PROPOSAL SUBMITTED

TO

PLATEAU STATE INTERNAL REVENUE SERVICE

ON

RECOVERY OF WITHOLDING TAX ON INTEREST EXPENSE ON BANK

DEPOSITS ( 2016 – 2023)

Ref. DPD6331
15th January, 2024

The Executive Chairman,

Plateau State Internal Revenue Service,
No 6 Bank Road,
Jos,
Plateau State

Dear Sir,
Proposal for Recovery on Withholding Tax Paid On Interest Expense Paid By Money Deposit Banks To
Customers (2016 – 2021)
Seyi Adebanjo & Co. submit the enclosed proposal for the recovery of 10% Withholding Tax (WHT) on On
Interest Expense paid by Money Deposit Banks to Customers which are accruable to the Plateau State
Government.

Our understanding of your vision is to harness government revenue seemingly lost due to non-compliance by
most banks in the deduction and/or remittances of Withholding on Interest Expense paid by Money
Deposit Banks to Customers.

We are confident that you will find our firm the right choice for the following reasons:

An understanding of the issues associated with non-compliance, with professionals who will collaborate to
assist the state in addressing these issues; and
A commitment to be proactive and ensure face-to-face communication.

We are committed to delivering high-quality and hands-on service which will bring real value to the State by
sharing our insights and connecting you with the best resources across our firm and our objective is to build a
collaborative, long-term business relationship with the state.
While looking forward to being considered for the assignment, please accept the assurances of our Firm’s
highest regards.
Yours truly,
Authorized Signatory:……………………...

Name of Signatory: Seyi Adebanjo, ACA

Contents
Page

Introduction
2
Who We Are 3
Our Approach 4
Benefits To The State 5
Our Fee
6
Our team
7

Recovery of WHT on Interest Expense

3
Withholding Tax on Interest Expense. Benefits attributable to Government;

In line with Section 70 (1) of the Personal Income
Tax Act (PITA) LFN CAP P8 2004 as amended,
‘Where a payment, such as interest or royalty ,
becomes due or payable to a person , the payer at
the date when the payment is made or credited,
which ever first occurs, shall deduct therefrom tax at
the rate prescribed in subsection (2) of this section
 Increased revenue to the coffer of the state
Government by ensuring that taxes are accurately
deducted and promptly remitted.
 Development of a robust data base /comprehensive
Master Register, capturing all bank’s depositors
resident in the state for further monitoring and
transactional reviews
 Identifying, exposing and blocking possible loopholes

and shall forthwith pay over to the relevant tax
authority the amount so deducted’
Hence, every state government in Nigeria is
empowered to collect certain levies and taxes; these
include withholding tax on Interest Expense Paid To
Customers By Money Deposit Banks
(individual/enterprises’ bank deposits).
 Improved compliance rate of banks and other
financial institutions in the deduction and prompt
remittances of WHTs on Interest Expense Paid To
Customers.
 Recovering all possible outstanding WHT taxes with
penalties and interests.
 All forms of fraud that is being perpetuated by the
companies will be largely reduced to as this exercise
will serve as a deterrent.

It has been discovered that most of these WHTs

being deducted from Interest Expense are not being
remitted and banks smartly use these funds for
trading, hence capitalising on the ignorance of the
state internal revenue service officials.

These and many other reasons have necessitated

our resolve to complement the efforts of your
government in increasing revenue generation,
basically from this source in multiple folds.

Recovery of WHT on Interest Expense

Ref. DPD6331 2
 WHO WE ARE
Seyi Adebanjo & Co. is a firm of Financial Consultants registered with the Corporate Affairs Commission

(CAC).
Our services are tailored to meet international standards; hence, we are staffed with seasoned professionals
who have garnered experiences in Revenue Monitoring and Recovery exercise(s).
We have built a reputation and known for most advantageous and effective strategies in the various revenue &
Debt monitoring and recovery assignments undertaken in the past and currently ongoing such as:
Consultant to Lagos State Government on Tax and Audit and other Private Companies.

We have equally developed a large pool of professionals and other competent staff that have absorbed the full
import of our assignments by which we have perfected our method of service delivery. The firm
places emphasis on continuing professional education for its personnel and as a commitment to our
promise of ‘Delivering Seamless Consistent High-Quality Client Service, worldwide’, our staff take regular
opportunities for both local and overseas training aimed at career development, specialized knowledge
and establishing contacts.

Against this backdrop, we believe that our exposure and the experience which we have garnered will stand us
in good stead if given the opportunity to undertake this assignment for the SIRS. We will execute the
Project to the highest professional standard and to the complete satisfaction of the State internal revenue
in particular and the State Government in general.

