Nigeria’s Revenue Authority known as the Federal Inland Revenue Service (‘FIRS’) issued a public notice in January 2022 withdrawing the public notice dated 6 May 2021 and thereby reinstating the filing of Country by Country (‘CbC’) reports.
The reinstatement is effective from 1 January 2022.
On 6 May 2021, a public notice was issued suspending local filing obligations contained in Regulation 4 of the Income Tax (Country-by-Country Reporting) Regulations 2018.
Regulation 4 requires multinational enterprises operating in Nigeria to file a CbC report with FIRS if they meet certain conditions.
The conditions include where:
- the ultimate parent entity of the MNE Group has no obligation to file a CbC report in its own tax jurisdiction.
- the jurisdiction in which the ultimate parent entity is resident for tax purposes has a current International Agreement to which Nigeria is a party but does not have a Qualifying Competent Authority Agreement in effect to which Nigeria is a party by the time for filing the CbC report.
- there has been a systemic failure of the jurisdiction of the tax residence of the ultimate parent entity to exchange CbC report with Nigeria.
Failure to file a CbC report would make the company liable to a fine and/or penalties.