Police Trust Fund in Nigeria- How Companies must comply with this Payment

Police Trust Fund in Nigeria- How Companies must comply with this Payment

August 05, 2022

On 24 June 2019, the Nigerian President signed the Nigeria Police Trust Fund (Establishment) Bill (“Police Trust Fund Act” or “the Act”) into law. The Act establishes the Nigeria Police Trust Fund (Trust Fund) to provide funds for, inter alia, the training and welfare of personnel of the Nigeria Police Force. The Act also states that the Trust Fund would consist of funds from a levy of 0.005% of the net profit of companies operating a business in Nigeria amongst other sources.

Under Section 4(1)(b) of the Act, the FIRS is empowered to assess, collect, account and enforce the payment of the stipulated 0.005% of the net profit of companies in Nigeria, into the Police Trust Fund.

However, there is a recent controversy following the decision of the Federal High Court in the case of AG Federation and AG Rivers, where the Federal High Court held that the tax taken by the Federal government into the Federation Account and remitted to the Nigerian Police Trust Fund was illegal and contrary to the provisions of Section 161(1) the Constitution, which provides that taxes and other funds paid into the Federation Account are to be shared between the Federal, State and Local Government.

The debatable question becomes, where the purpose for which a Law is enacted is defeated, will there be need for such Law and its enforcement.

Considering the decision of the FHC and pending the challenging of the decision, it may seem that the enforceability of the Section 4(1)(b) of the Police Trust Fund Act; the decision may impact on the powers and ability of the FIRS, to henceforth collect the 0.005% levy imposed on the net profit of companies operating in Nigeria,

Companies operating in Nigeria are adviced to seek professional advice from their legal and tax advisors regarding their obligation to pay the 0.005% levy imposed on their net profits under the Act.

Team 618 Bees

 

 

 

The information in this blog post (“post”) is provided for general informational purposes only, no information contained in this post should be construed as legal advice, nor is it intended to be a substitute for legal counsel on any subject matter. No reader of this post should act or refrain from acting on the basis of any information included in, or accessible through this post without seeking the appropriate legal or professional advice from the particular facts and circumstances at issue from a lawyer. This post is protected by intellectual property law and regulations. It may however be shared using appropriate sharing tools provided that our authorship is always acknowledged and this Disclaimer Notice attached

 

 

More Articles

Search

Connect With Us

Got any questions?

If you are having any questions, please feel free to ask.

Send us an email

Frequently Asked

  • What additional documents do I require to file my Annual Returns?
  • Must my Company Secretary be a Lawyer?

    Although it’s ideal to have a lawyer as a company secretary, it is not compulsory for small private businesses.
  • Why is mutual assent important in a contract?

    This is one of the key elements of a contract because is shows the meeting of the minds of both parties
  • Is there a penalty for late renewal of registration of products with NAFDAC?

    Yes, there is a late renewal fee, which is dependent on the category of the product.
  • What is classified as personal data?

    Name, photograph, personal health/bio information, account/financial information, phone number, Address, date of birth, place of birth, Email address, etc.
  • What is eligible for Patent registration?

    Patents are granted for the invention of products or processes. However, for it to be patentable, the invention

    • Must be new,
    • Must have an inventive step that is not obvious to someone with knowledge and experience in the subject,
    • Must be capable of being made or used in some kind of industry and not be, a scientific or mathematical discovery, theory or method, a literary, dramatic, musical or artistic work, a way of performing a mental act, playing a game or doing business, the presentation of information, or some computer programs, an animal or plant variety, a method of medical treatment or diagnosis,
    • And must not be against public policy or morality.
  • Do I have to physically drop off my product sample at NAFDAC office?

    No, you can choose to have it sent to NAFDAC office
  • Why do i need a Shareholders Agreement?

    You need a Shareholders Agreement to protect your investment in a company.  The shareholders Agreement establishes a fair relationship between all shareholders and sets out how the company is run.
  • Can I trademark my logo and name separately? Why is this a good idea?

    Yes you can. The advantage is that it gives you the opportunity to have more than one logo or the opportunity to change your logo easily as opposed to registering the name and the logo as one trademark.
All FAQs
Call Us Now on +234 901 719 0079 Chat on WhatsApp