In a resolute move to combat tax evasion and enforce regulatory compliance, the Corporate Affairs Commission (CAC) of Nigeria is poised to delist a staggering 91,843 companies from its register for neglecting to submit their annual returns.
This stern action by the government agency reflects a commitment to holding businesses accountable and curbing tax irregularities.
A tax return is a crucial document filed with a tax authority, detailing income, expenses, and other pertinent tax information. It enables taxpayers to compute their tax liability, schedule payments, or seek refunds for overpaid taxes. In many jurisdictions, individuals and businesses with reportable income, encompassing wages, interest, dividends, capital gains, or other profits, must annually file tax returns.
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The CAC, in a list published on its website, unveiled the names of the companies slated for delisting. The figure of 91,843 is marginally lower than the initial count of 94,581 released in August. Notably, this reduction is also beneath the previously announced 100,000 companies earmarked for removal, underscoring the stringent approach adopted by the CAC.
Garba Abubakar, the Registrar-General and CEO of the CAC, had declared in July that the commission would expunge 100,000 registered businesses from its database due to their failure to file annual returns. Abubakar emphasized adherence to section 692 of the Companies and Allied Matters Act (CAMA) of 2020, noting that affected companies would receive notices before any action was taken.
“Further to its earlier notice of the commencement of striking off the names of Companies from the Register of Companies and published on August 2, 2023, the Commission hereby notifies the General Public that the list of Companies that have failed to comply with the provisions of the Companies and Allied Matters Act 2020, to file up to date annual returns is now ready for publication in accordance with the provisions of Section 692 of the Act,” he said.
In an update on December 5, the CAC reiterated its intent to strike off companies that did not comply with the CAMA 2020 provisions regarding annual returns. The commission urged companies that had submitted complete annual returns in response to the earlier publication to verify their removal from the delisting list. The updated list is available on the commission’s website.
The CAC also outlined a process for businesses erroneously included in the list to rectify the situation. Companies that had filed full annual returns but remained on the list were instructed to email [email protected] within 30 days, providing proof of filing. Additionally, the CAC emphasized that companies removed from the register cannot engage in business activities until the Federal High Court orders their reinstatement.
The taxable year in Nigeria aligns with the fiscal year, spanning from January 1 to December 31. The CAC requires the submission of tax returns to the relevant tax authority within 90 days of the fiscal year’s conclusion.
Businesses with an income of NGN 30,000 or less are exempt from mandatory tax return filing. Moreover, every employer is obligated to submit a return of all emoluments paid to employees by January 31 each year, covering the preceding year’s employment.