Transfer pricing regime in Nigeria | KPMG Global
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Nigeria: Overviews of transfer pricing regime, audit process

Transfer pricing regime in Nigeria

In connection with reporting the results of a survey about taxpayer awareness of the transfer pricing regime in Nigeria, overviews of the transfer pricing system and of the transfer pricing audit process are provided.


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The transfer pricing overview states that the transfer pricing regulations were effective beginning in August 2012, and the regulations address transactions between “connected taxable persons” (as defined by the regulations). The regulations require taxpayers to prepare documentation that demonstrates compliance with the arm’s length principle; that includes a transfer pricing policy and reflects compliance with the arm’s length principle; and that shows taxpayer compliance with the transfer pricing report as well as compliance with the filing requirements for the transfer pricing declaration form (generally filed once) and disclosure form (filed annually together with the corporate tax return).

The transfer pricing regulations allow for an advance pricing agreement (APA). However, the APA program in Nigeria has yet to be commenced.

Transfer pricing audit process

Transfer pricing audits are initiated when the Federal Inland Revenue Service sends an information and document request (IDR) to selected companies, based on the outcome of the tax authority’s internal transfer pricing risk assessment. These taxpayers then have 21 days in which to respond to the IDR. The next step is a field visit and interview with key personnel of the taxpayer under audit. The tax authority personnel will seek to re-validate the facts and declarations presented in the transfer pricing documentation during the interview. If there is a disagreement with the taxpayer’s position, the tax authority may make transfer pricing adjustments, resulting in additional tax liabilities. 

Taxpayers can seek a review of transfer pricing adjustments from the Decision Review Panel (whose decision on any assessment or adjustment is final). Still, a taxpayer can seek judicial review of a decision of the panel based on a “point of law.”


Read a June 2017 report [PDF 4.92 MB] prepared by the KPMG member firm in Nigeria

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