SYNOPSIS TAX INFORMATION

JURISDICTION – NIGERIA

SECTION 1 – GENERAL INFORMATION

GEOGRAPHICAL POSITION

The Federal Republic of Nigeria is located in Western Africa, bordering the Gulf of Guinea, Niger and Chad in the North; the Republic of Benin in the West; and Cameroon in the East. The total area of Nigeria, consisting of land and water, is 923,768 Square Kilometre.

The climate in Nigeria varies from region to region; it is equatorial in the South, tropical in the Centre and arid in the North.

The Political Capital of Nigeria is Abuja, while the primary business hub is the city of Lagos.

POPULATION

Nigeria remains the most populous country in Africa. The population of Nigeria in 2012 was estimated to be 170,123,740 with a growth rate of 3 percent (“3 %”) per annum. Nigeria has more than 200 Languages with Hausa, Yoruba, Igbo and Fulani as the major languages. The official and business language is the English Language.

LEGISLATION

Nigeria gained her independence from the United Kingdom on Saturday, 1st October, 1960. Nigeria has a written Presidential Federal Constitution which was adopted and made effective on 5th and 29th May, 1999 respectively.

Nigeria has a mixed legal system of English Common Law, Nigerian Legislations, Case Laws, Islamic and Customary Laws.

The three tiers of government in Nigeria are the Federal, State and Local Governments. At the Federal level of governance, Nigeria has a Bi-Cameral system of legislature consisting of the Senate and the House of Representatives. At the State level of governance, there are uni-cameral legislatures with each of the 36 States having a State House of Assembly.

TAX AND CORPORATE LEGISLATION

The Principal Tax Legislations in Nigeria are the Companies Income Tax Act, which regulates the taxation of the income of incorporated Companies; Personal Income Tax Act, which regulates the allowable income of individuals, partnerships, etc.; Capital Gains Tax which deals with taxation of any gain accruing from the disposal of assets. Other Tax legislations include the Petroleum Profits Tax Act, Withholding Tax, Value Added Tax Act, etc.

The corporate regulatory legislation in Nigeria is the Companies and Allied Matters Act.

DOUBLE TAX TREATIES

Nigeria currently has in-force double tax treaties, for taxes on income and capital gains, with Belgium, Canada, China, France, Netherlands, Pakistan, Romania, South Africa, United Kingdom, Czech Republic, and the Philippines.

Similar Tax Treaties have been signed with Mauritius, South Korea, Spain, Sweden and Poland; but these treaties are yet to be concluded or ratified by the Nigerian National Assembly.

TAX INFORMATION EXCHANGE AGREEMENT

Nigeria, like many other developing countries, has not signed a Tax Information Exchange Agreement or Treaty (“TIEA”) with any other Country.

CURRENCY AND EXCHANGE CONTROL

The Currency or Legal tender in Nigeria is the Naira; and its symbol is N.

The Exchange Control (Anti-Sabotage) Act has been repealed by the Foreign Exchange (Monitoring and Miscellaneous Provisions) Act (“The Foreign Exchange Act”).

The Foreign Exchange Act established an Autonomous Foreign Exchange Market (“the Market”) where transactions in Foreign Exchange are conducted in accordance with the provisions of the Foreign Exchange Act.

The instruments used to conduct transaction in the Market are Convertible Foreign Currency such as Foreign Bank Notes, Foreign Coins, Travellers’ Cheques, Bank Drafts, Mail or Telegraphic Transfers and such other money market instruments that the Central Bank of Nigeria may from to time, with the approval of the Minister of Finance, determine.

The Central Bank of Nigeria supervises and monitors the operation of the Market to ensure the efficient performance of the Foreign Exchange Market

 

Prepared by:-

Oserogho & Associates

Business Solicitors, Tax Advisers and Notary Public

NSE Centre, 1 Engineering Close

2nd Floor, Suite 206, off Idowu Taylor Street

Victoria Island, Lagos, Nigeria

Phone/Fax Nos. +234 1 463 7414;  +234 1 765 5635

Email: contactus@oseroghoassociates.com

Website: http://www.oseroghoassociates.com

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