Tax Compliance & TIN Guide for a Nigerian Non-Profit Community

TIN VERIFICATION & TAX CLEARANCE CHECK (ONLINE & USSD)

• Federal Inland Revenue Service (FIRS) TIN Verification Portal
– URL: https://apps.firs.gov.ng/tinverification/
– Steps:
• "Select Search Criteria" ⇒ choose “Tax Identification Number”.
• Input TIN (FIRS or JTB).
• Click “Search” to confirm authenticity and registration status.
• FIRS TaxPro Max / e-Services TCC Validation Portal
– URL: https://tcc.firs.gov.ng/tccvalidationnew
– Required fields: TIN or FIRS-ID + TCC Number.
– Confirms whether a Tax Clearance Certificate (TCC) is valid/issued.
• FIRS USSD Code
– Dial *829# on any network.
– Menu-driven options: retrieve TIN, verify TCC, other tax enquiries.
• State Internal Revenue Service portals
– Example (Ibadan / Oyo State): https://oyostaterevenue.com or https://www.oyostatebir.com (look for “Confirm TCC”).
• Golden rule: ONLY use official portals to avoid scams.

WHY A NON-PROFIT STILL NEEDS A TIN

• Mandatory legal requirement after CAC registration; operating without a TIN can attract penalties.
• Formal identity with FIRS & State IRSs; enables statutory filings.
• Required for opening a corporate bank account; banks will not onboard NGOs without one.
• Gate-keeper for grants, donor due-diligence & international remittances.
• Essential for:
– Applying for TCC.
– Deducting & remitting PAYE on employees.
– Deducting & remitting WHT on services, rents, contracts.
• Strengthens credibility, transparency & oversight.

TAX LANDSCAPE FOR NIGERIAN NGOS

• Companies Income Tax (CIT)
– Core charitable/educational/ecclesiastical income ⇒ exempt.
– \text{Taxable if: engages in “trade or business”} (merch sales, fee-based services, rental income, dividends, etc.).
• Value Added Tax (VAT)
– NGO purchases: VAT payable like any business (except zero-rated humanitarian donor-funded inputs).
– NGO supplies taxable goods/services ⇒ must charge & remit VAT.
• Capital Gains Tax (CGT)
– Gains exempt if wholly applied to public-benefit objects; otherwise taxable.
• PAYE (Pay-As-You-Earn)
– NGOs with paid staff must deduct PAYE monthly ⇒ remit to State IRS (OYIRS in Ibadan) by the 10th of the following month.
• Withholding Tax (WHT)
– Deduct on qualifying payments (consultants, rents, contracts) and remit to FIRS within 21 days of the following month.
– When companies pay the NGO for sponsorship/ads, they deduct WHT (e.g. 5\%) ⇒ NGO receives net amount + WHT credit note.

FUNDRAISING CONFERENCES & ACCEPTABLE REVENUE STREAMS

• Donations, sponsorships, grants, “launchings” = exempt income when applied wholly to mission.
• Exhibition stands, brochure ads, billboard/print ads, speaker sponsorship fees
– Treated as corporate sponsorship (supporting a cause) rather than a commercial advertising agency, PROVIDED the primary purpose remains fundraising.
– Companies must deduct WHT on these payments; NGO receives credit.
– VAT risk: chargeable only if the value of advertising service is substantial & clearly commercial. Keep acknowledgements incidental to avoid VAT.
• VIP Zoom tickets
– Considered a donation with enhanced experience; still exempt so long as benefit ≠ fair-market value.
• Free livestream, free meals, swag bags
– Reinforce charitable purpose; no taxable benefit to attendees.
– NGO still bears input VAT on purchases.

RECORD-KEEPING & RECEIPTS (NON-NEGOTIABLE!)

• Keep EVERY document: receipts, invoices, credit notes, bank statements, contracts, donation letters.
• Organise by year & category; retain for ≥ 6 years.
• Without documentary evidence, FIRS can disallow expenses, deny exemption, or levy penalties.
• Examples needing receipts:
– N250,000 CAC registration via Barrister Caroline (2024).
– UI Zoo entry passes, anniversary cake (2024).
– Letterhead design N5,000 (2025).
– CUG Glo SIMs (2025).

