ACC 201 TAXATION 1 SUMMARY 08024665051 - Copy - 041709

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ACC201 - TAXATION 1 SUMMARY
All levels of government need funds to finance their activities.

True
All levels of government need _______ to finance their activities.

Funds
The major source of federal government revenue in Nigeria is the revenue from the sale
of_______.
crude oil
The major source of federal government revenue in Nigeria is the _______from the sale of
crude oil.
revenue
State and local governments in Nigeria are financed mostly through the ______from the
federation account.
statutory allocations
State and local governments in Nigeria are financed mostly through the statutory allocations
from the _____account.
federation
In Nigeria, state and local governments in Nigeria are financed mostly through _____
The statutory allocations from the federation account
A ______ is a compulsory payment.

Tax
A tax is a compulsory payment.

True
A tax is a ______ payment.

compulsory
A _______ is the levy by public authorities with a tax jurisdiction, of compulsory

contributions by the citizens to defray part of the cost of government activities in providing
the needs of the society.
Tax
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_______ is the process or machinery by which communities or groups of persons are made to
contribute in some agreed quantum and method for the purpose of the administration and
development of the society.
Taxation
________ is the transfer of real economic resources from the private sector to the public
sector to finance public sector activities
Taxation
______ can simply be defined as a charge on income of individuals and corporate bodies by
the government.
Tax
_______ can be defined as compulsory payment imposed by the government through its
agents on income of individuals and corporate bodies as well as on goods and services.
Tax
A _______ is a compulsory payment made by individuals and organizations to the

government in accordance with predetermined criteria for which no direct or specific benefit
is received by the tax payer.
Tax
According to_____ , a tax is “a payment to central government, calculated by laid down rules
for which nothing specifically usable by that taxpayer alone is transferred.”
Pritchard and Murphy
Chief Justice Latham of the Australian Supreme Court defined a ______as “a compulsory
extraction of money by a public authority for public purposes”, or taxation is raising money
for the purpose of government by means of contributions from individual persons.”
tax
______ generated from taxation is usually used for developmental purposes.

Revenue
Revenue generated from _______ is usually used for developmental purposes.

Taxation
Revenue generated from taxation is usually used for _____ purposes.

Developmental
Tax is imposed for the following reasons

 To cover the cost of administration, internal and external defence, maintenance of law
and order as well as social services required by the citizens.
 To protect companies in infant stage
 To discourage the consumption of dangerous/harmful products.
 To control the importation, production and consumption of certain goods and services
thereby preventing dumping.
 To redistribute wealth and income among various income earners through progressive
tax system
 To counter inflation by reducing volume of purchasing power
 To provide subsidies in favour of preferred sectors of the economy
 To service national debt and provide retirement benefit
The following are the canons/principles of taxation

 Principle of Equity
 Principle of Convenience
 Principle of Certainty
 Principle of Simplicity
 Principle of Economy
 Principle of Impartiality
 Principle of Productivity/Fiscal Adequacy
 Principle of Flexibility
A good tax system should be equitable in the distribution of tax burden.

True
Principle of ______ is in respect of timing and mode of payment.

Convenience
Principle of ______ stipulates that the time, mode and amount to be paid should be clear to
the taxpayer.
Certainty
A good tax system should be coherent, simple and______.

straight forward
The _____ relates to cost of administering tax and provides that the imposition of tax is
uneconomical if the cost of collection is in excess of revenue generated.
Principle of economy
A ______ can be considered economical if the cost of administration is not excessive so that
a loss is not incurred in the process.
Tax
A tax can be considered ______ if the cost of administration is not excessive so that a loss is
not incurred in the process.
Economical
Principle of ______ advocates that a tax system should not discriminate between tax payers
under similar circumstances
Impartiality
_________ requires that all persons should similarly be placed under the same condition, to
pay the same tax.
Principle of Impartiality
Which principle recognizes that the yield from a tax should be adequate to cover government
expenditure in terms of promoting economic growth and development?
Principle of Productivity/Fiscal Adequacy
______ states that a good tax system should be responsive to changing realities especially in
a federal and democratic country where there are always changes of government.
Principle of flexibility
_______ proposes that a tax system should be adjustable to allow for scrapping of obsolete
tax system and replacing same with meaningful tax process.
Principle of flexibility
There are ______ tax authorities in Nigeria

Three
Broadly, there are three (3) tax authorities, namely:

 Federal Inland Revenue Service Board
 State Internal Revenue Service Board
 The Local Government Authorities
Lord Luggard introduced income tax in Nigeria in the year______

1904
In 1904, Lord Luggard introduced income tax in Nigeria with the introduction of community
tax in ______ Nigeria.
Northern
______ made changes which crystallized into the Native Revenue Ordinance of 1917.
Lord Luggard
Lord Luggard made changes which crystallized into the Native Revenue Ordinance
of_______.
1917
The Direct Taxation Ordinance No. 4 was enacted in ______

1940
The Income Tax Ordinance No. 29 took effect from 1st April, ______
1943
Nigeria became a _____in 1954 under the Macpherson constitution
Nigeria became a federation in _______ under the Macpherson constitution

1954
Nigeria became a federation in 1954 under the _______constitution

Macpherson
________ became a federation in 1954 under the Macpherson constitution
Nigeria
The Eastern Region enacted its Finance Law No. 1 of in ______

1956
The Western Region enacted its own Income Tax Law in ______
1957
The Eastern, Western and Northern Regions enacted the Eastern Region Finance Law of
_____
1962
The federal government enacted the Personal Income Tax (Lagos) Act of _______ for the
federal territory of Lagos.
1961
The federal government enacted the Personal Income Tax (Lagos) Act of 1961 for the federal
territory of_______.
Lagos
By the _______ Constitution, the federal government was given exclusive jurisdiction to
make laws on tax matters
1979
LFN is an acronym for______

Laws of the Federation of Nigeria
________ is payment on the income of individuals, partnerships, executors and trustees.

Personal Income Tax
_______ is governed by the Income Tax Management Act (ITMA) 1961 as amended and
now referred to as Personal Income Tax Act (PITA) 104 of 1993 as amended up to 14th June
2011.
Personal Income Tax
_______ is a tax on income of companies engaged in petroleum operations.

Petroleum Profit Tax (PPT)
_______ charges duties on specified instruments listed in the Act.

Stamp Duties Act
________ tax is on income of Limited and Public Liability Companies other corporation
soles and companies engaged in petroleum operations (upstream operations).
Companies Income Tax
The current rate of Companies Income Tax is _____ % of chargeable profit.

30
______is charged on gains made from the disposal of a chargeable asset and the current rate
of this tax is 10% of chargeable gains.
Capital Gains Tax
_______ is charged on the value addition during the course of production of goods and
services.
Value Added Tax (VAT)
VAT stands for______

Value Added Tax
Value Added Tax (VAT) is charged at ______%.

5
_______ is levied on all companies at the rate of 2% of their assessable profits.

