- February 21, 2022
- Posted by: Bastion team
- Category: World News
Professionals have said that the Finance Act 2022 is a blessing in disguise for the real estate industry, as it will provide leeway for real estate investors to explore relevant incentives and reduce tax burdens to grow their investments.
The President Muhammadu Buhari assented to the 2021 Finance Bill, thereby introducing the 2021 Finance Act, effective January 1, 2022. The Act made changes to 12 laws, including Companies Income Tax Act, Personal Income Tax Act, Capital Gains Tax Act, Stamp Duties Act, Tertiary Education Trust Fund (Establishment]) Act, Value Added Tax Act, Insurance Act, National Agency for Science and Engineering Infrastructure Act.
According to Wole Obayomi of KPMG Nigeria, the Act updates some of the amendments introduced in the previous Finance Acts and introduces additional changes to several existing tax laws and other legislations.
Key highlights listed by Obayomi include restriction of capital allowance claimable by a company that earns both taxable and tax-exempt incomes, where the tax-exempt income is greater than 20 per cent of taxable income in any year of assessment. The capital allowances computed on qualifying assets used in generating both taxable and tax-exempt incomes will be prorated and only the portion relating to the taxable income will be allowed as capital allowance deduction against the assessable profit of the company.
“ The resolution of the hitherto impossible tax position of unit trusts…