Why Every Growing Business Needs Monthly Management Accounts
Waiting until year end to know how your business performed is like driving while looking in the rear-view mirror. Here is why monthly management accounts matter.
Read MorePayroll errors are among the most common compliance issues we see in growing businesses. They can lead to penalties, back-dated liabilities and unhappy staff. The good news is that a simple checklist goes a long way.
1. PAYE (Pay-As-You-Earn)
Employers must deduct personal income tax from employees' pay and remit it to the relevant State Internal Revenue Service by the due date each month. Make sure each employee's reliefs and allowances are correctly applied, and that annual employer returns are filed on time.
2. Pension contributions
Under the Pension Reform Act, qualifying employers and employees make monthly contributions to each employee's Retirement Savings Account with their chosen Pension Fund Administrator. Contributions should be remitted promptly after salaries are paid.
3. National Housing Fund (NHF)
Where applicable, NHF contributions are deducted from employees' basic salary and remitted to the Federal Mortgage Bank of Nigeria.
4. Employee Compensation Scheme (NSITF)
Employers contribute to the Employee Compensation Scheme managed by the Nigeria Social Insurance Trust Fund, which provides cover for work-related injuries.
5. Industrial Training Fund (ITF)
Employers that meet the thresholds set by the ITF Act contribute to the Industrial Training Fund each year.
6. Good payroll housekeeping
- Keep signed employment contracts and updated personnel files
- Reconcile payroll to the general ledger every month
- Retain evidence of every remittance (receipts and schedules)
- Review payroll changes, new starters and leavers before each run
- Restrict access to payroll data and approvals
Rates, thresholds and deadlines are set by law and change from time to time. Always confirm the current requirements before each filing.
How we can help
Our Human Capital team runs accurate, fully compliant payroll for organisations of all sizes and can review your current process for gaps. Get in touch to learn more.
This article is for general information only and does not constitute professional advice. Please contact us for advice on your specific circumstances.