Education Tax
There are three (3) tax authorities representing the 3 tiers of government
 Federal Government – Federal Inland Revenue Service (FIRS)
 State Government - State Internal Revenue Service (SIRS)
 Local Government – Revenue Committee
FIRS is acronym for______

Federal Inland Revenue Service
_____is the federal tax authority and was created by the Companies Income Tax Act (CITA)
of 1979
Federal Inland Revenue Service was created by the Companies Income Tax Act (CITA) of
______
1979
SIRSB stands for______

State Inland Revenue Service Board
The State Internal Revenue Service was established by the Personal Income Tax Decree of
1993 as the state tax authority.
The operational arm of the State Internal Revenue Service board is_______
the state internal revenue service board
Functions of the Board (SIRSB)

 Ensuring the effectiveness and optimum collected of all taxes and penalties due to the
government under the relevant laws.
 Making recommendations, where appropriate to the joint tax board on tax policies, tax
reforms, tax legislation, tax treaties and exemption as may be required from time to
time.
 Generally controlling the management of the service on matters of policy subject to
the provisions of the law setting up the service.
 Appointing, promoting, transferring and imposing discipline on employees of the state
service.
SJRC is the acronym for______

State Joint Revenue Committee
The following are the functions of SJRC

 Implementing decisions of the Joint Tax Board
 To advise the Joint Tax Board and the State and Local Government on revenue
matters.
 Harmonise tax administration in the state
 Enlighten members of the public generally on state and local government revenue
 Carry out such other functions as may be assigned to it by the Joint Tax Board
Nigerian taxes can be classified in any of the following ways:

 Proportional
 Progressive and Regressive taxes
 Direct and Indirect taxes (incidence)
A _______ tax is one in which each taxpayer pays the same rate or percentage of his income
as tax
Proportional
A _______ is one in which the rate of tax increases as the income of the taxpayer increases.
Progressive tax
A _____ tax is the opposite of a progressive tax.

Regressive
________ tax is one in which the rate of tax decreases as the income of the taxpayer
increases.
Regressive
Classification based on Burden, taxes are classified as _______

direct and indirect
______ are taxes imposed directly on the income of individuals and companies.
Direct Taxes
Taxes imposed on goods and services are

Indirect Taxes
Indirect Taxes are otherwise referred to as_______.

expenditure taxes
Indirect taxes can be classified as _______

specific and ad varolem
Where a certain amount of tax is levied on each unit of a commodity produced or sold, it is
called a _____
specific tax
_____ is levied on the value of the product being taxed.

Ad varolem tax
The following are the advantages of direct taxes:

 Equitable
 Redistribution of Income
 Certain
 Control of Inflation
 Civil Consciousness
 Economical
The following are the disadvantages of direct taxes:

 Unpopular
 Inconvenient
 Tax evasion
 Disincentive to work
 Disincentive to investment
The advantages of indirect taxes are as follows

 Wider tax base
 Difficult to evade
 Convenient
 Beneficial social effects
 Equitable
The following are the disadvantages of indirect taxes

 Inequality
 Inflation
 Certain
 Loss of Revenue
 Tax Evasion
The annual return to be filed by any company will include

 Signed audited financial statement of the company
 Computation of capital allowance
 Computation of tax liability and other details as may be considered necessary.
These are types of Assessment

 Self-assessment
 Government assessment
 Turnover assessment
 Additional assessment
_______ involves the taxpayer preparing his account, computing the tax payable based on the
account, submitting the account to tax office before the due date, together with the cheque or
draft for payment of the tax liability.
Self-Assessment
The advantages of Self-Assessment

 The tax payer is entitled to 1% bonus of the tax payable
 Self assessment files are exempted from payment of provisional tax
 Self assessment filers are entitled or may apply for instalment payment of the tax
liability
________ is the assessment raised by the tax authority on tax payer either on the account
submitted or at the discretion of the relevant tax authority
Government Assessment
_______ is raised by the tax authority which is based on a percentage of the turnover of a
company.
Turnover Assessment
An additional assessment cannot be made later than ______ years

Six
_____ is defined as monetary charge imposed by the government on persons, entities or

property to yield revenue.
Taxation
Examples of taxes are Companies Income Tax, Personal Income Tax, Value Added Tax,
Petroleum Profit Tax.
The term ______could be described as the imposition by legal authority of tax, penalties and
fines.
Levy
PIT stand for______

Personal Income Tax
_______ is a levy imposed by the government of a country on its citizens, individual or

entities known as the taxpayers.
Income tax
Taxes imposed on the taxpayers or corporations or entities is termed _______

Company Income Tax
Tax imposed on the personal income of an individual taxpayer is termed ______

Personal Income Tax
The term BIK refers to ______

Benefits in Kind
______ are reimbursements other than cash enjoyed by employees in the course of their
employment in Nigeria.
Benefits in Kind
BIK comprised of the following

 Cost of water and electricity consumption borne by employer
 The use of a motor vehicle provided by an employer
 Free food provided by an employer
 Furniture and accommodation provided by an employer
 Services of domestic servants paid for by an employer
A ______is that which is available for domestic use of an individual in Nigeria on the first
day in a relevant tax year
Place of residence
An ______ is an individual or person who works in more than one place in Nigeria or who
earns daily wages.
itinerant worker
_______ means income derived from a trade, business, profession, vocation or employment
carried on by a person and a pension derived by him/her in respect of any previous
employment.
Earned income
Rent, dividends, royalty, discounts which may be received net of withholding tax are referred
to as_______
unearned income
CBN stands for_____

Central Bank of Nigeria
_______ is an obligation or authorization given in faith to one or more individual (known as

the trustee) to dispose or value property and apply the benefits arising out of the property for
the advantage of the owner of the property (known as the beneficiaries).
Trust
______ refers to a property of a deceased person or the aggregate of the things possessed by a
person.
Estate
______ refers to an agreement whereby a sum of money is set aside to make provision for
another person.
Settlement
_______ is a scheme by which the enjoyment of an estate under the same deed or will may be
had by persons in succession.
Settlement
_______ is the aggregate of a person‟s possession either in his life time or at death which will
comprise of his personal chattels, goods, money and properties.
An Estate
_______ refers to an individual that is appointed in a will to administer the estate of a person
or appointed by a court where executor refuses to act or the person died intestate.
Executor
________ is an individual appointed by the court to manage the estate of an interstate or of a

testator where an executor has not been appointed or if appointed, does not act.
Administrator
_______ refers to a situation when a person dies and lives no valid will or leaves a will but
has not disposed off all his property by the will, he is said to have died intestate, while the
person who died leaving a will is known as a testator
Intestate
A ______ is the beneficiary or recipient of the legacy bequest in a will.

legatee
A legatee is also referred to as a______.

Devisee
An _____ refers to the recipient of a fixed amount or payment specified in the deed of trust.
Annuitant
A _______ is the transfer of a property for the future use or need of a person which will
comprise of any disposition, covenant, arrangement and agreement
Settlement
A ______ is the individual that creates a trust or settlement either directly or indirectly
Settler
The following deductions are tax exempt

 National Housing Fund Contribution
 National Health Insurance Scheme
 Life Assurance Premium
 National Pension Scheme
 Gratuities
______ is a levy imposed on all companies carrying out their businesses or trades in Nigeria
(resident companies) and those outside Nigeria (non-resident companies).
Company tax
______ is a term employed in describing the estimation used by the relevant tax authority as
the basis of assessment in a circumstance where no financial records exist or returns
submitted by taxpayers to the tax authority.
Best of judgment assessment
______ is a system where a company pays tax by instalment and is allowed by the relevant
tax authority to estimate the company‟s chargeable income and tax payable thereon for a year
of assessment.
Self-assessment of tax payable
The ______ provides that company income tax is levied and payable for each year of
assessment at the rate of thirty kobo for every Naira in respect of a company‟s total profits.
Company Income Tax Act
_______ refers to all issued and fully paid ordinary share as well as preference share capital
Paid up share capital
_______ encompasses all net receipts of goods and services sold in the normal course of
trade or business of the company.
Turnover
______ refers to the foreign currency portion of the ordinary share capital that is brought into
Nigeria from abroad via approved government channels.
Imported equity capital
_______ is the net turnover less the cost of sales reported in the profit or loss accounts.
Gross profit
_______ refers to the total of all assets less all liabilities.

