Corporate Tax 2010 - BMR Advisors

Babalakin & Co.
Nigeria
Nigeria
There are no significant taxes or fees incurable by a locally formed
subsidiary that a branch of a non-resident company will be exempt
from.
6.3 How would the taxable profits of a local branch be
determined
A branch of a non-resident company is treated for taxation purposes
as a duly incorporated company in Nigeria and is assessable
accordingly. A Nigerian subsidiary is taxable in Nigeria to the
extent that its income or profit accrues in, derives from, is brought
into, or received in Nigeria.
6.4 Would such a branch be subject to a branch profits tax (or
other tax limited to branches of non-resident companies)
6.6 Would any withholding tax or other tax be imposed as the
result of a remittance of profits by the branch
Dividends are allowed to be remitted to foreign shareholders upon
proof of payment of the requisite WHT which is a WHT payment
receipt. However, where there is a tax treaty, the remittance of
dividend will be exempt from WHT.
7 Anti-avoidance
7.1 How does Nigeria address the issue of preventing tax
avoidance For example, is there a general anti-avoidance
rule or a disclosure rule imposing a requirement to
disclose avoidance schemes in advance of the company’s
tax return being submitted
No, as stated above the applicable tax regime to a branch of a
nonresident company is exactly the same as that applicable to duly
incorporated companies.
6.5 Would a branch benefit from tax treaty provisions, or some
of them
Yes, a branch and/or Nigerian subsidiary of a non-resident company
can benefit from tax treaty provisions.
There are specific and general tax avoidance provisions in Nigeria.
The general anti-avoidance rules empower the FIRS to disregard
any artificial transaction between connected persons and effect
necessary adjustments of the terms or consideration as the tax
authority may deem fit.
There are no disclosure rules in Nigeria for the tax avoidance.
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