ANNUAL RETURNS & FILING PACKAGE

• Companies Income Tax (CIT) Return (FIRS)
– Contents:
• Audited Financial Statements (AFS).
• Tax & capital-allowance computations.
• Statement of surplus/deficit.
• Director/Trustee declaration of truth.
– Filing deadline for NEW NGO: \min(18\text{ months after incorporation},\;6\text{ months after first accounting year-end}).
• Example: Incorporation 16-Apr-2025, year-end 31-Dec-2025 ⇒ due 30\,Jun\,2026.
• CAC Annual Return for Incorporated Trustees
– First return due within 12 months of incorporation ⇒ by 16-Apr-2026.
– Subsequent returns between 30-Jun & 31-Dec each year.
• PAYE Annual Return (Form H1) ⇒ due 31-Jan following each year.
• Continuous remittances:
– PAYE ⇒ 10th of next month.
– WHT ⇒ 21st of next month.

TAX CLEARANCE CERTIFICATE (TCC)

• Certifies compliance for the immediate three preceding years.
• FIRS charges NO processing fee; “cost” = settling outstanding liabilities + filing all returns.
• Application via TCC module on TaxPro Max; often instant once records are clean.
• Prerequisites:
– All CIT, PAYE, WHT filings up-to-date.
– Evidence of PAYE remitted to State IRS.
– Nil or cleared CIT for exempt NGO.
• Third-party professional fees (auditor/tax consultant) may apply.

WHT CREDITS & REFUND MECHANISM

• When WHT{credit} > CIT{liability} ⇒ excess credit arises.
• Two options:

1. Carry forward to offset future liabilities/WHT deductions.

2. Apply for cash refund from FIRS (letter + copies of WHT credit notes + filed return).
   • Refund paid into NGO’s registered corporate bank account; may trigger FIRS audit and take time despite statutory \le 90-day target.

TIMELINE FOR THIS COMMUNITY

• Activity began (informally): 01-Oct-2023.
• CAC Certificate: 16-Apr-2025.
• Suggested first accounting year-end: 31-Dec-2025.
• Key dates:
– 31-Jan-2026: PAYE Form H1 (if any staff in 2025).
– 16-Apr-2026: First CAC annual return with audited accounts.
– 30-Jun-2026: First FIRS CIT return (Apr 16 → Dec 31 2025).
• Pre-incorporation expenses (Oct 2023 → Apr 2025) treated as pre-incorp costs; auditor must reconcile onto opening Statement of Financial Position.

SEEKING PROFESSIONAL HELP ON A TIGHT BUDGET

• Explore pro bono / discounted offers via:
– ICAN & CITN local chapters (write formal request letters).
– Mid-tier or boutique accounting/tax firms in Ibadan (CSR motives).
– University accounting departments (students supervised by faculty).
• Negotiate phased payments or sliding-scale fees.
• Strengthen internal bookkeeping to reduce external workload & cost.
• Consider fundraising earmarked for “compliance & governance” line-item.

IMMEDIATE ACTION PLAN (JUL 2025)

• Set up digital+physical filing system.
• Register as employer with OYIRS (PAYE) if staff anticipated.
• Educate treasurer on WHT deduction rates & deadlines.
• Draft outreach letters to ICAN/CITN & Ibadan firms for audit/tax assistance.
• Map conference revenue streams ⇒ design invoices that quote NGO’s TIN.

ETHICAL & PRACTICAL IMPLICATIONS

• Transparency builds donor trust and safeguards NGO from loss of exemption.
• Proper tax compliance prevents penalties and preserves eligibility for government or international partnerships.
• Aligning revenue activities with public-benefit mission avoids re-classification as a commercial enterprise.

QUICK REFERENCE: NUMBERS & FORMULAS

• USSD code: *829#.
• PAYE remittance deadline: 10th.
• WHT remittance deadline: 21st.
• First CIT return deadline (example): 30\,Jun\,2026.
• Excess WHT condition: WHT{credit} – CIT{liability} > 0 ⇒ refund/carry forward.
• Minimum record-keeping period: \ge 6\text{ years}.

TAKE-HOME MESSAGES

• A TIN is indispensable even for a tax-exempt NGO.
• Tax compliance ≠ paying income tax; it’s about filings, deductions, remittances, and transparency.
• Fundraising conferences, if structured as donor-centric events, are fully permissible and tax-efficient.
• Receipts are your best defence; professional guidance is your insurance.