Net asset
______ is deemed to encourage full participation of small companies, business or trade so as

to promote economic prosperity.
Relief
A _____ is an organization whose turnover does not exceed N1,000,000 (one million naira)
per annum.
small company
The tax rate applied to small companies is ______ % on the taxable profit
20
The tax relief for a small company is applied for the first _____ years of the business.
five (5)
_______ is the period for which a taxpayer‟s earned income is assessed to tax, payable to the
relevant tax authority.
Basis period
______ is the period in any year of assessment in which income is being earned by that
entity.
Basis period
_______ refers to the period for which the taxpayer or entity declared a profit or loss in its
accounts.
Accounting Year
A normal accounting year is depicted by

 it must be absolutely 12months
 it must begin instantaneously after the end of the prior accounting year
 it must be the only accounting year ending in the year of assessment
The following encompasses the methods through which a trade or business is assessed to tax:
 First Assessment Year
 Second Assessment Year
 Third Assessment Year
PITA defined an ______ to include a corporation, sole and a body of individuals

individual
______ is the aggregate of a person‟s possession either in his life time or at death which will
comprise of his personal chattels, goods, money and properties.
An estate
_______ refers to an individual that is appointed in a will to administer the estate of a person
or appointed by a court where executor refuses to act or the person died intestate.
Executor
An ______ refers to the recipient of a fixed amount or payment specified in the deed of trust.
Annuitant
The individual that creates a trust or settlement either directly or indirectly is called a ______
Settler
______ is used to describe the relation that subsists between two or more persons carrying on
a business or trade with a view to making profit.
Partnership
______ is granted to every taxpayer who earns income irrespective of his/her age.
Personal Allowance
______ is an allowance granted to a taxpayer who is incapacitated with special equipment

and services of an attendant in the course of his paid occupation.
Disabled person allowance
_______ is an allowance given to every married man up to 1991 assessment year.

Wife allowance
______ is granted to any taxpayer who on the first day of the preceding year maintained a
natural offspring or an adopted child.
Children allowance
_____ are charges that do not relate to any income but allowed as deductions in arriving at
the chargeable income of an individual taxpayer.
General charges
_______ is an indirect tax on goods and services.

Value Added Tax
______ is imposed on the sale of goods and services and imported goods and services.
Value Added Tax
A person entitled to the income of a deceased could be called_______

Beneficiary
For a sole trader to be assessed to tax, he must have been in business for_____ years
Three
_____ occurs when a basis period is common to more than one year of assessment.
Overlapping basis period
Shops, Kiosks rates, tenant rates etc are levies collected by______
Local Government
A tax is productive, when it brings _____ to the government.

Revenue
Taxation in Nigeria was introduced in the year_____

1904
______ is defined as a scheme whereby tax on employee's income is deducted at source by

the employer
Pay As You Earn
______ is the difference between taxable profits and the expected normal profit.
Excess profit
_______ ratio is used in ascertaining the amount of capital allowance to be allowed .

Depreciation relief ratio
Income tax liability is _____ percent on total profits

35
Value added tax, stamp duties, exercise duties, etc are examples of_______
Indirect tax
Taxation started in 1904 and was introduced by_______

Lord Lugard
A form of tax where the tax payable decreases as the tax payers income increase is known
as_______
Regressive tax
______is granted when a company carrying on a trade or business obtains a consideration in
acquiring new assets of the same class as the old ones
Roll over relief
_______ is a type of allowance that arises where a qualifying capital expenditure is disposed
off
Balancing adjustment
Fixed assets are categorised as capital expenditure because they qualify for the grant
of_______
Capital allowance
________ is used by the tax Authority to any tax payer who had fully paid the assessed tax in
the last three consecutive years immediately preceding the current year of assessment
Tax clearance certificate
_______ is a business organisation where two or more persons pool their resources together
with the view of making profit
Partnership
The property of a deceased person is known as________

Estate
A form of tax that increases as income increases is called_______

Progressive tax
In determining the tax liabilities of partners, the use of _______ are employed
Graduated tax rates
______ is a method of collecting tax from subsistent farmers, roadside mechanics,
vulcanizers
Direct assessment
_______ is defined as a scheme whereby tax on employees' income is deducted at source by

the employer and remitted to the relevant tax authority within 14-days after the end of the
month
PAYE
The following are the functions of the Value Added Tax Technical Committee in Nigeria:
(i) To advise the FIRS on its duties in administering the VAT
(ii) To attend to such other matters as the FIRS may from time to time refer to it
(iii) To consider all the tax matters that demand professional and technical expertise and
make recommendations to the FIRS
The Value Added Tax Technical Committee in Nigeria which encompasses the following:
(i) A Chairman, who shall be the Chairman of the Federal Board of Inland Revenue
(ii) All Directors in the Federal Inland Revenue Service
(iii) A Director in the Nigeria Customs Service
(iv) Three representatives of the State Governments shall be members of the Joint Tax Board
______ refers to the amount paid to the tax authorities which reflects the difference between
the total VAT collected from customers on sales.
Output VAT
_______ is a VAT made by a person or individual who shall reimburse the supplier, the VAT
on vatable goods and services purchased by or supplied to him.
Input VAT
The VAT rate is computed at ______ of the value of all Vatable goods and services apart
from those exempted by the VAT Act.
5%
The following are goods exempted from VAT

(i) All medical and pharmaceutical products
(ii) Basic food items
(iii) Books and educational materials
(iv) Baby products
(v) Fertilizers locally produced, agricultural and veterinary medicine
(vi) All exports
(vii) Plant and machinery imported for use in the Export Processing Zone
(viii) Plant, machinery and equipment purchased for utilization of gas in downstream
petroleum operations.
(ix) Tractors, ploughs, agricultural equipment purchased for agricultural purposes
VAT is established by the Value Added Tax Act Cap VI, ______LFN.
2004
_______ is an indirect tax on goods and services.

Value Added Tax
______ is a general consumption expenditure tailored with the sole aim of raising revenue for
the government of the country.
Value Added Tax
_______ is imposed on the sale of goods and services and imported goods and services.
VAT
______ is collected at each stage of the production and distribution chain, thus, the burden
rest on the final consumer of the goods or services resulting from the production and
distribution chain.
VAT
The _____ principle allows losses to be carried forward to subsequent years and relieved only
from the profit of the same source the loss was incurred.
carry forward loss relief
The ______ principle allows losses to be relieved against prior year profit.
current year loss relief
The _______ principles holds that where a loss is taken into cognizance in the determination
of assessable profit in any year of assessment, such loss is deemed to be effectively relieved
to the extent of the profit available.
effective loss relief
______ are charges that do not relate to any income but allowed as deductions in arriving at
the chargeable income of an individual taxpayer.
General charges
The general charges comprise of the following:

(i) Professional subscription (e.g. ICAN, ANAN)
(ii) Mortgage loan interest i.e. annual interest on loan for an owner-occupier residential house
(iii) Alimony payment made by a husband to his divorced wife
______ in research and development with effect from 1987 is allowed to claim as a relief, the
amount of his equity holding in a company floated exclusively for research purposes or 25%
of his total income whichever is lower.
Equity participation
Equity participation in research and development with effect from _____ is allowed to claim
as a relief, the amount of his equity holding in a company floated exclusively for research
purposes or 25% of his total income whichever is lower.
1987
______ is granted in respect of life assurance premium paid by an individual during the
preceding year of assessment for himself or for his spouse.
Life assurance allowance
______ connotes the financial year of a company during which tax is charged.
Year of assessment
______ is granted to any taxpayer who on the first day of the preceding year maintained a
natural offspring or an adopted child.
Children allowance
_______ is an allowance given to every married man up to 1991 assessment year.

