The Lagos State Government, through the LIRS, has issued a Public Notice (The “Public Notice”) on the appointment of payers of capital sums inclusive of employers as collecting agents for the purpose of deducting and remitting Capital Gains Tax (CGT) due on the respective Capital Sums paid, including but not limited to compensation for loss of employment.
The Public Notice is a follow up to the Public Notice issued by the LIRS in September 2017 on Exemption of compensation for loss of office (“the Previous Notice”). This Public Notice refers to the Previous Notice which states clearly that employers must segregate compensation for loss of employment into specific pay components, with a view of ensuring correct tax treatment in relation to:
(a) tax exemption;
(b) income subject to ‘pay as you earn’ (PAYE); and
(c) payments subject to CGT.