Recovery of WHT on Interest Expense

3
Ref. DPD6331
Our approach

Since this type of assignment includes following the lines of thought developed during the assignment, we may perform
additional procedures not initially anticipated. We will consult with you before extending our procedures.
In the light of your objectives, we have developed an overall approach as reflected below.

Clarify
Clarify Plan
Plan Execute Report
Report
Execute

►Meet with relevant ►Obtaining from banks ►Generation of comprehensive database for ►Provide a draft
staff of the State and collation of master all individual depositors resident in the report to the state
Internal Revenue list (bank by bank) of State. government
Service to clarify Interest Expense paid to ►Serve notice of monitoring and schedule of through the State
engagement depositors resident in work to be carried out Internal Revenue
expectations. the state. ►Obtain, verify and validate schedules of Service
►Establish the ►Identify the data monthly customer deposits & interest paid ►Discuss the draft
to various categories of depositors.
project/ necessary for the report and obtain
►Obtain schedules of monthly remittances
engagement plan; engagement and for comments (if any)
with dates & evidence of remittances,
and carrying out the exercise. ►Present the
verify, validate & reconcile this with above.
►Clarify other ►Collaborate with the ►Obtain
Final report .
Nationwide (state by state)
engagement State Internal Revenue Breakdown of Annual Report of ►Administer client
considerations such Service. Commission, analyzed into individuals, Biz satisfaction
as; key personnel of ►Formal introduction to Ent., Corporate bodies, etc. survey.
the State Internal banks’ and other relevant ►Establishing and analyzing shortfalls/under
Revenue Service institutions for authorized remittances arising from the sharp
with whom we are assess. practices of affected Banks.
to liaise with and ►Provide ►Ensuring full compliance with the provision
the state
work as a team, of section 70 (1) – (4) of the personal
government with a
engagement Income Tax Act.
preliminary list of
deliverables’, ►Determining the accuracy of the WHTs on
information and records
timelines, etc. Commission deducted and the timing of
required for effective
payment or remittance to the State
execution of the recovery
Government.
engagement.
►Recommend appropriate sanction on
►Obtain various WHTs defaulting/non-compliant institutions such
remittance record/details as interest, penalty & etc.
to determine present
level of compliance.

Ref. DPD6331 4
 Benefits To The State Government
Benefits Derivable by the Pleteau State Government from this Consultancy
exercise include;

 Increased revenue to the coffer of the state Government by ensuring that

taxes are accurately deducted and promptly remitted.

 Development of a robust data base /comprehensive Master Register,

capturing all bank’s depositors resident in the state for further monitoring and
transactional reviews.

 Identifying, exposing and blocking possible loopholes.

 Improved compliance rate of banks and other financial institutions in the

deduction and prompt remittances of WHTs on Interest Expense.

 Recovering all possible outstanding WHTs with penalties and interests.

 All forms of fraud that is being perpetuated by taxpayers will be largely

reduced as this exercise will serve as a deterrent.

 There will be improved Internally Generated Revenue for the State

Government to meet its needs and provide additional infrastructures for the
benefit of the electorates. This will no doubt increase the confidence of the
general public in the present administration.

 Strengthening the capacity of the state internal revenue service on revenue

generation drive.

 Infusion of the private sector business approach by handling the assignment

professionally.

 Enhanced reliance on information from and collaboration with other relevant

agencies of Government.

Recovery of WHT on Interest Expense

5
 Our indicative fee

The proposed fee for this recovery exercise is 20%. This is inline with the scale of professional fees issued by the Institute of
Chartered Accountants of Nigeria (ICAN). Our work is also based on the following assumptions:
•The state will provide an enabling environment such as maximum co-operation required, collaborate with relevant
agencies/institutions, provision of relevant document, availability of designated staff of the State Internal Revenue Service, etc.
during the assignment
•Suggested recommendations on process and service improvement are considered.

•We are adequately provided with information on the extent of recovery/remittances of WHTs on interest of depositors’ funds.

•The state promptly address issues passed to it by the consultants.

Recovery of WHT on Interest Expense

Page 8 Proposal for verification and codification of movable 6
Tele Ogunjobi &
assets for NNPC Co
 Our team
We have assembled a team that, from our experience, will achieve your objectives of this
assignment. Our team for this assignment comprises of Chartered Accountants with deep
experience in Revenue Monitoring and Debt Recovery.

Adebanjo Seyi (ACA) will be the Coordinating Consultant. He will be responsible for delivering
the assignment in line with our quality and service management standards. He will be supported
by Gbolahan Alebiosu (ACA) and Tayo Onanuga. The Curriculum Vitae of our team are on the
next page.

Others:

Ganiu Sulaimon

Kenny Babatunde

Olumide Ogun

Sunday Fabiyi

Daniel Asare