WHAT IS FIRS PRE-OPERATIONAL LEVY

Pre-Operational Levy is a levy imposed on companies which fail to commence business within six months after their incorporation. The levy is N 25,000 in the first instance and N 20,000 for any other year, if it still has not commenced business. It is to be levied when the taxpayer applies for current Tax Clearance Certificate (TCC). Pre-operational levy should not be imposed

for any previous years when the Company did not apply for TCC; neither should it be raised in arrears to cover earlier years.

Apart from having a role in revenue generation for the FIRS, the basis of the pre-operational levy appears to be questionable, as company income tax is generally payable on profits. It may be sufficient to require such companies to at best file a nil return rather than subjecting them to taxation under any form before the commencement of business.


Ajibola Aderonke is an auditor at professional services firm Ernst & Young (EY). She previously worked another Big 4 accounting firm PwC. She can be reached at ajibolaaderonke@gmail.com for ideas and suggestions. The post above and its ensuing comments, if any, is purely the opinion of the writer.