Wife allowance
_______ is an allowance granted to a taxpayer who is incapacitated with special equipment

and services of an attendant in the course of his paid occupation.
Disabled person allowance
_______ allowance is calculated on earned income and is granted to both residents and non-
residents.
Personal allowance
______ are situations where a partnership can be engaged in merger or amalgamation.

Merger or amalgamation of partnerships
Where there is a _____or amalgamation, the older partnership will not be deemed to have
ceased business or trade and the new partnership will not be deemed to have commenced a
new trade or business.
merger
Where there is a merger or______, the older partnership will not be deemed to have ceased
business or trade and the new partnership will not be deemed to have commenced a new trade
or business.
amalgamation
A ______ may arise as a result of admission of a new partners or retirement of a partners.

change in the composition of partnership
When there is a______, the adjusted profit would be the divisible income.
change in the composition of partnership
When there is a ______ in the composition of partnership, the adjusted profit would be the
divisible income.
change
When there is a change in the ______of partnership, the adjusted profit would be the divisible
income.
composition
When there is a change in the composition of_____, the adjusted profit would be the divisible
income.
partnership
When there is a change in the composition of partnership, the adjusted profit would be the
divisible______.
income
The new partnership will be assessed using the ______rule

commencement
The new partnership will be assessed using the _____

commencement rule
In the case of______, the accounts of the partnership will be prepared based on accounting
rules and principles and the accounts will be adjusted for the purpose of tax using the
“determination of divisible income”.
ongoing partnership trade or business
The determination of divisible income under partnership is premised on ______ fold

two
In a scenario where a partner sustains a loss due to the loss sustained by the partnership, such
a loss is available for______.
relief
______ income is calculated like the income of a sole proprietor.
Partnership
Partnership income is calculated like the income of a sole______.

proprietor
Partnership income is calculated like the income of a sole proprietor.

True
______ income arrived at after allowable deductions is apportioned to each of the partners in
accordance with the agreed ratio.
Partnership
PITA stands for_____

Personal Income Tax Act
The _____ or executor may make discretionary payments to the beneficiaries.

trustee
The trustee or _____ may make discretionary payments to the beneficiaries.

executor
The trustee or executor may make discretionary payments to the_____.

beneficiaries
The trustee or executor may make _____ payments to the beneficiaries.

discretionary
The trustee or executor may make discretionary ______to the beneficiaries.

payments
_______ are a form of normalized depreciation granted on certain specified qualifying capital
expenditure under the Nigerian tax laws.
Capital allowances
_______ is an allowance granted to an entity or taxpayer for incurring and using qualifying
capital expenditure during a year of assessment for the purpose of deriving its income.
Capital allowance
In principle, the income of a trust will comprise of any income earned in, derived from,
received in or brought into Nigeria. Such income of a trust is referred to as ______
Computed income
The term ______ is used to refer to a conveyance or transfer of property to some individuals
known as “trustee or executors”
trust
The term trust is used to refer to a conveyance or transfer of property to some individuals
known as_______
trustee or executors
In reality, a _____ is established either by a „will‟, „court order‟ or a „deed of trust‟.

trust
A _____ is a written document that stipulates the operations of a trust.

deed of trust
A deed of trust is_______

a written document that stipulates the operations of a trust
A______ is defined to include an executor, trustee, company, partnership, community, family

and individual.
person
_______ relates to a circumstance where a trade or business ceases to exist.

Cessation rule
______ is the first day of the year to the last day of the same year in which the organization
completely ceased to trade or engage in business.
Ultimate (final year)
PYB stands for______

Preceding Year Basis
The following encompasses the methods through which a trade or business is assessed to tax:
a) First Assessment Year
b) Second Assessment Year
c) Third Assessment Year
______ of a body of persons or an entity is the accounting year of the entity or body of
persons.
Basis period
______ is that period for which the taxpayer‟s income is charged to tax by the relevant tax
authority.
Basis period
The term _____ refers to the period for which the taxpayer or entity declared a profit or loss
in its accounts.
Accounting Year
A normal accounting year is depicted by:

 it must be absolutely 12months
 it must begin instantaneously after the end of the prior accounting year.
 it must be the only accounting year ending in the year of assessment
Basis period is the period for which a ______ earned income is assessed to tax, payable to the
relevant tax authority.
taxpayer’s
In principle, _____ entities usually have diverse accounting or fiscal year where they prepare
their accounts.
corporate
In principle, ______usually have diverse accounting or fiscal year where they prepare their
accounts.
corporate entities
In principle, corporate entities usually have diverse ______or fiscal year where they prepare
their accounts.
accounting
In principle, corporate entities usually have diverse accounting or ______where they prepare
their accounts.
fiscal year
Minimum tax computation is not applicable to the following companies:

(a) a company carrying on agricultural trade or business
(b) a company with at least 25% imported equity capital
(c) a company within its first four calendar years of commencement of trade
The ______ is payable either where there is no chargeable profit or the chargeable profit
results in no tax payable or the tax payable is less than the minimum tax
minimum tax for small companies
A _____ is an organization whose turnover does not exceed N1,000,000 (one million naira)
per annum.
small company
A company is regarded as ______if it fulfills the above criterion.

small
A company is regarded as small if _____

it fulfills the above criterion
The tax rate applied to small companies is ______ on the taxable profit instead of the 30% of
a normal trade or business.
20%
______ is deemed to encourage full participation of small companies, business or trade so as

to promote economic prosperity.
Relief
ABWA stands for______

Association of Accountancy Bodies in West Africa
______ is computed after adding back, disallowed expenses and deducting allowable
expenses and incomes exempted.
Adjusted profit
Adjusted ______ is computed after adding back, disallowed expenses and deducting
allowable expenses and incomes exempted.
profit
Adjusted profit is computed after adding back, disallowed expenses and deducting allowable
expenses and ______exempted.
incomes
_____ tax rate is 2% of adjusted profit.

Education
_______ is 2% of adjusted profit.

Education tax rate
Education tax rate is ______% of adjusted profit.

