There are safe and risk free ways to make extra cash from that money sitting in your bank account. Fixed deposits (FD) and Nigerian treasury bills (NTBs) are two good options to consider.
While the banks are trying to reduce the interests customers are supposed to earn using savings account with every possible medium by deducting for almost any account activity like email alerts, sms alerts, atm withdrawal, account maintenance and many more. You can opt into FD or NTBs and get a higher return over three times the interest that a regular savings account would give you if only you can keep the money intact in your account for a minimum of 90 days(3months) for NTBs or 30 days(1month) for FD.
Find details of Fixed Deposits and Nigerian Treasury Bills below if you decide to go for either of them.
FIXED DEPOSITS
Fixed deposits are shot term investments, usually for a 30, 60, 90, 180, or 365 day period.
Facts & Features of Fixed Deposits:
Interest on fixed deposits are subject to 10% withholding tax which is credited to the government.
In most Banks, if you are terminating the investment before maturity, on your accrued interest, a 20% penal charge is applied.
The bigger the amount and the longer the investment period should most likely earn one a more juicy rate, but irrespective of that, in most banks, 99% of the time, the banker you are interfacing with will never offer you the highest interest rate. Thus, your negotiating skill & ability matters, as well as your willingness to move your money to the next bank.
Unlike NTBs interest which is paid upfront, interest on fixed deposit are paid only at maturity.
In most banks, you can start fixed deposit investment with N100,000. In some other banks, it is lower.
While filling the fixes deposit request form, at maturity, you can chose to rollover principal only, rollover principal + interest or have both principal + interest credited back to your account.
Fixed deposit investment are risk free investment.

NIGERIAN TREASURY BILLS (NTBs)
Nigerian Treasury Bills are also short term investment but in government instruments. They are usually placed for either a 91 day period, 182 days or 364 days.
Facts & Features of NTBs, by Creditful:
Interest rates on NTBs are always higher than what any Bank would offer you on Fixed Deposit. Especially your NTBs investment is for a 364 day period.
Your negotiating skill is not needed as the determined rate on the auction date between the concerned parties (the CBN, Commercial Banks, investment houses, etc) applies to everyone’s investment irrespective of the bank or investment house through which the investment was placed. Thus, if on the auction date the bills for 91 days are offered at 12% per annum, across all banks & investment houses, 12 will apply.
Interest is paid up-front. For instance if you are investing #100,000 @ 12 per annum for 91 days, the interest figure, in this case which is about #2,991.78 will be credited to you immediately while only your principal will be returned at maturity.
NTBs interest is subject to N100 as handling charge & 0.25% commission both in favour of the processing bank or investment house.
While placing the investment, one can choose to rollover both principal + interest, principal only or have the principal returned to his/ her account at maturity.
One who wishes to terminate at maturity can also do so through the bank or the investment house where the investment was placed. The process is not hitch free and can be time consuming.
NTBs investments are absolutely risk free investments, and are the best forms of investment recommended for those who are risk conscious.

