Library / Implementation Guidelines for the Oil and Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order, 2024.
Implementation Guidelines for the Oil and Gas Companies (Tax Incentives, Exemption, Remission, etc.) Order, 2024.
Page 7 of 29
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Gas Utilisation Investment Allowance claimable* .
= 25% X USS6, 600, 000
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25
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US$ 500, 600
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(2) Computation Companies Income Tax
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For 2025 Year of Assessment.
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Assessable Profit
-
x 5,000,600
Less: Capital Allowance
“#,
2,000, oon
Gas Utilisation Investment Allowance
{500,000
Total Allowance claimable
3,500,000
3,500,000
Total Profit
1,500,000
Companies Income Tax @ 30%
450,000
~
Iustration 2
Topnotch Gas Processing Limited (TGPL) commenced the construction of
a Gas Processing
Plant in Port, Harcourt
i in January 2021. The contract for the gas plant was awarded at a cost
of US$100, 600, 06. with 4 completion period of three (3) years. Unfortunately, the Contractor
engaged to consttuct the plant abandoned the project after executing 70% of the job in March
2023 due-to: funding, issués. The. corfipany Rawever secured a loan from a consortium of
banks based on the Gas Utilization Incentives: introduced by the Federal Government in
February, 2024 to complete the contract. *
Consequently, the Contractor returned to Site, i in "April 2024 to complete.the outstanding 30%
of the plant. Assuming that the contract was eventually completed on 30 November 2024.
Calculate the Gas Utilization Investment Allowance claimable by TGPL on the project if actual
payments to the Contractor-were made as follows:
Payment date
Amount Paid (US$)
45 July 2021
30,000,000
45'* March 2023
20,000,000
12th March 2024
20,000,000
30% September 2024
20,000,000
4st January, 2025
40,000,000
Suggested Solution to illustration 2:
Topnotch Gas Processing Limited
Computation of Gas Utilisation Investment Allowance(GUIAY
a :
hy
Total Qualifying Expenditure on Plant and Equipment *
.
US$100,000,000,
Qualifying Exp, on Plant & Equip. liable to GUIA
(30% % 100m) US$30,0 000,000
;:*
GUIA Rate
: 25%
o
4
GUIA claimable on the Project
=
25% xX US$30,000,000,
=
US$7,500,000,
RegulationsPDF20242024-047