2
Education tax rate is 2% of______.

adjusted profit
Education tax rate is 2% of _____ profit.

adjusted
The ______ is premised on the determination of the adjusted and taxable profits.
computation of company income tax
CITA stands for______

The adjustments are generally with respect to the following items:

a) Deductions not Allowed (expenditure liable to tax)
b) Deductions Allowed (expenditures not liable to tax)
c) Items liable to tax but not credited in the profit or loss account
d) Items credited in the statement of comprehensive income but not taxable
______ in respect of residential accommodation occupied by employees of the entity are

allowable up to a ceiling of 100% of the basic salary of employees.
Rental charges
CITA provides ______ % investment tax credit on the qualifying expenditure of companies
and other organizations involved in research and development activities for
commercialization once the expenditure are incurred for that purpose.
20
______ provides 20% investment tax credit on the qualifying expenditure of companies and
other organizations involved in research and development activities for commercialization
once the expenditure are incurred for that purpose.
CITA
The ______ provides that company income tax is levied and payable for each year of
assessment at the rate of thirty kobo for every Naira in respect of a company‟s total profits.
______ makes provision for the currency of assessment of tax payable by a company as
contained under section 54.
CITA
CITA makes provision for the ______ of tax payable by a company as contained under
section 54.
currency of assessment
CITA makes provision for the currency of assessment of tax payable by a company as
contained under section_____.
54
______of tax payable is a system where a company pays tax by instalment and is allowed by
the relevant tax authority to estimate the company‟s chargeable income and tax payable
thereon for a year of assessment.
Self-assessment
______ of tax payable is provided for under section 53 of the Company Income Tax Act
(CITA), 2011.
Self-assessment
______ is a levy imposed on all companies carrying out their businesses or trades in Nigeria
(resident companies) and those outside Nigeria (non-resident companies).
Company tax or company income tax
CAMA stands for______

Companies and Allied Matters Act
______ is established by the Companies Income Tax Act (CITA) CAP C21 2004 LFN for
both resident and non-resident companies in Nigeria.
Company Tax
Company Tax is established by the_____ CAP C21 2004 LFN for both resident and non-
resident companies in Nigeria.
Companies Income Tax Act
A ______ is one whose operations are carried and managed and is liable to Nigerian tax law.
resident company
A ______ is one whose portion of its income is obtainable in Nigeria and is liable to any such
laws in force in any given country outside Nigeria.
non-resident company
Company tax is controlled and managed by the _____ through various large tax offices and
incorporated tax offices.
FIRS stands for______

_______ are taxed on the basis on certain expenditure in determining whether they are
incurred wholly, exclusively, necessarily or reasonably in earning the income.
Companies
Companies are ______ on the basis on certain expenditure in determining whether they are
incurred wholly, exclusively, necessarily or reasonably in earning the income.
taxed
Companies are taxed on the basis on certain _____ in determining whether they are incurred
wholly, exclusively, necessarily or reasonably in earning the income.
expenditure
An _____ against the inclusion of an income of settlement, trust or estate in an assessment to

tax by any tax authority is established by the appeal provisions of the income tax laws of the
territory to the tax authority of which the trustee or executor is answerable for the relevant
year of assessment.
appeal
______ shall be granted to any settlement, trust or estate that the income includes any income
which has suffered tax in Nigeria or outside Nigeria.
Double taxation relief
The basis of tax assessment under trusts, settlements and estates is on ________.
Preceding year basis
The charge on gains made from the disposal of a chargeable asset is called ______
Capital gains tax
_______ has the right of election in a company when there is a change in accounting date
The tax authority
Those expenses incurred by an employer in the provision of benefits to the employees are
known as ________.
Benefits in kind
State if bad debts written off is an allowable deduction or a non allowable deduction
Allowable deduction
________ assessment may be employed by the relevant tax authority in circumstances where
the financial records are seen to be unreliable
Best of judgement
Tenement rates are collected by_______

Local Government
______ income connotes trade, business, vocation and employment

Earned
______ tax authority collects pools betting, lotteries and casino taxes
State Government
_______refers to an agreement whereby a sum of money is set aside to make provision for
another person
Settlement
A non resident individual is one who is not_____ in Nigeria

Domiciled
If after the cessation of business any unrelieved losses are termed_______

Terminal losses
The tax relief for small companies or business or trade is applicable for the first_____ years
of the business or trade.
5
The maximum allowable deduction for donations in ascertaining the profit of a company
is_____ percent of the profit before deducting the donation
10
If the net profit of Susu is N500,000, depreciation is N250,000 and loss on disposal is
N150,000. What is the adjusted profit of Susu for the period?
N900,000
An ______ is an individual appointed by the will to manage the estate of the deceased
Executor
_______ assessment is raised by the board when a taxpayer has been under assessed
Additional
Signboard and advertisement permit fees is collected by_______

Local government
______ shall be granted to any settlement, trust or estate that the income includes any income
which has suffered tax in Nigeria or outside Nigeria.
Double Taxation Relief
If the turnover of a small company is N900,000; the adjusted profit 443,,000 and capital
allowance is N297,500. Determine the tax liability of the company.
N29,100
Individuals other than those engaged in agricultural business can carry forward losses
up______ years of assessment
4
______ are charges that do not relate to any income but allowed as deduction in arriving at
the chargeable income of an individual tax payer
General charges
Non oil export under value added tax is an example of ______ goods and services
Zero-rated
_______ are taxes on documents and not on transactions or persons

Stamp duties
When a business commences operation, the basis period for assessable profit in the first year
of commencement is on______ basis
Actual year
The acronym for the scheme in which tax is deducted from the income of an employee at
source is:______
PAYE
The list of taxable persons assessed to income tax under Personal income tax act is
called_______
Assessment list
Value added tax rate is computed at _____ of the value of all vatable goods and services
5 percent
______ refers to income from all sources other than those gotten from employment business
or reward for services rendered.
Unearned income
Where investment incomes are received net of withholding tax, they are termed_______
Franked investment income
______ VAT refers to the amount paid to the tax authorities which reflects the difference
between the total VAT collected from customers on sale.
Output
______VAT is made by a person or individual who shall reimburse the supplier the VAT on
Vatable goods and services purchased by or supplied to him.
Input
In conversion of partnership into a limited liability company________ rules should be
applied.
Cessation
The basis period for the second year on commencement of business is profits of the
first______ months of trading.
12
An individual who earns daily wages is an_______

Itinerant worker
One of the objectives/purposes/uses of taxation is to discourage the consumption of______

products.
Dangerous products
Under the cannons/principles of taxation the principle of economy relates to ______ of

administering tax.
Cost
_______ is levied on all companies at the rate of 2 percent of their assessable profits.
Tertiary Education Tax
_______ implements the decisions of the Joint Tax Board (JTB) and advices the JTB and the
State local government on revenue matters.
State Joint Revenue Committee
______ advices the local government on tax related matters

Local government revenue committee
Where there is a merger of partnerships, the older partnership, will not______ business.
Cease
One disadvantage of indirect tax is that while direct taxes can be made progressive, indirect
taxes are ______
Regressive
_______ assessment is normally used for non–resident companies.

Turnover
For the purpose of determining adjusted profit, deduction of revenue expenditure must be
wholly,______ necessarily and reasonably incurred.
Exclusively
______ advices Federal Inland Revenue Service (FIRS) on its duties in administering the
VAT.
Value added tax technical committee
_______ makes recommendations, where appropriate to the Joint Tax Board on tax policies,
tax reforms, tax legislation, tax treaties and exemption as may be required from time to time.
State Inland Revenue Service Board
If the price of a carton of Wine sold is N1,800 and VAT is levied at 5 percent, calculate the
VAT payable on 20,000 cartons of wine.
N1,800,000
The individual that creates settlements a trust or settlement either directly or indirectly is
a______.
Settler
Musa earns dividend of N1,100,000 in 2017, N1,200,000 in 2018 and N1,500,000 in 2019.
What is the amount of dividend assessable to tax in 2018 Tax year?
N1,100,000
The foreign currency portion of the ordinary share capital that is brought into Nigeria from
abroad through approved government channels is called______
Imported equity capital
From the following taxes, which is indirect tax?

Value added tax
If the assessable profit of a company is N3,000,000 and capital allowance is N500,000. What
is the company‟s tax liability?
N750,000
The assessable profit of a company is N900,000. Calculate the tertiary education tax
N18,000
Mr. Best received gross dividend of N200,000 and N800,000 for 2018 and 2019 years of
assessment respectively. Determine the unearned income for 2019 tax year.
N200,000
______ is an example of deductions allowed from the profits of companies

Specific provision for bad debt
Who has the right of election in a company on cessation of business?

