The Finance Business Partners

BLACKOUT PERIODS AND INSIDER TRADING In Nigeria, the term "blackout" typically brings to mind power outages. However, in the financial world, a "blackout period" refers to a specific timeframe during which company insiders, such as executives, directors, and employees, are restricted from buying or selling the company's securities. This measure is designed to prevent insider trading, ensuring that individuals with access to confidential, non-public information do not exploit it for personal gain. This practice helps maintain investor confidence and ensures a level playing field in the market. Blackout periods typically occur during sensitive times when non-public information is accessible to insiders. Common instances include: ? In the weeks leading up to the release of quarterly or annual financial results, companies often impose blackout periods to prevent trading on advanced knowledge of the company's performance. ? When a company is involved in major transactions, such as mergers or acquisitions, blackout periods are enforced to prevent insiders from capitalizing on confidential deal information. ? Significant events like leadership changes, product launches, or strategic shifts can also trigger blackout periods to ensure that insiders do not misuse their access to forthcoming announcements. The duration of blackout periods can vary but often begins several weeks before a scheduled announcement and ends shortly after the information has been made public. For example, a company might impose a blackout period starting two weeks before its earnings release and ending two days after the announcement. A notable scenario happened in April 2024, when Julius Berger Nigeria Plc, a leading construction company, was sanctioned by the Nigerian Exchange (NGX) for engaging in inappropriate insider dealing during a closed period. This means that for finance professionals like us, understanding and adhering to blackout period policies is not only a legal obligation but also a commitment to ethical standards that protect investor confidence and the reputation of our organizations. Do have a wonderful day ahead.

Embracing Life's Opportunities Eric Roth's words, "Our lives are defined by opportunities, even the ones we miss," resonate deeply. This quote inspires us to reflect on our own lives and ask: "Are we seizing every opportunity that comes our way?" In our journey through life, we've encountered numerous opportunities - some we've grasped, while others slipped away. Yet, it's essential to capitalize on as many opportunities as possible, as just one can transform our lives from ordinary to extraordinary. While we can't catch every opportunity, what matters most is our proactive approach. Each opportunity can be a stepping stone to a brighter future, personally and professionally. Let's commit to living in the present, embracing the chances that come our way. As we step into this new week, may our paths be illuminated by the promise of new opportunities. May we walk with hope and determination, knowing great things await us. Have a great week ahead!

Tax Friday Question Company ABC, a Spanish entity, sells its airline to a Nigerian company after its final flight from Spain to Nigeria. Where is Capital Gains Tax (CGT) payable? A. Nigeria B. Spain C. No CGT Applicable Please feel free to share your answers. Do have a great day ahead.

Weekly Anonymous Sharing Today we have a community member seeking your advice on a work place related matter. We look forward to diverse opinion and thoughts on the issue. Thanks in anticipation of your response.

Gather Intelligence As professionals, we're constantly looking for ways to stay ahead of the curve. One key strategy is to gather intelligence. This means going beyond just analyzing data and instead, seeking to understand the underlying trends and motivations that drive our industry. Think about it like this: when you walk into a meeting, you want to be armed with more than just numbers. You want to have insights that can help you anticipate what's coming next and make informed decisions. That's what gathering intelligence is all about. It's not just about crunching numbers or analyzing data. It's about understanding the people, the trends, and the motivations that shape our industry. When you have this kind of intelligence, you can make predictions, identify opportunities, and provide valuable insights to your team and clients. So, let's make a commitment to gather intelligence and stay ahead of the game. Remember, information is power. And when you have the right intelligence, you can make informed decisions that drive real results. Do have a productive week.

Tax Friday Question What WHT rate applies to the winnings of Edwin Koech from Kenya, who participated in the Access Bank Lagos City Marathon in Nigeria? A. 10% B. 15% C. 35% Please feel free to share your answers. Do have a wonderful day ahead.

