What is a TIN?
The Taxpayer Identification Number (TIN) is a unique number that identifies a specific individual (or business) for the purposes of paying taxes. As tax payment is mandatory for all individuals and businesses, everyone needs to have a unique TIN. However, this article will deal with TIN for businesses.
Who needs a TIN?
As mentioned above since tax payment is compulsory, every business must have its own unique TIN.
In July 2020, the CAC announced that upon successful registration of companies under Part A i.e. limited liability companies, a TIN would be automatically assigned to the company. However, the notification by the CAC does not cover other business organisations e.g. business names, therefore organisations like business names will still have to register with the FIRS directly.
What do you need it for?
Apart from registration for TIN being mandatory, there is a long list of other things, which you need a TIN for:
- Opening a corporate bank account – Section 28(1) of the Personal Income Tax Act which was amended by the Finance Act 2020, states that ‘a person engaged in banking shall require that a person intending to open a bank account for the purposes of the person’s business operations shall provide a tax identification number as a precondition for opening or continue operating of such bank account’.
- Government loans,
- Foreign exchange,
- Application for trade licenses, Import and export licenses
- Registration of motor vehicles,
- Application for certificate of occupancy, etc.
A TIN is also necessary to get a tax clearance certificate for your business. You will need this as evidence that you are paying your taxes as due.
How do you apply?
To obtain a TIN for a business already incorporated at the Corporate Affairs Commission, you will need to go to the Federal Inland Revenue Service (FIRS) office that is closest to your registered address. You can find the locations on the FIRS website with the following documents:
- Memorandum & Articles of Association
- Certificate of Incorporation: CAC2, CAC7
- Company seal
- Utility bill
- Application letter on company letter headed paper
- Duly completed TIN Application form
You should take the original copy and 2 photocopies of each document. The originals are required for sighting only, 1 copy will be left with the FIRS, and 1 copy will be stamped and signed by an FIRS official as evidence that you have made an application.
If your business is a registered business name, and not an incorporated company. In order to apply for TIN you need to apply for VAT registration, the VAT number you are provided with will be your TIN registration number. Please jump to our article on how to register for VAT here, to find out more.
How much does it cost?
Applying for your TIN IS FREE if you do it yourself.
You do not have to pay any fees to obtain it, and you do not need to employ someone to apply on your behalf. However, most people decide to engage the services of 3rd parties to assist them in obtaining it.
How long does it take to get my TIN?
Ordinarily, the TIN should be given instantly or at most by the next day, however, it appears that a number of the FIRS offices are struggling with backlogs, and so it is not uncommon for the process to drag on for about a week or in some instances 2 weeks.
Remember payment of tax is a civic duty. If you are doing business in Nigeria or intending to do business, you are expected to fulfill this necessary obligation and the first step in this is obtaining your TIN.
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We hope you have found this information helpful. Please note that this information is provided for general informational purposes only and is not intended to be legal advice. No lawyer-client relationship is formed nor should any such relationship be implied. It is not intended to substitute for the advice of a qualified lawyer. If you require legal advice, please consult with a qualified lawyer.