The tax authority
Where a person dies and leaves a valid will, the person died______
Testate
Donation made to one of the following research institutions are not allowable deductions
Christian Association of Nigeria
Which of the following is not needed in the computation of tax liability in a small company?
Turnover
Which of the following is not a tax exempt income?

Dividend
The provision of Personal income tax act (PITA) requires a penalty of______ percent of tax
not deducted plus interest for failure to deduct tax
10
An obligation given in faith to one or more individuals to dispose property and apply the
benefits in favour of the owners of the property refers to_____
Trust
The imposition of tax, penalty and fines by legal authority can be referred to as_____
Levy
Where the increase in income results in the increase of tax rate, it is called ______
Progressive tax
The tax authority‟s consideration of a person‟s ability to pay tax is a function of the principle
of _______
Equity
Personal income tax, capital gains tax and company income tax are all examples of_______
Direct tax
Monetary charge imposed by the government on persons, entities or property to yield revenue
can be referred to as______
Taxation
If a tax of N30 is imposed on a loaf of bread making a total of N90,000 for 3,000 loaves of
bread sold by YumYum bakery. What type of tax is this?
Specific tax
Given computed income of N28,000,000; discretionary payments of N8,000,000; Specific

payment of N18,000,000. What is the excess apportionment?
N2,000,000
Which of the following is a tax exempt income?

Gratuities
Donations made to one of the following research institutions are not allowable deductions.
Nigeria institute of international trade
Legal expenses not allowed as deductions for the purpose of ascertaining the income of an
individual include _______.
Renewal of a long lease
The assessment of income from Trusts, settlements and estates is governed by the provisions
of ______
Personal income tax act (PITA)
Minimum tax computation is not applicable to the following companies EXCEPT
A company carrying on manufacturing business
Wizzy Nig. Ltd has been in business for some time now. In 2018, turnover was N950,000.
Adjusted profit N780,000 and capital allowance N500,000. What is the Taxable profit?
N280,000
Where turnover is N500,000 and below, minimum tax is the highest of any of the following
EXCEPT______
0.5 percent of paid up share capital
If the total profit of a company is N10,000,000 and adjusted profit is N4,000,000. Calculate
the Tertiary education tax for the relevant year
N80,000
If the net profit as per account of Edo enterprises is N4,000,000. Depreciation is N800,000
and loss on disposal of non current assets is N300,000. What is the adjusted profit of the
business for the period?
N5,100,000
If the earned income of Alhaji Jigawa is N7,000,000 for 2019 tax year. His life assurance
premium is N480,000 p.a; National pension scheme is N800,000; National health insurance
scheme N1,200,000 and National housing fund contribution is N720,000. What is Alhaji
Jigawa‟s total income?
N3,800,000
Mrs. Yemisi is an employee of Noun Plc. Noun provided for her exclusive use of a Prado
SUV which cost N14,000,000. Calculate the income derived by Mrs. Yemisi‟s use of the
vehicle.
N700,000
The following benefits to employees are exempted from tax EXCEPT_________.

Provision of a generator for exclusive use of an employee
If the gross income of Mallam Sambo is N8,000,000. Determine his consolidated relief
allowance
N1,800,000
Great Limited commenced business on 1st June, 2018. His assessable profit to 31st May,
2019 is N4,800,000. Determine his assessable income for 2018 tax year.
N2,800,000
On commencement of business, the basis period for the third year of assessment is on______
Preceding year basis
The following are examples of indirect taxes ECEPT

Capital gains tax
The penalty for failing to file returns according to the Personal Income Tax (Amendment)
Act, 2011 for corporate organizations is ______.
N500,000
Welfare funds are allowable under companies income tax Act but limited to the following
institutions EXCEPT;
Nigerian Institute of Trypanosomiasis Research
_______ is an example of services exempted from VAT

Plays and performances conducted by educational learning institutions
When the net profit of ABC Ltd is N2,000,000 is arrived at after deducting Depreciation
800,000, General provision for bad debts 900,000, Repairs of Motor Vehicle 500,000 and
adding profit on sale of non- current assets of 700,000. Calculate the adjusted profit.
N3,000,000
A tax system in which each tax payer pays the same rate or percentage of his income as tax is
_______
Proportional tax
The following are tax exempt items EXCEPT______

Benefits in Kind
A normal accounting year includes the following EXCEPT_____

Commencement of business
The period for which the entity pays its tax on earned income is ________.
Basis Period
A change in the composition of partnership will arise on ______.

Retirement of a partner
Where the objective of taxation is the redistribution of income from the well to do to the less
privileged then the tax is _______.
Progressive
In case of conversion of Partnership to a limited liability company, the _______rules will

apply.
Cessation
What is the benefit in kind of Shehu Usman if the employer provided him with an asset
which cost N2,500,000?
N125,000
The incentive bonus available to a tax payer for early filing of self-assessment returns
is_______
1% of tax payable
The actual year basis (AYB) of assessment on commencement of business starts from
_______.
1st January to 31st December of that year
The notice of Objection by a taxpayer must be given within_____ from the date of service of
the assessment on the tax payer
30 days
Where a certain amount of tax is levied on each unit of a commodity produced or sold
is______
Specific tax
Tertiary Education tax is collect by______
The Federal Government
The type of assessment normally used for non resident companies is _______
Turnover Assessment
The assessment which involves the taxpayer preparing his account before due date together
with the payment of the tax liability is_______
Self- Assessment
When the tax burden is borne by the tax payer, it is_______

Direct tax
A tax system in which the rate of tax decreases as the income of the taxpayer increases
is________
Regressive Tax system
The duty to advice the federal government with respect to double taxation arrangement with
any country is vested on______
The Joint tax board (JTB)
Tertiary education tax is levied on all companies at the rate of _____ of assessable profits
0.02
The principle of tax that stipulates that the time, mode and amount to be paid should be clear
to the tax payer is ______
Principle of certainty
Define settlement_____
Agreement whereby a sum of money is set aside to make provision for another person
Who among these persons tax is to be collected?

Every individual other than persons, corporations deemed to be resident for that year
in the relevant state under the provision of PITA
Which of these is NOT deductions not allowed

Rent and rates
Which of these is allowable deductions?

Rent and rates
What is an unearned income?
This connotes rents, dividends, royalty, discounts which may be received net of
withholding tax
Which of the taxation canons stipulates time, mode and amount to be paid by taxpayer?
Which of these taxation canons is in respect of timing and mode of payment?

Principle of convenience
Which of these is NOT a canon of taxation?

Principle of trustee
Which of these is an objective of taxation?

To discourage the consumption of dangerous product
Which of this is a type of indirect tax?

Ad varolem
All these are examples of indirect taxes EXCEPT

Personal income tax
Which of these type of tax is sometime referred to as expenditure taxes?

Indirect
When taxes are imposed directly on the income of individual and companies is _____
Direct
One of these tax classification allow poor man to pay tax at a higher rate
Regressive
Which of these classifies rate of tax decreases as the income of the taxpayer increases?
Regressive
Which of this is allowable deductions?

Rent and rates

withholding tax
Define earned income_____

Income derived from a trade carried on by a person and a pension derived by him in
respect of any previous income
Who is an itinerant worker?