Tax Implications of Activities in Nigeria’s Free Trade Zones Free trade zones (FTZs) are special economic areas where businesses enjoy minimal regulatory requirements, tax exemptions, and other incentives. These zones are designed to attract foreign and local investments, promote economic growth, and create job opportunities. In Nigeria, free trade zones offer significant benefits for businesses, particularly regarding tax relief. These incentives are aimed at spurring economic development by encouraging the inflow of capital and fostering technology transfer. Tax Benefits for Businesses in Nigeria’s Free Trade Zones 1. Corporate Income Tax Exemption: Businesses in free trade zones are fully exempt from corporate income tax. 2. Dividend Withholding Tax Exemption: Investors in free zone entities are not subject to withholding tax on dividends and can freely repatriate their capital. 3. Duty-Free Importation: Capital goods, machinery, and raw materials can be imported duty-free for business operations. 4. Waiver on Expatriate Quotas: Approved entities can employ as many expatriates as necessary without restrictions. 5. VAT and Withholding Tax (WHT) Exemptions: Purchases from entities in the customs territory (outside the free zone) are exempt from VAT and WHT. 6. VAT Liability for Sales to the Customs Territory: Sales made by free zone businesses to entities in the customs area are subject to VAT, which must be paid by the buyer in the customs territory. 7. Tax Applicability for Unapproved Entities: Any sales or purchases involving unapproved entities in the free zone are subject to applicable taxes, such as VAT and WHT. 8. Filing Tax Returns: Approved free zone entities are required to file tax returns through the free zone authority to the Federal Inland Revenue Service (FIRS) under the Finance Act 2020. 9. PAYE Tax Obligations: Employees of free zone businesses must have Pay As You Earn (PAYE) tax deducted from their salaries and remitted to the relevant tax authority. These provisions highlight the tax structure for entities operating within Nigeria’s free zones. By leveraging these incentives, businesses can achieve cost efficiency while contributing to economic development. We hope you found this insightful. Do have a great day ahead.

Tax Implications of Activities in Nigeria’s Free Trade Zones Free trade zones (FTZs) are special economic areas where businesses enjoy minimal regulatory requirements, tax exemptions, and other incentives. These zones are designed to attract foreign and local investments, promote economic growth, and create job opportunities. In Nigeria, free trade zones offer significant benefits for businesses, particularly regarding tax relief. These incentives are aimed at spurring economic development by encouraging the inflow of capital and fostering technology transfer. Tax Benefits for Businesses in Nigeria’s Free Trade Zones 1. Corporate Income Tax Exemption: Businesses in free trade zones are fully exempt from corporate income tax. 2. Dividend Withholding Tax Exemption: Investors in free zone entities are not subject to withholding tax on dividends and can freely repatriate their capital. 3. Duty-Free Importation: Capital goods, machinery, and raw materials can be imported duty-free for business operations. 4. Waiver on Expatriate Quotas: Approved entities can employ as many expatriates as necessary without restrictions. 5. VAT and Withholding Tax (WHT) Exemptions: Purchases from entities in the customs territory (outside the free zone) are exempt from VAT and WHT. 6. VAT Liability for Sales to the Customs Territory: Sales made by free zone businesses to entities in the customs area are subject to VAT, which must be paid by the buyer in the customs territory. 7. Tax Applicability for Unapproved Entities: Any sales or purchases involving unapproved entities in the free zone are subject to applicable taxes, such as VAT and WHT. 8. Filing Tax Returns: Approved free zone entities are required to file tax returns through the free zone authority to the Federal Inland Revenue Service (FIRS) under the Finance Act 2020. 9. PAYE Tax Obligations: Employees of free zone businesses must have Pay As You Earn (PAYE) tax deducted from their salaries and remitted to the relevant tax authority. These provisions highlight the tax structure for entities operating within Nigeria’s free zones. By leveraging these incentives, businesses can achieve cost efficiency while contributing to economic development. We hope you found this insightful. Do have a great day ahead.

Get it Right the First Time: Be Prepared As finance and accounting professionals, accuracy is everything. One small mistake can have far-reaching consequences. That's why we live by the mantra: "Get it right the first time." Think of a pilot preparing for takeoff. Multiple checks and preparations are made to ensure a safe journey. At 30,000 feet, there's no room for error. Similarly, in our field, financial errors can be catastrophic. So, how do you "get it right"? It starts with preparation: - Doing your homework - Triple-checking calculations - Staying updated on regulations - Anticipating challenges - Continuous learning When you get it right the first time: - You build trust with clients and colleagues - You save time and resources - You set yourself apart as a true professional Excellence isn't about luck; it's about preparation. Let's strive for perfection in everything we do. As you start your week, remember: Be prepared, and success will follow. We wish you all the best this week.

Tax Friday Question Is Company ABC, a Chinese entity with a Nigerian showroom, liable for Nigerian taxes on online sales to Nigerian customers who pay for products and shipping? A. Yes B. No C. Maybe Please feel free to share your answers. Do have a wonderful day ahead.