Frequently asked questions about Nigeria VAT
What is VAT?
VAT is the abbreviation of Value Added Tax and is in general due when goods and/or services are sold. It is generally chargeable on all taxable goods and services supplied in (i.e., consumed or otherwise utilised) Nigeria. It is a consumption tax because it is ultimately borne by the final consumer.
Who must pay VAT?
Generally, VAT is invoiced by the supplier that is selling goods or services and collected from the customer. Subsequently, the supplier reports and remits the collected VAT to the tax authorities.
Why am I being charged VAT?
Video conferencing services and telecommunication (in the form of electronic communication services) supplied by Zoom fall within the rules concerning electronically supplied services by non-resident service providers to businesses (B2B) and consumers (B2C) in Nigeria.
Zoom has been appointed a non-resident VAT collector for B2B and B2C supplies of electronically supplied services in Nigeria. As such, Zoom is required to charge VAT on all taxable supplies made to customers in Nigeria.
What is a Taxpayer Identification Number?
A Taxpayer Identification Number (TIN) is a unique 12-digit number (in the format 12345678-1234) issued by the Federal Inland Revenue Service (FIRS) in Nigeria that identifies taxpayers in Nigeria.
Where you have provided your TIN to Zoom, this will show on invoices issued to you by Zoom.
How do I enter my TIN?
To enter your TIN, please follow these steps:
- Sign in to the Zoom web portal.
- In the navigation menu, click Account Management then Billing.
- Click the Billing Information tab.
- Under Sold To Contact, click Edit to edit the TIN (which appears after the Sold To Contact address fields).
- Enter your TIN.
- Click Save Changes.
Does Zoom have a TIN?
Yes. Zoom is registered for VAT in Nigeria and is appointed a non-resident VAT collector for the purposes of B2C and B2B supplies of electronically supplied services. Zoom’s TIN will be shown on the invoice it issues to you.
How is Zoom determining which customers Nigerian VAT applies to?
Zoom will apply VAT if the location of the “Sold To” contact address entered by the customer is in Nigeria. This information is subject to cross-referencing against other data to verify that the ‘Sold to’ country is accurate. It is your responsibility as a customer to ensure that your ‘Sold to’ address is accurate.
Is there a minimum threshold purchase amount before VAT is applied?
No, all supplies of electronically supplied services to customers in Nigeria are subject to Nigerian VAT.
Does Zoom provide VAT exempt or non-VATable services?
No, all services currently provided by Zoom to customers in Nigeria are subject to Nigerian VAT.
Are there any special exemptions applicable for charities under which VAT may not be charged?
No, there are no exemptions from VAT available under Nigerian VAT rules for the services Zoom supplies to charities in Nigeria.
Will VAT apply even if a Nigerian company provides a valid TIN to Zoom?
Yes, VAT applies to all the supplies that Zoom makes to customers in Nigeria.
Are there any VAT obligations for me as a customer?
No, the customer in principle has no VAT obligations. If you are registered for VAT in Nigeria and you want to claim the VAT charged to you by Zoom, as a minimum, you should ensure to keep a copy of Zoom’s invoice for your records.
Every customer is unique and so are their specific tax circumstances. The above-stated information should not be considered as tax advice, but as a general overview of relevant tax rules in Nigeria. Zoom cannot provide you with tax advice for your individual situation, and therefore we strongly recommend speaking with a professional tax advisor for tailored advice.
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