ON DECEMBER 12 2014, THE FEDERAL INLAND REVENUE SERVICE (FIRS) FINALLY LAUNCHED THE LONG AWAITED INTEGRATED TAX SYSTEM (ITAS) FOR THE PURPOSE OF ELECTRONIC TAX FILING IN NIGERIA. IT IS HOWEVER, AT PRESENT, ONLY AVAILABLE TO TAXPAYERS RESIDING IN LAGOS STATE BUT WOULD BE LAUNCHED IN OTHER STATES OF THE FEDERATION AS SOON AS POSSIBLE. THE PURPOSE OF THE ITAS IS TO ESTABLISH A COMMON PLATFORM WHERE ALL TAXES PERTAINING TO THE FIRS CAN BE FILED; AT A CLICK OF THE BUTTON AND FROM THE COMFORT OF THE TAXPAYERS’ DESKTOP. WHAT IS MORE? – THE USE OF THIS PLATFORM AS AGAINST THE MANUAL FILING SYSTEM AT THE TAX OFFICES IS TOTALLY OPTIONAL TO THE TAXPAYER.
As every new initiative, the ITAS e-filing platform has its outstanding positive features and also areas where further changes may need to be made to enhance its usefulness. In this write-up, we shall examine the process of getting the taxpayer registered on the ITAS platform, the unique features of this platform, and a comparison of these features with those of the existing manual filing system.
Getting unto the ITAS platform
To gain access to the ITAS platform, you need to follow these easy steps:
• Obtain the ‘e-filing access application form’ from any FIRS tax office nearest to you or download from the FIRS website: www.firs.gov.ng.
• Complete the form by nominating officers from your organization, agents or tax consultants who will represent your organization on tax matters (typically anyone who would be involved in your tax/ computations or filing process. We understand that taxpayers can always update this information to add or remove more people).
• You will need to indicate on the form the type of access you want each of the nominees above to have. For instance, either the rights to make changes or rights to file tax returns or rights to ‘view only’.
• Upon returning the completed form to FIRS tax office where your tax matters are usually
handled, the FIRS will issue your company a Joint Tax Board (JTB ) approved tax identification number (TIN), together with other log in details to enable you log unto the platform. These log in details will be the only key that gives you access to the e-filing site.
• You will be required to change your password upon first log-in. Please note that in case of loss of your password, you will need to re-apply to FIRS to issue you a new password.
Keep your password safe!
• The platform is user-friendly, hence you will be promptly able to navigate your way
through to filing completion.
• Using the ITAS platform, you can check your account balance, get credits for withholding tax (WHT) deducted from your fees (WHT and other scheduled taxes are yet to be activated on the ITAS platform. The FIRS promised to activate these taxes this year), change relevant registration details, send messages to FIRS, apply for your tax clearance certificate and make enquiries from the tax office through the customer service center.
Note: FIRS e-filing works best on google chrome or any version of internet explorer not less than version 9.
Rendering tax returns on the ITAS platform
To file your tax returns through the e-platform when you have received your log-in details:
• Login onto the platform. After a successful login, you will be positioned in your ‘Home’ page where you can see a summary of the declarations (i.e. tax returns) which need to be filed.
• To enable you complete the required fields appropriately, you are required to keep handy, either the hard or softcopy of the already computed tax return you want to file as you will be making reference to it as you key in the required figures.
• To commence your declaration, click on the ‘View all declarations’ hyperlink or on the
‘taxpayer service tab’. Then click on the tax type which you want to file at the moment. Choose the tax period for which you would like to file, and then click on ‘file now’ hyperlink on the relevant period on the expanded form.
• When you click on the “file now” hyperlink, the actual tax returns page opens and the relevant form lines are displayed.
• On this page you can decide to key in the tax computation figures (which you have already prepared before now) in each of the form lines (or fields) as applicable or you may decide to upload a scanned copy (csv file) of your previously computed tax returns (set out preferably, in the ITAS prescribed format).
Please note that the ITAS e-filing interphase cannot perform any mathematical (additions, subtractions etc.) or computation functions. All information to be keyed in must have been computed earlier on a different platform.
• When you are done completing the fields or uploading scanned copies of your tax computations and self-assessment forms (whichever you find more convenient), click on the “Submit declaration” button. This brings you to a confirmation stage where you can verify whether the amounts you have entered are correct or not.
Please we advise an independent second or third eye review (only possible on the same pc) at this stage as there is no provision for making changes once the ‘Yes’ button is clicked.
• If and when you are sure that you have captured all information correctly, click on “Yes” for the returns to be submitted.
• Following this action, your declaration will be submitted to the tax office and the page
showing “end declaration process” will be displayed.
• To view your submitted returns, click on the hyperlink “here” and you will be led to the
‘view filed declaration’ page where you can see a summary of your declaration (or filing).
• A document number will be displayed at the top right hand corner of the page where you have a summary of your declaration. Copy this document number for use at the bank where it will be required for settling the tax liabilities.
A choice between the e-filing and the manual filing
As we mentioned earlier, the existence of the ITAS platform does not preclude taxpayers from physically submitting their tax returns as they have always done at the tax offices handling their tax files. Therefore it is solely the taxpayer’s decision to choose whether to go onto the ITAS platform or continue filing the normal way.
A taxpayer may prefer the ITAS platform for the following reasons:
o It is more convenient to file your tax returns from the comfort of your office; a leverage which the e-filing platform offers.
o If you find the e-filing fields too complicated to fill, you can upload the scanned copies of your already computed tax returns onto the platform.
o You can send messages, or make your complaints online to an FIRS customer service representative.
o You can apply for your company’s TCC via the platform.
o Paper work is reduced.
o Once you are issued your JTB approved TIN, the issue of duplicate TIN comes to an end and all your tax credits would accumulate into your one tax account.
o Once the WHT function becomes active, it would remove the challenges of processing WHT credit notes and getting credit claims on such credit notes.
o You can view your tax filing history on the ITAS platform and know at a glance where you are defaulting.
o By its design, it constitutes an electronic backup platform that would make for easy retrieval and assessment of tax records in the event of tax audits or tax reviews.
On the other hand, a taxpayer may want to favor the usual manual filing system for the following reasons:
o The ITAS platform may involve double efforts and even double costs- this is because it cannot perform any computation functions. The taxpayer will therefore need to compute his/her taxes first on another platform and in the ITAS prescribed format, before keying the figures manually into the ITAS platform. The same double effort applies, although reduced, if the taxpayer chooses to upload scanned copies of the tax computations and self-assessment forms to the platform.
o Once the ITAS password is lost, the taxpayer cannot reset it. He needs to re-apply to FIRS for a new password.
o The companies’ income tax declaration page is rather too complicated to even allow for a choice of completion on the ITAS platform. In addition to a different and complex tax computation format, it contains pages for keying in virtually everything on the financial statements. Other taxes such as the value added tax (VAT) are easier to complete on the platform.
o There are no provisions for redirecting the completed tax returns online to different users for second or third eye review processes. Companies which internal control processes require several levels of reviews and approvals of such documents would have some challenges in this area.
o The WHT system, which is a critical area of concern for taxpayers, is yet to be activated on the ITAS.
o There is no provision for settling the tax liabilities on the ITAS platform. The taxpayer still needs to pay through the bank, although this payment can be made online still, in the comfort of the taxpayer’s office.
A choice of the ITAS filing system is left for the taxpayer to make, but whatever decision you make in this regard, be sure to carry your tax advisers along.