COMPANIES INCOME TAX
Under the Companies Income Tax Act (“CITA”), Cap C21, LFN 2004, (as amended by the Companies Income Tax Amendment Act No. 11 of 2007), a tax at the rate of thirty percent (30%) is imposed on the income of a company incorporated in Nigeria, after the deduction of all allowable expenses, losses and capital allowances.
Every company assessable to tax under the CITA must prepare and file on a self- assessment basis, with the FIRS, audited accounts and income tax computations within 6 months after the end of the accounting period. However, in the case of new companies, the returns are to be filed within 18 months, from the date of incorporation, or 6 months after its first accounting period, whichever occurs first.
EDUCATION TAX
Pursuant to the Education Tax Act Cap E4 LFN 2004, every company incorporated in
Nigeria is obliged to pay 2% of its assessable profit as Education Tax.
INDUSTRIAL TRAINING FUND (ITF)
The Industrial Training Fund Act CAP I9, LFN 2004 (the “IDTF Act”) (as amended by the Industrial Training Fund Amendment Act, 2011) establishes the Industrial Training Fund (the “Fund”). The purpose of the Fund is to promote the acquisition of relevant skills in industry or commerce with a view to generating a pool of indigenous manpower to satisfy the needs of the economy. Every employer that is liable under the ITF Act must contribute one (1) percent of the amount of its annual payroll to the Fund. Employers that are liable to make contributions under the Fund are:
Employers having five (5) or more employees in their establishment;
Employers who have less than five (5) employees but having a turnover of fifty N50 million and above per annum;
Suppliers, Contractors or Consultants who bid for contracts from any federal government agency or parastatals or private companies; and
Companies operating in the free trade zone which seeks for approval for Expatriate Quota or makes use of any custom services.
In the determination of the contributions to be made to the Fund, all employees including those who work part time and temporary employees are included in the assessment. Further, all the allowances and entitlements paid to such employees within or outside Nigeria are calculated when considering the total payroll of an employer.
The IDTF Act further imposes a duty on employers to provide training for their indigenous staff with a view to improving their job related skills. Furthermore, the IDTF Act provides that the Fund’s Council may make a refund of up to 50% of the amount paid by an employer where it is satisfied that its training program is adequate.
Failure to make contributions within the stipulated period in a calendar year attracts a penalty of five per cent (5%) of the amount unpaid for each month or part of a month after the date on which payments should have been made.
INFORMATION TECHNOLOGY TAX
Pursuant to the National Information Technology Development Agency Act No. 31 of 2007 a tax of 1% of profits before tax is chargeable on the income of the underlisted companies with a turnover of N100 million and above:
GSM service providers and all telecommunications companies;
Cyber companies and internet providers;
Pension managers and pension related companies;
Banks and other financial institutions, and
Insurance companies.
PERSONAL INCOME TAX
The income of employees is subject to tax levied at progressive rates as detailed in the table below. The Personal Income Tax Act (“PITA”) Cap P8, LFN 2004 establishes a Pay-As-You-Earn (PAYE) system whereby employers are required to act as agents of the tax authorities for the purpose of collecting and remitting taxes on salaries due to their employees. PAYE taxes are required to be remitted within fourteen (14) days after the month of deduction. At the end of every year, the employer is required to submit all the tax deduction cards and employer’s remittance card (Form G).
First N300,000
7%
Next N300,000
11%
Next N500,000
15%
Next N500,000
19%
Next N1,600,000
21%
Above N3,200,000
24%
The summary of the tax deducted from each employee would be shown on the employer’s annual Declaration Form (Form H1) and submitted to the tax authority. This should be done on or before January 30 of the following year.
WITHHOLDING TAX
The Nigerian tax laws (CITA and PITA) provide that where any payment on which withholding tax should be deducted is due from one person to another, the person making the payment is expected to deduct tax at the applicable rate and remit the tax deducted to the relevant tax authority within a reasonable period, not later than 30 days after deduction. Some of the activities and services on which withholding taxes are deductible and the current applicable rates are as follows:
Transactions
Companies
Individuals
Dividend, interest & rent
10%
10%
Royalties
10%
5%
Hire of equipment, motor vehicles, plants, and machinery
10%
10%
Commission, consultancy, technical and management fees, legal fees, audit fees, and other professional fees
10%
5%
Construction
5%
5%
All types of contracts and agency arrangements, other than sales in the ordinary course of business
5%
5%
Directors’ fees
N/A
10%
The rate of withholding tax on dividend, interest and royalty is reduced to 7.5% when paid to a recipient resident in a country with which Nigeria has a double taxation treaty.
CAPITAL GAINS TAX
Capital gains tax is levied on capital gains accruing to a taxable person upon disposal of assets, irrespective of whether the asset is situated in Nigeria or not. The tax is applicable to all companies, including pioneer companies and all individuals and non- corporate bodies. The rate of tax is currently 10%.
The information contained here is based on relevant Nigerian laws, regulations and practices applicable to doing business in Nigeria, as of November 14 2018. This Manual only highlights legal issues, in general, and is not exhaustive. Also it does not, and it is not intended to, constitute legal advice and or opinion. If you have questions or require advice in respect of matters contained herein or any other specific issues, kindly contact us for such advice and we would be happy to assist you on an individual basis and walk with you on your journey to explore the limitless opportunities for investments in Nigeria.
AceConsulting does not accept liability for any action (or lack thereof) by you or anyone else as a result of reliance on, or any other use of, information contained herein. For the avoidance of doubt, under no circumstance shall AceConsulting be liable for any consequences resulting from reliance on or use of information contained in this Manual.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