An individual who works in more than one place in Nigeria and earn daily wages
What is a place of residence?
Is that which is available for domestic use of an individual in Nigeria on the first day in
a relevant tax year
Define settlement
Agreement whereby a sum of money is set aside to make provision for another person
Who among these persons tax is to be collected?

Every individual other than persons, corporations deemed to be resident for that year
in the relevant state under the provision of PITA
Which of these is NOT deductions not allowed?

Rent and rates

withholding tax
Which of the taxation canons stipulates time, mode and amount to be paid by taxpayer?
Which of these taxation canons is in respect of timing and mode of payment?

Principle of convenience
Which of these is NOT a canon of taxation?

Principle of trustee
Which of these is an objective of taxation?

To discourage the consumption of dangerous product
Which of this is a type of indirect tax?

Ad varolem
All these are examples of indirect taxes EXCEPT

Personal income tax
Which of these type of tax is sometime referred to as expenditure taxes?

Indirect
When taxes are imposed directly on the income of individual and companies is ______
Direct

withholding tax
When is income tax to be paid from sources outside Nigeria?

Monthly
What is the time limit for filing of tax return of newly incorporated company?
18 months
One of these is the annual return to be filed by any company

Signed audited financial statement of the company
How much is penalty for late filing of tax returns?

N25,000
Which of these is NOT disadvantage of indirect tax?

Wider tax base
Which of these is advantage of indirect tax?

Wider tax base
One of these is disadvantage of direct tax

inconvenient
One of these is not an advantage of direct tax

inconvenient
At what rate is an income tax levied on all eligible taxpayers in Nigeria?

0.2
In Nigeria, at what rate is proportional tax charged on companies income profit?

0.3
Nigerian taxes can be classified in any of these except

inclusive
Which tax income engaged in petroleum operations?

Petroleum profit tax
Which of the tax laws allows payment on the income of individuals‟ governor by income tax
management?
Personal Income Tax Act
Which of these is not an enabling tax laws of the Federation of Nigeria?

Companies and Allied Matters Act
When was the Petroleum Profit Tax Act enacted?

1959
When was the direct tax ordinance enacted?

1940
How many tax authorities do we have in Nigeria?

3
Imported equity capital tax______
Foreign currency portion of the ordinary share capital that is brought into Nigeria from
abroad via approved channel
______ explains turnover with company tax

Net receipts of goods and services sold in the normal course of trade of the company
______ defined paid up share capital

Issued and fully paid ordinary share as well as preference share capital
CITA provides for deductions allowed from profits of companies______ incurred production
of those profit
Wholly, exclusively, necessarily, and reasonably
The individual that creates a trust either directly or indirectly is______

Settler
______ is the aggregate of a person‟s possession either in his time or at death which will
comprise of his personal property
Estate
____ is referred to an individual that is appointed in a will to administer the estate of a person
by a court where executor refuses to act.
Executor
A ____ of residence is that which is available for domestic use of an individual in Nigerian
on the first day in a relevant tax year
Place
_______ person pays tax on the quantum of his/her income obtained in Nigeria
Non-resident tax payer
A ____ is assessable to tax on his global income

Resident taxpayer
The term BIK is referred to as_____

Benefit In Kind
_____ taxes are imposed on the taxpayers or corporations or entitles

Company income
______ is a levy imposed by the government of a country on its citizens, individual as the
taxpayer
Income tax
Personal income tax was amended last in Nigeria in_____ year

2011
Taxation of employees and sole proprietors is _____
Personal income tax
______ are levies collected by local government

Shops and kiosks rate
_______ is the full meaning of PAYE

Pay As You Earn
_______ taxes are imposed on goods and services

Indirect
A ______ tax is imposed directly on the income of individuals and companies

Direct
A ______tax is the opposite of a progressive tax

Regressive
_______ tax is one in which rate of tax increases as the income of the taxpayer increases
Progressive
When taxpayer pays the same rate or percentage of his income is known as______ tax
Proportional
The functions of Local Government Revenue Committee does not include _____
Assess and explore personal income tax
______ is Not one of the power and duties of JTB

Exercising power issued by the federal government
_______ is the chairman of the Federal Inland Revenue Service who is also the chairman of
the Joint Tax Board
Joint Tax Board Chairman
______decree established State Inland Revenue Personal Income Tax

1993
_____ and_____ is a technical committee of FIRSB

Legal adviser and secretary
____ is a tax on income of companies engaged in petroleum operations in Nigeria

Petroleum profit tax
____tax is payment on the income of individual and trustees

Personal income tax
____ Act was of taxation was enacted in 1979

Capital transfer tax
Capital transfer tax Act was of taxation was enacted in ______
1979
When was the Stamp Duties Act enacted by Nigerian federal government?
1959
The Petroleum Profit Tax Act was enacted by the federal government in what year?
1959
The federal government enacted the Personal Income Tax Act in what year for the federal
territory of Lagos
1961
Which of these ordinances incorporated the native revenue of 1928?

Coherent
______ was used in Nigeria during the colonial administration by kings to collect tax
Tributes
______ advocates that the system should not discriminate between tax payer
Principle of impartiality
______ identifies that the yield of a tax should be adequate to cover government expenditure
by promoting economic growth and development
Principle of productivity
A canon of taxation that relates with cost of administering tax is _____

Principle of economy
A person entitled to the income of a deceased could be called______

Beneficiary
The acronym WREN stands for_____

Wholly, Reasonably, Excusively, Necessarily
For a sole trader to be assessed to tax, he must have in business for______ years.
3
The methods of obtaining loss relief are current year and _____ loss relief systems.
Carry Forward
______ profit is assessed using the preceeding year bases

Adjusted Profit
Shops, Kiosks rates, tenant rates etc are levies collected by______
Local Government
An incorporated company is expected to register with the FBIR within_____ months after
incorporation.
18
Which tax laws imposes tax on gains arising from disposal of chargeable assets listed in the
Act?
Capita Gains Tax
A tax is productive, when it brings______ to the government.

Revenue
A system of that assess tax payer's on a fixed percentage is known as_______

Proportional Tax system
Taxation in Nigeria was introduced in_____ year

1904
A form of tax assessable directly on the tax payers who is required to pay tax on his property
income etc is called______
Direct Tax
The normal basis period does not apply in______ because there will be no profit
New Business
Fixed assets qualify for the grant of______ because they are categorised as capital
expenditure
Capital Allowance
______ is defined as a scheme whereby tax on employee's income is deducted at source by

the employer.
Pay As You Earn
_______ is the difference between taxable profits and the expected normal profit.
Excess profit
When a person dies and leaves no valid will or leaves a will but has not disposed off his
property by the will, is called______
Intestate
______ is a person receiving an annuity that may be charged on the income of an estate
Annuitant
A ______ is a person to whom a legacy is bequeated or receiving a specific bequest from an

estate
Legatee
Capital Allowance for construction companies are ______ according to the degree of work
done
Pro rated
Double taxation relief is an international treaty set up by the______ for the avoidance of
double taxation.
United Nations
_______ ratio is used in ascertaining the amount of capital allowance to be allowed

Depreciation relief ratio
Income tax liability is_____ percent on total profits .

