Tax is a compulsory contribution paid to government by her citizens to service the cost of governance in terms of provision of essential services to the society such as schools, electricity, potable water, roads, hospital, e.t.c. These taxes are for the benefit of the citizens.
Personal income tax is a type of tax imposed on the income of individual who are either in employment or are running their own business under a business name, a trust or partnership.
Personal income tax (Amendment) Act is the amended personal income tax law, cap P8, LFN 2004. This is a law that takes care of tax matters as it affects all income earners. These are employees, self-employed and all other others persons that earns an income in Nigeria.
All persons who earn income are it on a temporal or permanent basis; weather employees or individual that carry out business activities are required to pay personal income tax. The state internal revenue service collect personal income tax from: individuals resident in the state, body of individual such as communities, families that run a business. Business names and partnership; Executors of estate of deceased persons and trustee. Etc.
Tax due and payable by employee by reason of their employment, otherwise known as PAYE, shall be deducted by their employee and remitted to the self- employed are required to assess them, file their returns and make payment on annual basis on the income of preceding year to the relevant tax authorities.
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