The Federal Inland Revenue Service (FIRS) audited the tax returns of Ecobank Nigeria Plc ("Ecobank", "the company" or the "Bank") relating to the 2015 and 2016 financial years (FYs). The FIRS alleged that the Bank paid out about N5.5bn in dividends to its shareholders out of its 2015 FY accounts when the company was in a tax loss position for the year.
The Tribunal made a determination on the following issues:
- Was the FIRS correct to assess EDT on dividends paid out of profits from Bonds, Treasury Bills and other Government Securities which are specifically exempted from Companies Income Tax?
- Was the FIRS misdirected as it did not consider the EDT on dividends from taxable profits already paid by the Bank?
- Whether the FIRS interpreted and applied the EDT provision correctly in line with legal principles.
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