Day 1: Stream 1 PIT Course

I am excited today. To the glory of God, I got an opportunity to do what I have always longed for. Being a facilitator in the Preliminary Inspector of Tax Course of the Federal Inland Revenue Service is a task I have desired to perform over the years in my 14 years in the tax administration. Today, I taught Stream 1 of the Preliminary Inspector of Tax Course, Year 2024 of the Federal Inland Revenue Service. It’s a class of 136 participants, ranging from officers to assistant directors from the establishment. Teaching the course “Examination of Tax Returns” is so dear to me as it is a discourse that is at the heart of tax administration.

Today, being Day 1, I had to lay a foundation that would prepare our officers for their core responsibility of assessing, collecting, enforcing, and accounting for taxes collected accordingly. ?A self-assessment regime, a system of tax administration, encourages a taxpayer to voluntarily assess himself and file his tax returns. The tax returns form the basis for a tax officer to carry out his responsibility. Emphasis was made on the importance of the examination of tax returns as a compliance check measure, what examination of tax returns entails, what tax returns mean, the contents of tax returns and financial statements, and the qualities of a good tax officer.

In addition, the usefulness of ratio analysis in assessing and interpreting financial statements, especially at the preliminary stage of examination of tax returns, was explored. Tax audit and tax investigation were discussed, while tax evasion and tax avoidance schemes were explored. Finally, a practical question was treated to explain what is expected of a tax officer when given a task to examine a company that enjoys pioneer status incentives on one of its products but also earns other income taxable during a period under review. The steps for examining capital allowances of a company and the?treatment of capital allowances where a company’s assets are deployed in generating both non-taxable and taxable income were explored. The provisions of the Companies Income Tax Act, 2004 (as amended) and the specific treatment given where a company enjoys the pioneer status incentives were discussed. The discussion was also extended to how the revised income tax of a company can be computed considering the normal basis, minimum tax basis, and excess dividend tax basis. Lastly, the conditions for exemption of a company from excess dividend tax were explored.