The Nigerian Investment Promotion Commission, NIPC, granted 8 fresh companies tax relief under the Pioneer Status Incentives, PSI, application in the third quarter of 2021.
This is according to a recent report by the Commission on the PSI Application process between July and September 2021, and seen by Nairametrics.
The companies are; Belanova Apartment and Suites Limited, Al-Wabel Rice Mill Limited, JMG Nigeria Limited, Jigawa Rice Limited, DCP Cement Plc, Locodove Ventures Limited, Resource Improvement and Manufacturing Company Limited, Okpella Cement Plc.
Highlight of the report
The report reveals that 8 companies had their production date certificates confirmed as of 30th September 2021 and 35 companies were still enjoying the PSI while 168 applications are still pending with no application abandoned.
Similarly, the third quarter report shows that 28 new applications and 6 extension applications were received during the period with 16 approvals-in-principle granted, 3 extension applications approved and 2 applications denied.
What you should know
The principle of pioneer status as a tax incentive means that companies in industries designated as pioneers are relieved from paying company income tax in their early years to enable them focus on making a profit for re-investment into the business.
In other words, It could be regarded as tax holiday granted for five years, with initial period of three years and renewable for additional two years, to qualifying industries that meet the criteria, from paying corporate income tax.
While the pioneer status is administered by the Nigerian Investment Promotion Commission (NIPC), companies that qualified for pioneer status also enjoy the benefits of exemption from 10% withholding tax on dividends paid out of business profits.