For some business owners, it is a nightmare scenario: You were counting on getting that small business loan, but the bank said no. What do you do next?
That depends on exactly why your loan application was rejected! Step one: find out the reason for the denial. Some bankers will be more specific while others won’t share details, but by law, banks must mail you a notice explaining the reason/reasons why your loan application was denied, according to fundbox.com.
If this has happened to you recently, you might be quite discouraged right about now. Don’t feel down! It happens to many successful owners, sometimes more than once. Understanding the reasons why is the first step to a successful future financing application.
Here are some of the most common reasons for a business loan rejection.
Your credit score
One of the most common reasons for loan rejection is if the lender deems your credit score to be “too low.” The magic score number will differ depending on the lender and situation. Your personal credit score does factor into a small business loan, even if your company has been in business for a while. If you can’t manage your personal credit, the logic goes, how reliable will you be when it comes to paying back a business loan?
If a low credit score is the reason you are turned down, review your score and take steps to repair it. It is a good idea to brush up on what goes in to your personal and business credit score, too, so you understand how you are being evaluated. If you have a successful business, but had to damage your personal credit to build it, you are not alone. Take heart: there are more options out there for you than ever before.
Not enough time in business
If your business is relatively new, you may not have built up enough of a business credit history to qualify for a small business loan. Note that vendors don’t always report your payments to the business credit agencies automatically. Whenever you set up an account with a new supplier or other vendor, make sure they report your payments so your business can build up a good credit history.
Of course, it is possible to have a very successful business and solid financials, even if you have not been operating very long—you just need to find the right lender for your situation. Some lenders require much more time in business than others, so take a look at your options when deciding where to apply for business credit.
Your industry is risky
Some industries are simply considered risky by traditional lenders. Restaurants are a good example because they have a high failure rate. If your business operates in certain vice industries, such as gambling, you may also face extra hurdles to getting a loan. If this is why you were rejected, investigate lenders who specialise in your industry—they are out there.
You don’t have enough collateral
Many traditional lenders require you put down collateral in order to obtain a business loan. If you don’t have enough collateral or lack the right type of collateral, you may get turned down. If this is your situation, look for alternative sources of financing such as unsecured loans.
Your debt utilisation is too high (or not high enough)
Typically, lenders want you to be using no more than 30 per cent of the total credit available to you. If you use too much, many lenders consider you to be overextended, and worry that you won’t be able to pay them back. For example, if you have a N100,000 line of credit, but have already used N90,000 of that line, you are considered a higher risk.
On the other hand, if you don’t have any debt, or lack a history of using credit responsibly, that can count against you, too. Make sure to keep track of your total credit limits, including business credit cards, personal credit cards, lines of credit, and other credit sources, and maintain a reasonable debt usage.
Not enough evidence of strong cash flow
Cash flow is one of the first things lenders look at when deciding whether to approve a small business loan. They want to know that you have enough cash flow to not only cover your business expenses, but also pay back the loan and still have a cushion. If your cash flow is spotty, or you regularly experience seasonal slumps, that can be a red flag.
Poor cash flow is a major cause of business failure, so if this is why your loan application was rejected, you might need to examine your cash management skills. Use accounting software that enables you to easily generate cash flow reports and projections; then, monitor your cash flow weekly to stay on top of it. Be diligent about collecting payments due from customers—don’t let invoices drag out to 60, 90, or 120 days past due.
You are not asking for enough money
It sounds counter-intuitive, but often, the more money you ask for, the more likely you are to obtain a bank loan. For banks, the cost of servicing small loans (under N100,000) is just not worth it, which is why you generally can’t get business loans for small amounts of money from a major bank.
Review your financial projections and business plan to make sure you are not underestimating the amount of capital you need. Perhaps you can apply again and ask for a larger sum. If you don’t need more than you already asked for, look for an alternative financing source, such as a micro-lender or invoice-based financing option that can make smaller loans. Consider options beyond loans, too, if you need funding but don’t need a large lump sum, like a small business line of credit.
Incomplete application/paperwork
Sadly, one of the most common reasons small business loan applications are denied is that the applicant did not complete the application correctly or did not provide all the necessary backup information. It is hard to blame you if this is the reason you were denied: business owners often spend 20, 30, or even more hours on a loan application!
Among the supporting documents most banks will ask for are a business plan, three to five years of business and personal tax returns, business bank account statements, financial statement/projections for the business, and your personal and business credit reports. They may also want to see legal documents related to your business such as contracts, leases, licenses, permits, and corporate documents. The fix for this problem is easy: Get your paperwork in order before applying again.
Getting rejected for a business loan when you need financing is one of the worst feelings ever. Remember, though, it is not personal, and you can try again. After you get past the initial frustration, though, it can be a learning experience, and prepare you for success next time.

