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Nigeria: Appeals court decision, taxation of company providing educational services

Nigeria: Appeals court decision

The Court of Appeal issued a judgment that a company providing educational services in Nigeria was subject to companies income tax.


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The case is: Best Children International Schools Ltd. v. Federal Inland Revenue Service (11 December 2018)

The taxpayer provided primary and secondary educational services in Nigeria. The company did not pay companies income tax for the tax years 2008-2012 because it asserted that its educational activities were exempt from income tax under provisions of Nigerian tax law. In fact, the taxpayer received an April 2013 confirmation from the tax authority that the profits from educational activities were exempted from companies income tax as long as such profits were not derived from a trade or business carried out by the taxpayer.

Nevertheless, a tax assessment was made against the taxpayer for the years 2008-2012 in September 2014 on the grounds that the taxpayer did not qualify for a tax exemption. The taxpayer sought judicial review, and the Federal High Court found for the tax authority. The taxpayer appealed, and the Court of Appeal upheld the judgement of the Federal High Court that the institution—not being a company limited by guarantee—was liable tax under the companies income tax law.

Read a February 2019 report [PDF 202 KB] prepared by the KPMG member firm in Nigeria

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