ICAN 2026 Taxation | Mixed

Bluechips Nigeria Limited is a limited liability company incorporated in Nigeria in 2020 and has been in business for so many years. The following information has been extracted from the company's records for the year ended December 31, 2024: N Sales 150,000,000 Direct cost (22,500,000) Gross profit 127,500,000 Other income 30,375,000 157,875,000 Administrative and other expenses (112,091,250) Profit before tax 45,783,750 Additional information: N (i) Other income included: Dividend (net) 5,650,540 Rent (net) 3,460,000 Interest on government securities 7,550,000 Interest on foreign placement 11,256,500 Gains on foreign exchange - Translation of domiciliary account balance 1,480,500 80% of the interest on foreign placement was repatriated through a government - approved channel. (ii) Administrative expenses included: N Depreciation 1,850,000 Audit fees 2,150,000 Directors' remuneration 7,500,000 Legal expenses 5,570,050 Other operating expenses 15,800,850 (iii) Legal expenses comprised: N Commission paid for debt collection 250,000 Legal cost of a tax appeal made by the company to the FIRS 1,750,000 --- PAGE BREAK --- Share issue expenses 1,070,050 Retainership fee 2,500,000 (iv) Other operating expenses included: N Value added tax on computer hardware 120,000 Rent paid in respect of accommodation rented for a management staff of the company whose basic salary was N2,400,000 per annum 3,600,000 Misappropriated funds by the Director of Finance 2,500,000 Defalcations by the Sales Clerk out of which, the company recovered a sum of N200,000 under fidelity insurance 525,000 Loss on property, plant and equipment 150,000 Loss on foreign exchange on payment for importation of inventory 500,000 (v) The company made donations to the following entities: N Van Leer Nigerian Educational Trust 250,000 Kewa Limited 300,000 Paterson Zochonis Nigerian Technical Education Trust Fund 200,000 The Christian Church of Nigeria 100,000 AFP Foundation Limited 500,000 (vi) Total marketing expenses of N3,000,000 included: N Corporate/promotional gift items 1,000,000 Corporate adverts 1,200,000 Facilitation of port operations when importing the inventories for the company 800,000 3,000,000 (vii) Unrelieved loss brought forward 10,345,000 (viii) Agreed claimable capital allowance 2,850,000

Chief Bamidele Lawrence, a renowned industrialist/business mogul, established a trust, Bamidele Lawrence Trust Foundation. The beneficiaries of the trust are his only child, Josephine and his two grandchildren - Abel and Abigail. The trustee, DAOL Legal Practitioners, is to apply the income accruing to the trust as specifically stated in the trust deed. The records of the trustee show the following information for the year ended December 31, 2023: Income: N Trading income 100,000,000 Rental income (Net) 480,420,000 Miscellaneous income 10,000,000 The operating expenses for the year amounted to N48,850,000. Capital allowance claimable for the year was N19,300,000.

Mr. Ade, a property investor, executed a deed of assignment for the transfer of his land located in Lagos. The deed was submitted to the Commissioner of Stamp Duties for adjudication to determine the appropriate duty payable.

The Nigeria Startup Act 2022, was signed into law on October 19, 2022, to foster innovation, attract investment, and create a favourable business climate for tech-enabled startups in Nigeria. The Act provides a legal and institutional framework for the development of startups, with the goal of positioning Nigeria as a leading digital technology hub in Africa. Mr. Akin, a young entrepreneur in Lagos, was considering registering his fintech company under the Nigeria Startup Act to obtain the startup label. He sought your professional advice as a Tax Consultant.

You applied for the position of a Tax Officer in a company. During the interview, a panel member asked you to explain some basic concepts of taxation to demonstrate your understanding of the subject.

The Local Government Revenue Committee (LGRC) for each local government area of a State was established by Section 90 of the Personal Income Tax Act, 2004 (as amended).

The Nigeria Customs Service (NCS) is one of the major revenue-generating agencies of the Federal Government. The Nigeria Customs Service Act, 2023 repealed the Customs and Excise Management Act, Cap. C45, Laws of the Federation of Nigeria, 2004, and other related legislations.