Penalties and Interest to Accrue from the Date of Failure to Remit Taxes

The Tax Appeal Tribunal (TAT) on 14 May 2019, delivered a judgement in the case of Shell Nigeria Exploration and Production Company Limited v. Lagos State Internal Revenue Service (LIRS) with suit numbers TAT/LZ/PIT/085/2014 & TAT/LZ/PIT/085/2014, holding that penalties and interest will accrue from the date of the failure by the taxpayer to remit outstanding taxes and will become payable when the tax assessments become final and conclusive.

The matter was an appeal against the demand notice issued by the LIRS (the Respondent) on Shell (the Appellant). By the demand notice, the Respondent imposed an additional assessment for Pay-as-you-Earn (PAYE) and state development levy including penalties and interest for the 2012 year of assessment. In addition, the Respondent had earlier issued the Appellant an additional assessment for PAYE, withholding tax (WHT), state development levy as well as interest and penalties on the said taxes, for 2007-2012 years of assessment.

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