Salute great nairalanders!

I work with a multinational organization. We are paid 13thmonth salary (bonus) at year end. However, tax is deducted and we end up getting net instead of gross. I tried to search online to see what the Nigerian tax law states as to taxation of 13month salary but couldn't find any.

To that, I brought it here for the experienced and learned heads to throw light on the subject. Please is it taxable? And where can I get where the Nigerian tax law talks about this so I can follow it up in my organization

No it is not,
That is also why you shouldn't tithe on it.

It's taxable. All incomes are taxable home and abroad except those with specific exemptions like income from govt bonds etc

tempex88:
It's taxable. All incomes are taxable home and abroad except those with specific exemptions like income from govt bonds etc

Can I have reference? I could be wrong but I thought bonuses are exempted from tax

tempex88:
It's taxable. All incomes are taxable home and abroad except those with specific exemptions like income from govt bonds etc

I thought each country has its tax laws

praxs:


I thought each country has its tax laws

Yes. In Nigeria, all your earnings home and abroad are taxable if you are a Nigerian.

praxs:


Can I have reference? I could be wrong but I thought bonuses are exempted from tax

Google personal income tax act

Its a gift its suppose to be exempted from tax

tempex88:
It's taxable. All incomes are taxable home and abroad except those with specific exemptions like income from govt bonds etc

They ain't supposed to tax it.

Suko110:
Its a gift its suppose to be exempted from tax

How is 13th month salary a gift?

uboma:




How is 13th month salary a gift?

Sorry man, its a bonus and its fully subjected to tax.
Thanks for the criticism....

Suko110:


Sorry man, its a bonus and its fully subjected to tax.
Thanks for the criticism....

one fact most people fail to understand is that 13th month salary is not a bonus but rather be a normal salary being worked for as an employee.

Go to your calendar, you would see that month February is the only month with normal days outline.

A simple arithmetic shows that a month should have 4 weeks multiplied by 7 days to give you 28 days as normal.

Every other month has additional 2 to 3 days making it has 30 or 31 days within.

Now sum up these extra 2 to 3 days on the rest eleven months in a year, you definitely get 29 days as your answer, resulting to another month.

Hence you agree with me that 13th month salary is never a bonus to you but an accumulated extra 29 days in a calendar year which ought to be taxed like your regular salary.

Suko110:

Sorry man, its a bonus and its fully subjected to tax. Thanks for the criticism....

Another error.

13th month salary is not a bonus.

FatokiFemi48:



one fact most people fail to understand is that 13th month salary is not a bonus but rather be a normal salary being worked for as an employee.

Go to your calendar, you would see that month February is the only month with normal days outline.

A simple arithmetic shows that a month should have 4 weeks multiplied by 7 days to give you 28 days as normal.

Every other month has additional 2 to 3 days making it has 30 or 31 days within.

Now sum up these extra 2 to 3 days on the rest eleven months in a year, you definitely get 29 days as your answer, resulting to another month.

Hence you agree with me that 13th month salary is never a bonus to you but an accumulated extra 29 days in a calendar year which ought to be taxed like your regular salary.

Nice point, but let me ask you
Do you get payed weekly?
If no, your employer could choose to not pay you the so called 13th month and nothing will happen. Its simply a bonus or do we have a 13month calendar year. When it comes to remuneration, its what it is, not logic. Peace

Suko110:

Nice point, but let me ask you
Do you get payed weekly?
If no, your employer could choose to not pay you the so called 13th month and nothing will happen. Its simply a bonus or do we have a 13month calendar year. When it comes to remuneration, its what it is, not logic. Peace

I'm being paid on monthly basis which is regular.
Mind you if your employer denies your 13th month salary, then it's obvious he's denying you your right as against Nigeria labour law. It may not necessarily reflect in your appointment letter but labour law backs it up.
You may Google out Nigeria labour law to view for yourself if you still in doubt.

Yes

Bbbh

No, not at all!!

praxs:
Salute great nairalanders!

I work with a multinational organization. We are paid 13thmonth salary (bonus) at year end. However, tax is deducted and we end up getting net instead of gross. I tried to search online to see what the Nigerian tax law states as to taxation of 13month salary but couldn't find any.

To that, I brought it here for the experienced and learned heads to throw light on the subject. Please is it taxable? And where can I get where the Nigerian tax law talks about this so I can follow it up in my organization

It is not just taxable, it is taxable at a higher effective tax rate.

Whatever emolument you get from you employer (discretionary or contractual) from which you are intended to benefit is taxable

Suko110:
Its a gift its suppose to be exempted from tax

I don't understand. How is it a gift?

praxs:
Salute great nairalanders!

I work with a multinational organization. We are paid 13thmonth salary (bonus) at year end. However, tax is deducted and we end up getting net instead of gross. I tried to search online to see what the Nigerian tax law states as to taxation of 13month salary but couldn't find any.

To that, I brought it here for the experienced and learned heads to throw light on the subject. Please is it taxable? And where can I get where the Nigerian tax law talks about this so I can follow it up in my organization

You want to take it up with your employer for being magnanimous giving you bonus that is not compulsory?

Don't be like the proverbial man one who has eaten to bellefull and still looking for how to cut his stomach up ( eni to jeun yo tan t'o n wa bekun bekun kiri).

NO ...Ìts not taxable

People misinterpret their leave allowance as the 13th month salary. When you go on leave you are paid an extra salary as your eave allowance. But in a situation where u do not go on leave throughout the year,the allowance is paid at the end of the year and we assume its the 13th month salary

Check section 3 of Personal Income Tax Law as amended in 2011 for the definition of income chargeable.
13th month is 100% taxable
Good luck.

It rightly is.

13th month salary is taxable because it's an income you earn.

If we don't have 13th month in a year, why should it be taxed or what name exactly would government call that? This is stealing from the government side. Anyway what do I know?

bigplayerz:
NO ...Ìts not taxable

prove and leave your answers to d nearest references.thanks in advance.

[quote author=FatokiFemi48 post=67735702]


one fact most people fail to understand is that 13th month salary is not a bonus but rather be a normal salary being worked for as an employee.

Go to your calendar, you would see that month February is the only month with normal days outline.

A simple arithmetic shows that a month should have 4 weeks multiplied by 7 days to give you 28 days as normal.

Every other month has additional 2 to 3 days making it has 30 or 31 days within.

Now sum up these extra 2 to 3 days on the rest eleven months in a year, you definitely get 29 days as your answer, resulting to another month.

Hence you agree with me that 13th month salary is never a bonus to you but an accumulated extra 29 days in a calendar year which ought to be taxed like your regular salary.


You are very correct my guy. This is the premise behind the 13th month pay check. I equally work with a multinational company and this is tax deductible.

FatokiFemi48:



one fact most people fail to understand is that 13th month salary is not a bonus but rather be a normal salary being worked for as an employee.

Go to your calendar, you would see that month February is the only month with normal days outline.

A simple arithmetic shows that a month should have 4 weeks multiplied by 7 days to give you 28 days as normal.

Every other month has additional 2 to 3 days making it has 30 or 31 days within.

Now sum up these extra 2 to 3 days on the rest eleven months in a year, you definitely get 29 days as your answer, resulting to another month.

Hence you agree with me that 13th month salary is never a bonus to you but an accumulated extra 29 days in a calendar year which ought to be taxed like your regular salary.

I agree with your point, however, 13 month salary is not subjected to be taxed as the extra 2-3 days in each months of the year has already been taxed. I work with a private organization and my 13 month salary has never been taxed.