Introduction
Driven by the need to enhance tax compliance and mobilize tax revenues to meet the National budget, the Finance Act 2023 introduced a tax amnesty (“the amnesty”) on penalties and interest effective 01 September 2023.

What is the tax amnesty?
The tax amnesty provides taxpayers the opportunity to regularize their tax compliance affairs.
The amnesty will be applicable to outstanding penalties and interest that have accrued for periods prior to 31 December 2022 for which the principal tax has already been paid or where the principal tax is yet to be paid but the taxpayer is willing to settle the same by 30 June 2024.
Further, the amnesty shall apply to penalties and interest arising from amendment of returns, iTax ledger reconciliation or system issues and tax disputes provided the same fall within the qualifying period (prior to 31 December 2022). The amnesty shall not be applicable to penalties and interest arising from a tax avoidance assessment or those accruing from 01 January 2023.
The tax amnesty shall cover Corporate Income Tax (“CIT”), Withholding tax (“WHT”), tax on capital gains (“CGT”), Pay As You Earn (“PAYE”), Value Added Tax (“VAT”), and Excise Duty

What are the benefits of the tax amnesty?
Upon successful application/granting of the tax amnesty, a taxpayer will be entitled to:
• Full relief from penalties and interest accrued up to 31 December 2022
• A flexible payment plan (up to 30 June 2024) for the principal taxes due
• A clean tax ledger

Why do you need to act fast?
The amnesty is for a limited time and considering the scope of taxes covered by the amnesty namely PAYE, corporate tax, withholding tax, excise duty, VAT, and tax on capital gains, it is important that you review all your tax obligations now so as to reap the benefits of a clean iTax ledger, free of penalties and interest.

What steps are required for taxpayers to benefit from the tax amnesty?
For taxpayers with outstanding penalties and interest in relation to principal taxes paid prior to 31 December 2022, the amnesty shall be automatic and there shall be no requirement to submit an application to the Commissioner. The revenue authority is in the process of configuring the iTax system to allow for the automatic clearing off, of penalties and interest where there is no principal tax due.
For taxpayers with outstanding penalties and interest in relation to principal taxes that are outstanding as at 31 December 2022, an application for amnesty shall be required to be submitted to the Commissioner. The application shall be accompanied with the proposed payment plan for the outstanding principal tax in the event the taxpayer wishes to settle the principal tax in installments.
Taxpayers seeking to apply for the tax amnesty can do so through a manual application form that has been rolled out by the revenue authority pending the configuration of the iTax system to allow for the applications to be submitted on iTax.

How can MBCJ Certified Public Accountants help?
We can assist you reconcile your iTax ledger to determine whether or not you qualify for the tax amnesty. We can also assist you reconcile expenditure like staff costs to PAYE declared in your tax returns or assist reconcile sales turnover with your VAT returns. In this regard, it is worthwhile to conduct a thorough tax health check including a review of the iTax ledger.
We are happy to walk with you to ensure a holistic review of your tax compliance status so that where applicable, you can take advantage of the tax amnesty. To discuss this further, please reach out to our contacts herein or your usual MBCJ contacts.