TAX – Nov 2020 – L1 – SA – Q10 – Withholding Tax (WHT)

Identify the penalty rate per annum for failure to deduct or remit withholding tax.

Question

A person who is obliged to deduct withholding tax but fails to deduct, or having deducted, fails to remit on the due date, shall be guilty of an offence and liable to a penalty of _________ per annum of the tax withheld or not remitted, as the case may be:
A. 25%
B. 21%
C. 15%
D. 10%
E. 5%

Answer

D. 10%

Explanation:
According to Nigerian tax laws, any person who is required to deduct withholding tax but fails to deduct or remit on the due date is liable to a penalty of 10% per annum of the amount of tax not deducted or remitted. This is to ensure compliance and timely remittance of withheld taxes.

Tags: Nigerian Tax System, Non-compliance, WHT Penalty, Withholding Tax
Level: Level 1

Topic: Withholding Tax (WHT)
Series: NOV 2020

Uploader: Dotse