Following the announcement by the Vice President of the Federal Republic of Nigeria Professor Yemi Osinbajo in June 2018, companies operating in the creative and innovative industries are now eligible for pioneer status incentive. With this announcement, companies manufacturing products or rendering services in media and broadcasting; technology; e-commerce; photography; music production and publishing; amongst others, qualify for the tax relief.
To be eligible for this relief, an applicant must:
1. Be registered as a corporate body in Nigeria;
2. Have a minimum share capital of N10,000,000 (Ten Million Naira);
3. Submit a duly completed application form in which company must demonstrate that its business activities contribute immensely to the Nigerian economy;
4. Submit an application within one year of commencement of service/business activities;
5. Pay an application fee of N200, 000 (Two Hundred Thousand Naira);
6. A service charge consisting of 2% of the company’s estimated savings from the tax exemption;
7. Pay due diligence fees to cover costs incurred by the Industrial Inspectorate Department who conduct preliminary investigations of the business; and
8. Submit a five-year financial plan.
Companies that are issued pioneer status certificates are periodically monitored and evaluated by the Nigerian Investment Promotion Commission to access how well the tax incentives are utilised and to encourage compliance with the five year financial plan. The validity period for pioneer status is 3 (Three) years which may be extended on expiration for not more than 2 (Two) years.
For more information please contact sadeyemi@olajideoyewole.com
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