In a bid to provide tax defaulters an opportunity to defray all unsettled tax liabilities, the Federal Government in Nigeria recently approved the Voluntary Assets Income Declaration Scheme. Under the Scheme, tax defaulters are required to voluntarily disclose any previously undisclosed asset and income relating to the preceding six (6) years of assessment within a nine (9) month period from July 1, 2017. It has been described as giving tax amnesty to defaulters albeit for a limited period.
The objectives of the Scheme include to encourage full tax compliance, discharge of outstanding tax liabilities as well prevent tax evasion. While it increases government revenue, the Tax Payer also benefits from it vide workable tax payment plans, and immunity from prosecution for tax offences and tax audit.
A VAID application is valid where the disclosure is voluntary and substantially verifiable, and the payable tax is assessed by the relevant tax authority. The Scheme is to be implemented across the Federation and is applicable to all taxable persons & entities.