes to engage in any state government services e.g., Hospital, schools, etc.
- Conduct a self-assessment to determine the amount of tax to be paid.
- Deduct and remit PAYE (for employers) to the government before the tenth day of succeding month. These employers of labor act as PAYE agents for the IIRS and are also obligated to submit a schedule showing details of staff monthly salaries.
- File tax returns, on or before the due date(s), which for Direct Assessments is 90 days (march 31st) and for PAYE is 30 days (January 31st) after the commencement of every year.
- Declare and pay taxe(s) in full on or before the due dates through Imo State Treasury Single Account (IMTSA) through the Paydirect platform at any commercial bank, POS and Quickteller terminals at the Headquarters or any of the IIRS offices in the Local Government Areas (LGAs).
- Make full voluntary disclosure of all incomes and expenditures (for self-employed persons).
- Keep proper books of accounts, records and documents.
- Comply with all the other obligations imposed on the taxpayer by the tax laws.
TAXES PAYABLE TO THE IMO STATE GOVERNMENT
Personal Income Tax (PIT)
This serves as a guide for self-employed individuals and employers of labor, in making their remitances and returns and remittances to the Imo State Internal Revenue Service (IIRS). The Personal Income Tax Act (as amended 2011) is the law that guides the Imo State Government in collection of PIT through the IIRS. Generally, every resident of Imo state, regardless of if they are federal, state, local government or private workers have a legal obligation to pay PIT to the state government. There are two methods of PIT collection: Pay As You Earn (PAYE) i.e. taxes from employment and Direct Assessments i.e. Taxes from self-employed persons...read more >>
- Pay As You Earn (PAYE) is a method of PIT from employee’ salaries and wages through deduction at source by an employer. By the provisions of Sections 81 and 82 of the PITA, the employer is responsible for making such deductions and remitting same to the government within the stipulated time. These remittances must be accompanied by a detailed schedule of all the employees for which the deduction was made. IIRS shall provide the format for the schedule.
- Direct Assessment (DA) is raised directly on self-employed persons (e.g. Professionals, Contractors, Traders etc.). Section 41 of PITA charges such persons to, without notice or demand, file a return of income earned in the preceding year to the state tax authority.
Withholding Taxes:
It is the specified amount deducted at source from payment made to individuals or corporate entities in respect to services rendered. This amount is remitted to Imo State Government inline with provision of Personal Income Tax (PITA).
Capital Gains Tax (Individuals only)
It is a tax on the profit made from the sale of land, shares, machinery etc.
Stamp duties
It is a tax imposed on legal instruments/documents executed by individuals, this tax is usually placed on the transfer of homes, buildings, copyrights, land, patents and securities.
Business Premises levy
It is a tax on property used for generating icome...read more »
Hotel occupancy and Restaurant Consumption Tax: (where applicable)
It is a tax imposed on goods and services consumed in hotels, bars, restaurants and event centers within Imo State. This tax is payable by the consumers who purchase these goods and services. The hotels, bars, restaurants and event centers serve as collecting agents for the government and are expected to remit same to the government within the stipulated time. See the Hotel Occupancy and Restaurant Consumption Tax Law of Imo State...read more »
Land use Charge (where applicable)