35
Banks in Nigeria are encouraged to grant agricultural loans to farmers at______ interest rates.
Low
Value added tax, stamp duties, exercise duties, etc are examples of______
Indirect tax
_______ is a system of raising money for the purposes of governance from individual persons
or corporate bodies
Taxation
Taxation started in 1904 and was introduced by______

Lord Lugard
A form of tax where the tax payable decreases as the tax payers income increase is known
as______
Regressive Tax
______ tax replaced sales tax. It is imposed on the supply of goods and services by business
Value Added Tax
______ is used as an instrument of economic regulation for purpose of discouraging or

encouraging certain forms of social behaviour
Tax
The organs of tax administration that advices Federal Government on request in respect of
double taxation arrangement with any other country is_______
Joint Tax Board
A taxable person is expected to register with the relevant tax authority within ______months
3
An incorporated company is expected to register with the FBIR with _____ months after
incorporation
18
______ is granted when a company carrying on a trade or business obtains a consideration in

acquiring new assets of the same class as the old ones
Roll over relief
The normal basis period does not apply in_______ because there will be no profit of the
preceeding accounting period from which the assessment is derived
New Business
The preceeding year basis of assessment implies that the profits that will be assessed to tax in
the year 2009, will be the profit of the year______
2008
Where losses occurred in a business, assessment of tax interest is_______

Nil
_______ is a type of allowance that arises where a qualifying capital expenditure is disposed
off
Balancing Adjustment
Fixed assets are categorised as capital expenditure because they qualify for the grant
of______
Capital Allowance
_______ occurs when a basis period is common to more than one year of assessment
Overlapping basis period
For a sole trader to be assessed to tax, he must have been in business for at least______ years
from the date of commencement
3
Housing allowance has been reviewed upward since 2001 and excess of it is regarded
as______ and it is taxable
Benefits - in – kind
The general notion by some individuals that those who earns income of N30,000 and below
are tax exempted
True
______ is a method of collecting tax from subsistent farmers, roadside machanics,

vulcanizers etc
Direct Assessment
A person entitled to the income of a deceased person could be called the following except
Settler
The taxable profit of any company are those in respect of the following except
Wages
In determining the tax liabilities of partners, the use of _______ are employed
Graduated Tax Ratio
______ is used by the tax Authority to any tax payer who had fully paid the assessed tax in
the last three consecutive years immediately preceeding the current year of assessment
Tax Clearance Certificate
The income of a partner in a partnership is gotten by computing the below except

Shares
______ is a business organisation where two or more persons pool their resources together
with the view of making profit
Partnership
Any interest earned by banks on loans granted for______ purposes is exempted from tax
Agricultural
Who is saddled with the responsibility of preparation of accounts of a settlement or trust?

Trustee
______ is a person appointed by the court to administer the entire possession of an interest
Administrator
An interest earned by banks on loans granted for_______ purposes is exempted from tax
Petroleum exploration
The property of a deceased person is known as______

Estate
Value added tax, stamp duties, exercise duties, etc are examples of_______
Indirect tax
A form of tax assessable directly to the payer who is required to pay tax on his property,
income or profit wtc is called_______
Direct Tax
A form of tax that increases as income increases is called______

Progressive Tax
In determining the tax liabilities of partners, the use of _________ are employed
Graduated tax rates
________ is defined as a scheme whereby tax on employees' income is deducted at source by

the employer and remitted to the relevant tax authority within 14days after the end of the
month.
PAYE
My interest earned by banks on loans granted for ______ purposes is exempted from tax
Mining
Who is Saddled with the responsibility of preparation of accounts of a settlement or trust?

Trustee
_____ is a person appointed by the court to administer the entire possession of an intestate or
an intestator where an executor has not been appointed
Administrator
The process of ascertaining the profits of a company for a given period stars by the
preparation of ______ in accordance with GAAP and the provisions of CAMA 1990 as
amended
Financial Statement
______ can be defined as the surplus by which the receipts from the trade or business exceed
the expenditure necessary for the purpose of earning those receipts
Profit
The normal basis period does not apply in _________ because there will be no profit of
preceeding accounting period from which the assessment is derived.
New business
The type of an organisation's profit that is associated with using the preceeding year basis is
called _______
Adjusted profit
______ is granted when a company carrying on a trade or business obtains a consideration in

acquiring new assets of the same class as the old ones.
Roll over relief
A type or form of tax that asseses tax payers to pay tax on a fixed percentage is known as
______
Proportional tax system
A form of tax system where both the high income and low income groups are taxed at the
same rate, making the low income earners to saccrifice more than high income earners is
_____ tax
Proportional
______ is a system of raising money for the purposes of governance by means of contribution
from individual persons or corporate bodies
Taxation
The administration of taxes in Nigeria rests on the various group known as ________
Tax Authorities
A form of tax where the tax payable decreases as the tax payer's income increases is known
as _______
Regressive tax
_____ is used as an instrument of economic regulation for the purpose of discouraging or

encouraging certain forms of social behaviour
Tax
_____ is used to describe the imposition by a legal authority of tax, penalties and fines.
Levy
Taxation in Nigeria started in 1904 and was introduced by _______

Lord Lugard

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ACC201 - TAXATION 1 SUMMARY

All levels of government need funds to finance their activities.

All levels of government need _______ to finance their activities.

A ______ is a compulsory payment.

A tax is a compulsory payment.

A tax is a ______ payment.

A _______ is the levy by public authorities with a tax jurisdiction, of compulsory

A _______ is a compulsory payment made by individuals and organizations to the

______ generated from taxation is usually used for developmental purposes.

Revenue generated from _______ is usually used for developmental purposes.

Revenue generated from taxation is usually used for _____ purposes.

Tax is imposed for the following reasons

The following are the canons/principles of taxation

A good tax system should be equitable in the distribution of tax burden.

Principle of ______ is in respect of timing and mode of payment.

A good tax system should be coherent, simple and______.

There are ______ tax authorities in Nigeria

Broadly, there are three (3) tax authorities, namely:

Lord Luggard introduced income tax in Nigeria in the year______

The Direct Taxation Ordinance No. 4 was enacted in ______

Nigeria became a _____in 1954 under the Macpherson constitution

Nigeria became a federation in _______ under the Macpherson constitution

Nigeria became a federation in 1954 under the _______constitution

The Eastern Region enacted its Finance Law No. 1 of in ______

LFN is an acronym for______

________ is payment on the income of individuals, partnerships, executors and trustees.

_______ is a tax on income of companies engaged in petroleum operations.

_______ charges duties on specified instruments listed in the Act.

The current rate of Companies Income Tax is _____ % of chargeable profit.

VAT stands for______

Value Added Tax (VAT) is charged at ______%.

_______ is levied on all companies at the rate of 2% of their assessable profits.

FIRS is acronym for______

SIRSB stands for______

Functions of the Board (SIRSB)

SJRC is the acronym for______

The following are the functions of SJRC

Nigerian taxes can be classified in any of the following ways:

A _____ tax is the opposite of a progressive tax.

Classification based on Burden, taxes are classified as _______

Taxes imposed on goods and services are

Indirect Taxes are otherwise referred to as_______.

Indirect taxes can be classified as _______

_____ is levied on the value of the product being taxed.

The following are the advantages of direct taxes:

The following are the disadvantages of direct taxes:

The advantages of indirect taxes are as follows

The following are the disadvantages of indirect taxes

The annual return to be filed by any company will include

These are types of Assessment

The advantages of Self-Assessment

An additional assessment cannot be made later than ______ years

_____ is defined as monetary charge imposed by the government on persons, entities or

PIT stand for______

_______ is a levy imposed by the government of a country on its citizens, individual or

Taxes imposed on the taxpayers or corporations or entities is termed _______

Tax imposed on the personal income of an individual taxpayer is termed ______

The term BIK refers to ______

BIK comprised of the following

CBN stands for_____

_______ is an obligation or authorization given in faith to one or more individual (known as