Regarding implementation, although the Finance Act has a commencement date of 13th January, 2020, the Minister for Finance, Budget and National Planning announced 1st February, 2020 as the commencement date for the implementation of the VAT rate of 7.5%.
How is VAT calculated in Nigeria?
For instance, if you need to sell a product for N100,000 and you need to add VAT, simply multiply N100,000 by 5%, and you will get N5,000. Therefore, if you need to get N100,000 from a product, you need to add N5,000 when selling it in Nigeria, making it N105,000.
What is the VAT rate 2021?
The Chancellor announced at Budget 2021 that the temporary reduced rate of 5% will be extended to 30 September 2021. From 1 October 2021 the reduced rate for these supplies will be replaced by the introduction of a new reduced rate of VAT of 12.5% which will remain in effect until 31 March 2022.
Is VAT 14 or 15 percent?
VAT is now levied at the standard rate of 15% on the supply of goods and services by registered vendors. The tax rate was 14% until 31 March 2018.
How is VAT calculated?
To work out a price including the standard rate of VAT (20%), multiply the price excluding VAT by 1.2. To work out a price including the reduced rate of VAT (5%), multiply the price excluding VAT by 1.05.
How do I calculate VAT on a total amount?
How to Calculate VAT
- Take the gross amount of any sum (items you sell or buy) – that is, the total including any VAT – and divide it by 117.5, if the VAT rate is 17.5 per cent. …
- Multiply the result from Step 1 by 100 to get the pre-VAT total.
Is VAT charged on Labour in Nigeria?
VAT is chargeable on services provided to persons while in Nigeria regardless of the medium of delivery of the services; VAT is chargeable on services rendered remotely, online, or by virtual means to Nigerian residents or persons in Nigeria; and.
Is VAT being reduced?
General description of the measure. The government announced on 8 July 2020 that it intended to legislate to apply a temporary 5% reduced rate of VAT to certain supplies relating to hospitality, hotel and holiday accommodation and admission to certain attractions.
Is VAT going to be reduced?
The standard rate of VAT in the UK is 20%, with about half the items households spend money on subject to this rate. … The lower rate also currently applies to sanitary products, although in the March 2020 Budget, the government announced it will stop charging VAT on these goods from 1 January 2021.
What are the new rules on VAT?
From 1st March 2021, VAT-registered subcontractors will no longer charge VAT on certain construction services to another VAT-registered business. Instead, the customer will ‘self-account’ for any VAT due – this is known as the Reverse Charge.