Investor Presentaiton
Free Trade Zones & Nigeria Tax Regime
The Legal Framework: Setting the Context
Income tax on Nigerian companies governed mainly by CITA, Cap.C21,
2004 LFN: tax payable at 30% on profits accruing in, derived from,
brought into or received in Nigeria (sections 9 & 40).
- Section 13 CITA permanent establishment tests - foreign cos liable to
Nigerian tax on profits: (a) there is fixed base in Nigeria and the profit is
attributable to that fixed base; (b) habitually carries on business in Nigeria
through an agent; (c) executes a turnkey contract; or (d) where the trade or
business is between the foreign entity and an affiliated company.
- Petroleum Profits Tax Act (PPTA), Cap. P13 2004 LFN defines the tax regime
for exploration and production companies at 85% (67.75% till
amortisation of pre-production expenses) and 50% for PSCs. Incentives
under MOUs for JVs and PSCs (PPTA and Deep Offshore & Inland Basins
PSC Act, Cap. D3 2004 LFN.
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