What is PAYE?
You know those little deductions you see in your payslip, when you receive your salary, if you look closely, you will find that one of such deductions is the PAYE. For some of you, you have probably wondered, “What is PAYE?” Pay As You Earn (PAYE) is a form of tax deducted by an employer from the employee’s salaries and wages. This tax deduction is also known as Personal Income Tax, and is made based on the provisions of Section 81 of the Personal Income Tax Act (PITA) . PITA applies to every income that is received by an individual.
Remitting PAYE
Employers must begin deducting tax from the salaries and wages of their employees after 6 months of the company commencing business operations. The deducted taxes are remitted to the Lagos State Internal Revenue Service (LIRS), which is the tax regulatory body for Lagos State through any designated collecting bank. After payment, has been made to the collecting bank, the employer will take evidence of payment to its tax office. Your tax office should be the nearest tax office to your primary operating premises. Here’s a list of the location of the various LIRS tax offices in Lagos.
As an employer, you must ensure that PAYE is remitted to the LIRS before the 10th of the month following the month when the deductions were made. E.G January PAYE must be remitted on or before February 10th. Note that contract employees and interns are not exempted from PAYE deduction.
At the end of the year, employers are expected to file duly updated returns on all salaries and wages paid to the employees on their payroll within the preceding tax year. Returns must be filed at the employer’s tax office before January 31st for the preceding year. For instance, 2016 returns must be filed before January 31, 2017.
PAYE rates
If you have read this far, the question on your mind is probably, “how much exactly is this PAYE?” Well, it depends. Lagos operates a graduating scale PAYE system. The tax rates increases based on the employee’s annual taxable income The scale used by the LIRS is:
a. The first N300,000 will be charged at 7%;
b. The next N300,000 will be charged at 11%;
c. The next N500,000 will be charged at 15%;
d. The next N500,000 will be charged at 19%;
e. The next N1,600,000 will be charged at 21%;
and
f. Then above N3,200,000 will be charged at 24%.
Where an employee’s annual taxable income is below the N300,000 threshold, then the appropriate tax rate will be 1%.
So, for instance, where an employee makes N5 million a year, not all of the N5 million would be taxed at the maximum of 24%, but rather the first N300,000 of the N5 million would be taxed at 7%, the next N300,000 of the remaining N4.7 million will be taxed at 11%, the next N500,000 of the remaining N4.4 million will be taxed at 15% and so on until the maximum threshold is reached.
Failure to File Taxes
Not filing taxes is a criminal offence! Any employer who fails to make proper tax deduction or fails to account properly for deductions made is liable on conviction to a penalty of the total sum of taxes due. In addition, the employer will pay 10% annual interest for every year the taxes were not filed or improperly filed. Employers are also liable to penalty and interest for failure to remit and late remittance.

There are two new directives, first for the fast reaction mechanism aimed towards preventing VAT fraud. Second one is for the optional and temporary application of the reverse charge mechanism in relation to supplies of certain goods and services. Quick Reaction mechanism provides the legal basis to the countries that are members of the EU to integrate an emergency measure in they are in position to serious case of sudden and massive VAT fraud.

Financial statements may be used by different stakeholders for a multitude of purposes. Owners and managers require financial statements to make important business decisions affecting its continued operations. Financial analysis is then performed on these statements, providing management with a more detailed understanding of the figures.

Financial statements are prepared according to agreed upon guidelines. In order to understand these guidelines, it helps to understand the objectives of financial reporting. The objectives of financial reporting, as discussed in the Financial Accounting standards Board (FASB) Statement of Financial Accounting Concepts No. 1, are to provide information that

Financial statements are prepared according to agreed upon guidelines. In order to understand these guidelines, it helps to understand the objectives of financial reporting. The objectives of financial reporting, as discussed in the Financial Accounting standards Board (FASB) Statement of Financial Accounting Concepts No. 1, are to provide information that